As a small retailer, you might believe that big data is only something that concerns large retailers. Nothing could be more wrong. Today, big data is well suited for small businesses. In fact, big data for a small business can be used in ways that a big business cannot. This is the first of two articles on how small retailers can use big data to improve their business.
What is big data?
Big data is most easily explained as a considerable amount of data that can be brought together, cross referenced and analysed to discern patterns in a way that results in better business decisions.
Small retailers have the agility
A common notion is that big data is only relevant for large companies that have collected enormous amounts of information, have access to expensive databases and can afford to hire analysts. That is not true anymore. Big data has become more of a commodity and that opens up new possibilities for smaller businesses. Besides, even the most powerful insights are useless if the company is not agile enough to act on the findings. Small retailers have the advantage of being agile and able to take actions immediately.
Massive amounts of data are free
Small retailers can get significant insights without paying a fortune. There are many free tools, such as SumAll, which provides a wide variety of data, including social media conversations and sales data. With Google Analytics, you can track exactly how a visitor behaves on your website and with Google Trend you can analyse specific trends all over the world. Amazon also offers public data that you can integrate into cloud−based applications for further analysis.
What is the importance of digitisation for the retail sector and what obstacles can arise for those who own or run a store? Learn about it here.
Take a closer look at your own data
The easiest way to kick-start your work with big data is to start analysing the data in your POS-system in more detail. By digging deeper into your sales data, you can get answers to other questions than you normally seek. Try to find connections between different aspects, and cross-examine various parameters. Is there, for example, a correlation between different kinds of offers at certain times or increased sales among other goods in the same product segment?
If you dive deep down in your data, the information you need can easily be at your fingertips. With this knowledge, you can create more effective marketing, launch more relevant campaigns and better adapt your product range to the customers’ needs.
Focus on one question at a time
In order not to drown in information, you should focus on one issue at a time. Start with an area where you have a lot of experience and check if conventional wisdom still holds. Once you understand your own statistics you can begin to cross-reference it with external databases. And remember, relevant analysis is more important than more data.
Don´t let yourself be left behind
Finding ways to get access to data in an affordable way and how to use it, has become a significant matter for small retailers who wants to keep up with the bigger competitors. Data-driven decisions can be crucial to your business success. When your primary competitors are investigating their sales patterns and pay wider attention to customer behaviours, don’t you think you should too?
In a couple of weeks, we will give you some hands-on tips and methods of how you, as a small retailer, can benefit from the vast amounts of data− both in-house and external− to help your business flourish.