How Retailer can make their Future Bright with Big Data and Artificial Intelligence

With the all-time-low unemployment rate since 2000, the U.S. economy is doing much better than it was after the banking-generated financial crisis of 2007–2008. That crunch killed nearly 8.6 million Jobs in the U.S.

Also, despite that meltdown, there has been no or little decrease in U.S. consumer spending, but retailers have, of course, reached their nearly extinction-level. More than 20 retailers, including Toys R Us, The Limited and Payless, reached bankruptcy protection in 2017. Sadly, it’s double of the number from the previous year. A report from CB Insights says that close 7,000 retailer stores were close in the U.S. last year. The only reason is that the digital commerce continues to draw more customers day by day. In fact, Amazon is eating everyone’s lunch. It’s one obvious explanation for this retail apocalypse.

Amazon, also known as the “everything store”, has succeeded to rake in $106 billion in North American revenue last year by commanding four out of 10 online retail sales in the sales with its ability to know what customers are exactly looking for.  If comparing Sears, the online and in-store company generated $17 billion in sales last year. It’s way more down from $43 billion in 2010. The number of subscribers of Amazon Prime around the world has touched 100 million.

But not all retailers can down their shutters. This is time. They should take help of technologies like data analytics and artificial intelligence to formulate marketing strategies and fight this Amazon threat. With these technologies, retailers can make the way to lure buyers on their stores. 

Macy’s, the cloth and fashion store, began an experiment with pup-up marketplace earlier this year. The company gave pods of space to some brands and companies on Macy’s ground floor to sell or promote their products. This was temporary access to Macy’s store’s ground floor space.  By doing this Macy’s offered their customers with more variety of their shopping.

Brands like Target and Gap have been reported to reduce the sizes of their stores so that they can have access to densely populated areas. 

Still, these efforts will not do a magic. Brick-and-mortar retailers are learning how customer data can help them increase sales just as Amazon is doing.

It will begin with understanding who these people are that are spending money. And it’s rather different from old-day marketing campaigns for which retailers used to target a million people and hope some of them buy form them. Now, it’s all about owning the customers, who have already bought from your.  

As anyone who has used it well knows that Amazon has been automatically directing repeat buyers toward products they may purchase. The company does it with the help of data collected from users themselves.

Retailers operating online are now interested in adopting similar strategies for their retail platform. A good example was placed by Restoration Hardware in 2016. The home furnishing company adopted a paid subscription model and left competitors and industry-watchers to wonder why anybody would pay $100 for a special discount price access to the interior design services. But then in March, the company said that its pay-to-play model delivered 95 percent of the company core business from 405,000 paid subscribers. Also, subscription reduced the rates of order cancellation and product return.

The membership model enhanced the brand of the company, streamlined several operations and improved overall customer experience, according to Gary Friedman, CEO of Restoration Hardware.

This helped the company to get its own database of hundreds of thousands loyal customers. The database can also become a base for several strategies related to business, marketing, and supply-chain.

Nearly every major retailer is now exploring ways to use Big data analytics and artificial intelligence to deliver a personalized experience and lure customers away from Amazon.

So, by seamlessly integrating data analytics and AI, even traditional retailers can foster a ground-breaking environment for customers.

Author Bio:- Sofia Coppol is a digital marketing expert in Rapidsoft Technologies, a leading Block chain development services Company which provides Software for Education, Automation, Construction and Finance across the global. She loves to write about latest mobile trends, mobile technologies, startups and enterprises