Learn More About Retail Analytics Software
What is Retail Analytics Software?
Retail analytics software empowers retail businesses by providing insights into all aspects of the store using various business intelligence data, such as sales figures, inventory levels, customer data, supply chain, etc. It also helps clean and organize inconsistent data sets and visualize them on a single intuitive retail dashboard for easy understanding and interpretation.
Retail insights drawn from this software help retailers accurately target customer needs in order to offer the right products at the right price at the right time. To do that, retail analytics platforms provide scope to analyze the performance of each retail metric at a granular level. These tools also influence marketing decisions by uncovering valuable insights related to consumer behavior and helping marketers design customer-based loyalty programs.
What are the Common Features of Retail Analytics Software?
The following are some core features within retail analytics systems that can help retailers find the best solution for their business analysis needs:
Data collection: Retail analytics tools help collect data from different sources, such as retail point of sale (POS) software, retail management systems, etc., in whichever form they are. The retail analytics tool integrates with these systems and helps with automated exports instead of manual collection by internal sales teams.
Data cleansing: The raw data received in the collection process goes through data cleansing to ensure accuracy and consistency. The retail analytics system deals with erroneous data by identifying incorrect or duplicate data, deleting the messy data, and then arranging the dataset in the appropriate format.
Data analysis: This feature of retail analytics software uses clean data and delivers useful insights and information in the form of different visualization dashboards such as tables, graphs, pie charts, etc., with the help of advanced artificial intelligence (AI) and machine learning (ML). These insights are later used to discover trends, predict outcomes, and make better business decisions.
What are the Benefits of Retail Analytics Software?
Retail analytics solutions are beneficial to retailers, suppliers, and customers. The information derived from the retail data uncovers areas for improvement and optimizes the customer experience at the store. Here’s how all the stakeholders benefit from software:
Offers retailers a competitive advantage: Retail analytics software can help retailers understand customer behavior and formulate strategies specific to individual stores. It automates the process of gathering, cleaning, and analyzing data, which was a tedious task. A retailer using analytics tools has a competitive advantage over its peer dependent on guesswork. Insights from the data also help retailers with competitive benchmarking, improve marketing return on investment (ROI), optimize in-store operations, and enhance customer loyalty.
Improves suppliers’ product management processes: Retailers are not the only ones who benefit from retail analytics tools. Suppliers also use historical retail data to plan and forecast demand, plan inventory management, see which specific product line is outperforming others in a region, and introduce new products catering to consumer needs. It also helps them plan future campaigns as a marketing initiative and pushes their product to prospective retailers.
Boosts customer experience: Customers are the indirect beneficiaries of the insight drawn with retail analytics tools. Retailers continuously strive to improve customer experience by creating eye-catching store layouts, discounts on merchandise, loyalty programs, and improved customer engagement. Customers feel happy, become repeat customers, and bring new customers on board, pleased by the unique experience retailers try to provide.
Who Uses Retail Analytics Software?
Managers from different departments of a retail organization use this software for better decision making. Here’s a list of a few personnel who often use this software.
Retail store managers: Store managers use retail analytics software to track and measure the performance of respective stores on a monthly, quarterly, and yearly basis.
Analytics managers: Analytics managers do data mining and draw actionable insights using various retail data analytics methodologies such as big data, descriptive analytics, diagnostic analytics, predictive analytics, and prescriptive analytics.
Brand or marketing managers: Brand or marketing managers use retail analytics platforms to monitor brand performance through sales data and track consumer behavior and trends, which allow them to strategize marketing campaigns and loyalty programs.
Software Related to Retail Analytics Software
Related solutions that can be used together with retail analytics software include other retail software such as:
Retail POS systems: Retail analytics systems easily integrate with retail POS software. Retail POS software is used in the day-to-day operations of a store for tasks like creating a sales order, finding product and customer information, billing, etc. It stores a vast amount of relevant information that can be exported to retail analytics software for analysis purposes.
Retail pricing software: Retail pricing software helps formulate the best pricing strategy for products and seamlessly integrates with analytics software. Some of the retail pricing tools come with analytics features that can do the job of retail analytics as a standalone product. However, some advanced analytics software must work in conjunction with the host software to get the best result.
Challenges with Retail Analytics Software
Retail analytics software comes with its own set of challenges.
Cost of purchase: Small to medium-sized retailers might find it difficult to purchase this software from a cost point of view. Since most of these tools are subscription based, there is a recurring bill associated with them. Also, most small to medium retailers are unorganized businesses with the absence of streamlined functions, where procuring such tools could be inconsequential.
Software integration: Retail analytics platforms need to be integrated with multiple types of retail software, such as retail POS, retail management, etc., to export data and analyze. A significant risk that arises during software integration is incompatibility, which leads to the inability to perform important functions.
Data security and privacy: Data security and privacy are major concerns for multinational corporations. Retailers gather several data sets such as customer names, mobile numbers, and email IDs for their vested interests. Any sort of data leakage from such tools could be a nightmare for the retailer and might affect the overall brand reputation in the market.
How to Buy Retail Analytics Software
Requirements Gathering (RFI/RFP) for Retail Analytics Software
Requirement gathering ensures that the software has all the features a business needs. It helps to understand the right tools required to perform critical task processes without wasting time figuring out how to do it. It also helps to ask critical questions about the need for the software. For example, retail analytics solutions help analyze retail data and present insights, but the buyer should also know if there is enough data to process and how these insights will help the existing position of the retail business.
Compare Retail Analytics Software Products
Create a long list
A long list helps refine software products with must-have retail analytics features such as data gathering, cleansing, and analysis. Buyers can add to the list software that functions as a standalone product or integrates into existing systems, such as retail management or retail POS. Some other things to consider while creating a long list could be the product's popularity, the price offered for product add-ons, schemes for upgrading, and 24/7 customer service support.
Create a short list
A short list narrows down the long list of buyers and helps them make a constructive decision on which software to opt for. Shortlists are more specific to the exact need of the buyer mapped with the features offered by the product. For example, buyers looking for cloud-based retail analytics software must not keep software installed on-premises on the short list.
Conduct demos
Demos are an essential part of the entire software implementation process. It ensures that the retail analytics software is running smoothly and is compatible with the existing business system. It allows buyers to ask questions about the software's features and ensures the retail analytics vendor is entirely transparent about the product offerings.
Selection of Retail Analytics Software
Choose a selection team
A team comprised of in-house IT personnel, project managers, heads of departments, retail experts, and end users must be part of the selection process. Along with senior management, this selection team is responsible for selecting the right software and checking the entire retail analytics software onboarding process. Buyers can also outsource technical consultants with domain-specific expertise to give constructive recommendations and suggestions in this process.
Negotiation
To successfully negotiate, the buyer must carefully analyze the final offering provided by two or more vendors. There are chances that vendors might offer similar software with similar features. In this case, the only differentiator may be the price provided by the vendor. The deciding factor during final selection in case of similar pricing might depend on product add-ons, unique customization, customer support post implementation, etc.
Final decision
In most cases, the senior management or head of the department decides to select the software after carefully going through all the documented insights provided by the team during the product testing process. It is also important to investigate all the vendor's terms and conditions beforehand to avoid last-minute confusion.
Implementation of Retail Analytics Software
How is Retail Analytics Software Implemented?
Buyers can implement retail analytics software at any point in the retail journey. The vendor’s IT team and the buyer’s selection team are responsible for the implementation. If the retail analytics software is installed on-premises, the implementation team should ensure it doesn’t affect retail operations.
Who is Responsible for Retail Analytics Software Implementation?
The selection team is usually responsible for the implementation process since they know the business requirements and how the new software can help. Service engineers and technical experts from the vendor’s side also collaborate with the selection team and address real-time issues during implementation.
What Does the Implementation Process Look Like for Retail Analytics Software?
The retail analytics software implementation process varies depending on the type of software installed, cloud based or on-premises. Cloud-based software is easy to install and can be accessed from anywhere. On-premises software needs existing infrastructure on which it is installed and can be accessed only within the premises.
When Should You Implement Retail Analytics Software?
A buyer can implement this software at the start of the retail business or after making a strong presence in the market. Also, selecting an ideal time for the installation process of the retail analytics software is essential to avoid interference with daily retail operations.
