The benefits of advanced analytics for South African retail industry

South African retail is a competitive space, with tight margins, customers demanding great prices and more personalised offerings, and consumer spending under significant pressure.

WHAT DATA ANALYTICS DOES FOR SOUTH AFRICAN RETAIL

Big data analytics can be an invaluable tool for retailers seeking a competitive advantage in a complex and volatile operating environment.

That’s the word from Steven Heilbron, CEO of Capital Connect, a fintech that offers hassle-free and flexible opportunity capital to South African retailers in 24 hours. He says that advanced analytics tools can help a retail business to make faster and better operational and strategic decisions, based on real-time insight into the latest trends in their business, customer base and broader market.

Advanced analytics is all about using complex algorithms, statistical models, and other tools to extract insights from data. This set of tools can be put to work to analyse customer data, point of sale data, inventory data, and e-commerce platform data, and then use it to fuel automated business processes and make smarter business decisions. 

Heilbron said: “The data retailers collect through digital marketing, loyalty programmes, point of sales transactions and integration with supply chain partners is a treasure trove. Analytics tools enable a retailer to sift through logistics, inventory and sales data for nuggets of insight they can use to take actions to outsmart their competitors”. 

“They can use this data to forecast customer demand, sharpen inventory planning, optimise pricing strategies, or refine operational planning in areas such as logistics. The retailer could, for example, use opportunity capital to bulk-buy inventory when there’s an opportunity to stock up on a product before a seasonal surge in demand.”

Heilbron

ALSO READ: Ways to use opportunity capital to grow a retail business

GET AN EDGE WITH DATA-DRIVEN INSIGHTS AND OPPORTUNITY CAPITAL

According to Heilbron, another key benefit of advanced analytics lies in the ability to personalise the customer experience. Retailers can use data to create a personalised shopping experience for each customer, tailoring product recommendations, offers and marketing messages to individual preferences and needs. This can help retailers increase sales, up-sell, improve customer satisfaction and build customer loyalty.

The potential of data and analytics becomes even more exciting when matched with emerging artificial intelligence (AI) and machine learning technology. Predictive analytics uses AI to analyse historical data and identify patterns that can be used to make predictions about future events, such as customer behaviour or market trends.

ALSO READ: Senior SANParks manager killed by hippo in Kruger

“ A retailer’s website might show an increase in searches for products such as vegan food lines or CBD oil. Equipped with this insight, the retailer can move fast to expand its product range and promote its new offerings to potential customers. It can then track how popular these products are in real-time as well as assess how profitable they are to sell.”

Heilbron

ALSO READ: How retailers can position for growth amid plunging sales 

SEIZE EVERY ADVANTAGE 

The landscape is forever changing and retailers need every advantage they can get during a time of slow growth, shifting consumer buying behaviours, and fierce competition. Data analytics will help to spot new opportunities as they emerge, so that retailers can personalise customer experiences as well as improve efficiencies.

“With data analytics, you can see what your customers are looking for, what your competitors are up to, and what’s happening in your supply chain. This helps you make decisions about purchasing stock, diversifying your retail business or adjusting your marketing strategy,” Heilbron explained.

ALSO READ: Why your smartphone charger is overheating and what to do