Predictive Analytics: How can it help Retailers

Introduction:

Predictive Analytics is a much concrete way to know one’s customer. In this era of Big Data knowing one’s customer is an important thing. The Retailers who know their customer can take a much smart decision and can have a more profitable outcome than those who have a very little knowledge about their customers. Predictive Analytics help in making a relative, personalized time for the customers. Every Retailer has a certain goal and on the other hand every Customer has certain desires. These predictive analytical methods help to bridge the gap between the customers and retailers. This analytical method helps the retailers in knowing their customer’s needs and wants in a much better way.

predictive analytics for Retail

Case Study:

There are various problems that the Retailers need to be dealt with. A most common problem among them is personalization of a product or service according to the customer’s behavior. In doing so the retailers forget one thing that the behavior of the customer’s differs. The retailers sometimes generalize the customer’s behavior and plan accordingly. The result or the outcome in this case is not up to the mark. The customers whose behavior seems to be same might differ in their desires or want.

On the other hand the retailer who takes care of their individual customer’s demand by predictive analytics tool and wish enjoys a much higher loyalty and profitable margin than the others. The sustainability of these retailers on the market is also much higher.

Usefulness of Predictive Analytical method:

  • Knowing the customers in a better way
  • Personalization of the customer’s product or service
  • Help in getting the fullest information about a customer’s changing behavior.

The Retailers who can think and take smart decision about a customer’s need and demand are the one who will sustain in the long run. Predictive Analytics is one of the important tool through which the customer’s insight can be known.

Predictive Analytics does not only about know the customers it is much beyond that. It helps the retailers in not only getting information about why they have lost a customer but it also help in building the ways through which the customers can be retained to their stores.

Stages of Predictive Analytics:

The method of predictive analytics must go through these four steps to provide a fruitful data to the retailers. The stages are:

  • Predictive Modeling
  • Decision Analysis and Optimization
  • Transaction Profiling
  • Predictive Search

Benefits of Predictive Analytics:

The Predictive Analytics method act as the fuel that helps the Retailers to obtain a proper business platform. It helps in bridging the gap between the customer’s wants with that of what the business wants. It helps the retailers to take a much smarter business decision.

Conclusion:

The Predictive Analytical Method helps in getting a much accurate and profitable business outcome. Predictive Analytics is an important customer analytical tool. The customer insight can be very well known through this predictive analytical tool.

Thus to be a smart Retailer Predictive Analytics is a much needed thing. Predictive Analytics for Retail is much in demand in this scenario of Big Data.

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Importance of Retail Analytics and Their Various Impacts on the Retailers of Today’s World

The Retail Analytical approaches or planning the Retail Strategies analytically help the Retailers to know their customers individually. It also helps in making the Retailers to save their money and limit bad expenditure.

Knowing the customer’s behavior is the key to success for the Retailers.

The Retailers who know their customers well are making much profit than the Retailers who are unknown to their customer’s needs and wants. When the customer’s behavior intersects with goals of the retailers or the suppliers then the profit rate is at the peak. This can only happens when the retailers know their customers very well. Thus Retail Analytics is very much necessary. It has been found that if the offers or the discounts arranged for the customers are being made maintaining various retail analytical strategies then the profit maximization rate for the retailers is also high.

Problems faced by the Retailers:

One of the very common problems being faced by the retailers is that they are unable to understand how to react and treat their individual customers. This is a common problem for in store retailing. The retailers also sometime face a problem in deciding what the offers should be or discount to be offered to their customers. Another mistake made by the retailers unknowingly is that, when a new customer enters the retail shop the retailers are unknown to the customer’s potential or the customer’s behavior so they treat every customer in the same way. To meet with this kind of situation various retail analytical strategies and plans should be designed. Coupons can be given at the entrance of the retail shop or discount offers can be sent as email to the existing customers. By seeing the response of various customers the customer’s behavior can be judged.
analytics1Retail Analytical Approaches made by the Retailers;

  • There are certain actions that the retailers plan and are then targeted to every customer might they be new or old. These types of actions are known as the collaborative filtering action. These types of offer or the discount are often being targeted to the customers of the online store or in-store.
  • The retailers also sometimes make their offers or discount by dividing their customers into small groups. These groups are made according to the customer’s choice, customer’s behavior.  This type of segmentation among the customers is most commonly being termed as the behavioral segmentation. This is a retail analytical process that can be done when the retailers know their customers very well. These types of retail analytical approaches also help the retailers to save some expenditure without spending on unnecessary offers or discount. The retailers also can spend the money on n house designing, preparing various new merchandising scheme or building up new promotional strategies. This segmentation among the customers also helps the retailers to serve their customers who are very important for their business.

The Retailers also sometimes plan the offers and discount by predicting the behavior of the customers individually. These retail analytical approaches are known as the propensity model. These retail analytical approaches can be used by the big retailers who deals with ten to twenty millions customers each of whom plays an important role individually for the business. These propensity models help the retailers to know the individual customers buying behavior. This also led the retailers to prepare various unique treatments towards their customers.