Big data is a long-term game in the retail industry. Only when companies have built strong historical datasets that absorb a variety of factors, can algorithms begin to work efficiently. But, when that point is finally reached, it unlocks incredible utility.
Businesses can start to predict how often consumers make purchases, how much they're spending, and what product SKUs should be given preferential treatment. This method identifies windows of and for promotions and discounts as well as cross-selling opportunities.
With a large amount of data—full of information on consumer behavior—businesses will get the opportunity to personalize each and every customer experience.
A retail business will also need to factor in every channel for a marketing campaign. What age are they? What location are they shopping at or from? Is it an in-store or online purchase?
The marketing strategy of any business needs to be tailored depending on the audience and channel targeted. Big Data Analytics comes into play in both the online realm and in-store. So, unique strategies should be developed for both types of shoppers.
Related: The state of ecommerce in 2022
For example, one of the most important channels for retail marketers in the present day is mobile devices. There are more than 10 billion connected mobile devices in use globally. Roughly 79% of smartphone users have made an online purchase in the last six months, which showcases how vital it is for generating sales. If we factor in key shopping holidays such as Black Friday, the impact on companies not incorporating multi-channel marketing strategies is quite obvious.
One company that takes advantage of online opportunities is Ulta Beauty. Previously, it used big data to partner with creators in all 50 U.S. states that had some form of relationship with cosmetics. They were able to expand their reach and awareness, increasing brand loyalty by collecting 14 million impressions.