Why retailers need data-driven strategies and IoT

Retail businesses across the globe are panicking about how they can compete with the digital world. We look at how IoT is helping bricks and mortar retailers fight back...

Andrew Bentley

29/10/2019

The conversation around the “retail apocalypse” is growing increasingly heated around the world.

Although most people assume that eCommerce and digital selling is leaving physical retailers in the dust, the statistics suggest otherwise. According to information from the Office of National Statistics, retail sales increased year-on-year between 2017 and 2018.

Although the number of online sales completed in the last year has increased too, it’s safe to say that the environment for brick-and-mortar transaction isn’t gone just yet. Instead, businesses simply need to think a little differently about how they interact with today’s digitally-driven customers.

In a time when major retailers like Toys R Us and Poundland have begun to shut their doors, companies are panicking about how they can compete with the ever-evolving online world. The good news is that all it takes to be successful today is the right retail strategy, combined with a little disruptive technology. Here’s why retailers need a data-driven business plan in the age of the digital nativeā€¦

The evolving nature of brick and mortar stores

It’s safe to say that brick and mortar sales are changing. Traditional stores aren’t the darlings they used to be for today’s consumers. As eCommerce continues to expand and explode, brands have begun to experiment with new ways of bringing foot-traffic into their locations.

The trend of buying online has forced retailers to take a closer look at the ways that they can fight back against the changing landscape. When people can get everything they need online at the click of a button, the only thing a physical retailer can do to stand out is offer an experience that their customer thinks is worth “going out of their way” for.

You need to convince your clients that they’ll have a better experience when visiting you in person, than if they were browsing through your store website pages from their sofa. One of the best ways to create these incredible worth-while experiences is with data-driven business strategies.

Today’s retailers have vast amounts of data available at their fingertips, which they can use to drive critical decisions and differentiate themselves from their competitors. The connected world means that companies can interact easily with in-store customers, link their online presence to physical locations, and cost-effectively connect with customers on multiple channels.

While the interactions that happen between consumers and companies, both in-store and online can vary, the insights gained from each option can create better opportunities for both. For instance, you could use beacons in your stores connected to IoT devices to tell you which products your customers are most interested in when they visit you in-person. This can help you create special in-store promotions for discounts that users can only get when they visit your brick-and-mortar outlet.

Data gathered from in-store experiences can also help you determine what the most common frustrations are for people who visit your stores so that you can provide better training and sales strategies to your agents and sales reps.

The importance of a complete picture with data

Using IoT in retail and data-driven business strategies can give today’s retailers all the information they need to design more effective in-person experiences for their customers. However, these insights will only work if you’re getting a complete view of what’s going on with your buyers. Often, companies make the mistake of collecting offline and online data in various environments separately. This creates “data silos” that can lead to inaccuracies in the assumptions you make about your customers. Retailers with multiple silos of data can’t fully understand consumer journeys, which means that they’re ultimately creating a disjointed experience for their audience.

The only way to take an effective data-driven approach to your retail operations is to figure out a way to connect all of your data streams. With information taken from in-store beacons for IoT, online customer relationship management systems, website analytics, email marketing tools, and any other campaigns that may be running, a business can truly understand how customers interact with them on every touchpoint. This also means that retailers can connect their online and offline experience into something more cohesive for their target audience.

For instance, imagine that a customer was using your app to browse for a particular product on their smartphone. When they walk into your retail store, that app could alert a beacon to what your client was looking for. The IoT system may then send back a push notification with a map to where the product is, details on how many of the items are in stock, and even a special discount code for your customer. This added technology would make the in-store experience for your client just as efficient and personalised as an online purchase.

Bringing data to the retail landscape

The potential of data, IoT, and other disruptive technology in the retail landscape means that today’s businesses can transform their in-person and online experiences for customers. In a world where it’s becoming increasingly difficult to convince your audience that you’re worth visiting in person, every intuitive action you can take makes a huge difference.

Don’t underestimate the power of data, particularly when it comes to creating loyal customers.