Retail is struggling with tough task of grasping the potential of big data says Glynn Davis of RetailInsider, reporting exclusively for Retail Technology
Using 'Big Data' to create competitive advantage is proving increasingly important for retailers. But it emerged at the National Retail Federation's 'Retail Big Show' today that harnessing the data and gaining the relevant insight from it is proving a difficult task, writes Glynn Davis of RetailInsider.
Vivek Sharma, general manager and head of retail in Europe at Wipro, said: "Most of the conversations we are having with retailers involve an interest in [Big Data] analytics. Retailers are looking into it because data can be a differentiating factor and there is now more of it available especially with social media platforms [becoming more prevalent]."
Managing diverse data
However, there have been few examples of retailers enjoying meaningful gains from utilising big data - especially where it involves unstructured data such as video and Twitter feeds.
Jim Campbell, marketing manager for HP, highlights John Lewis as a rare example of a merchant using big data. Unlike many retailers he says it has combined both the instore and online sales histories of its customers to enable it to make potential additional sales at the point of sale (PoS) instore by prompting the sales assistants to make relevant recommendations.
"Lots of retailers want to do this but they have not invested in collecting the data. John Lewis has been pro-active in using the data and tying it in with providing added value service," said Campbell.
It has also leveraged social media data by linking its customer base with their Facebook accounts in order to identify potential topics that in can then engage them in discussions about.
Building structure at source
Unstructured data - from sources like social media platforms - is at the heart of the HP subsidiary Autonomy that is in a strong position to benefit from the emergence of big data.
It is working with retailers like US-based Macy's to determine the demographics of people visiting its website by using their internet protocol (IP) address and linking this to Experian for census information. This is then used to segment its customer base for investigating multivariant testing (MVT) on its website for specific market segments.
When this is combined with social media data and live chat interactions and then fed into the Autonomy Livesite software it is possible for websites to be tailored to specific segments or even down to individual customers - particularly for high value categories.
Recognising the importance of utilising multiple sources of data to create competitive advantage, SAP launched its Precision Retail application to bring together all data in the enterprise.
Transport system gets on board
Andrew Jones, industry principal at SAP in Europe, Middle East and Africa, said: "It goes beyond loyalty programmes and creates more of a dialogue - based on customer preferences and geolocation data. And because it sits in the cloud it can be implemented in a matter of weeks."
This model has made it suitable for its imminent adoption by the operator of the transport system in Montreal, Canada. This will involve linking the holders of travel cards with merchants and venues in the city that are accessible via public transport.
The ability of it to influence the usage of transport - potentially shifting travellers away from peak times by offering them promotions at certain relevant venues - has brought SAP's solution to the attention of an unnamed UK transport authority. Jones will only reveal that SAP is "engaged" with the organisation.