<p>"Information is the oil of the 21st century, and analytics is the combustion engine." - Peter Sondergaard, Gartner Research<br><br>With e-commerce leading the way, there is an explosion of data from buying and non-buying habits; the Indian retail industry has undergone a major transformation over the last decade. With urbanisation and fast economic growth both organised and un-organised retailers are facing tremendous competition. For a change, the competition is largely home-bred, set off by the ascent of technology. With the spiralling growth of mobile devices, e-tail has seen some early success and is fast expanding. To remain competitive, the traditional brick-and-mortar retail sector has to embrace technology with the intensity that's been powering E-commerce companies recently. Technology and data insights sit on top of the pyramid for digital first and offline companies.<br><br>To keep a robust supply chain and improve customer experience, technology plays a key role in remaining competitive for the offline world. A retailer has to embrace powerful tools to understand customer-buying behaviour patterns. Today, all retailers need one important tool - data analytics, which could prove critical to the longevity of Indian retail. Companies that are agile and open to the power of data are more likely to fight off the E-commerce wave by offering superior customer satisfaction. According to a recent KPMG report, nearly 40% of the world's retail contribution will come from India and China. Companies that take a data-driven approach to decision making will thrive.<br><br>The data comes from various sources and various channels. It is important to collate them together in order for a retailer to gain valuable insights that can improve the way in which they merchandise to how they target with optimal communication and how to maximise both sales and profit. This is applicable both to online and offline shopping.<br><br><strong>The business implications of offline data</strong><br>Retailers should start by studying customer choices. Why does a customer prefer to turn left as soon as they enter the store? Why pause at an item and not the other? How much time is spent considering a purchase, which is then not purchased? What goes in a typical basket? What is the shopper profile - do they shop weekly or fortnightly? What are the general colour preferences of products in the basket?<br><br>All these details are captured as unstructured data either by camera footage, sensors in baskets or detecting the volume of products on the shelves with the help of IoT devices. With analytics, this raw indecipherable data is mined and analysed. Then it's structured in an understandable format which can be used to cater to the kind of patterns that are prevalent to that geographical area.<br><br>For example, residents of a particular locality may be more likely to stock up on perishable products because the closest super-market is about 4km away. A retailer would want to ensure that they have perishable commodities that have a longer shelf-life. To break this down further, the retailer can arrange their supply chain in a manner that allows them to sell ripe mangoes at one store and unripen mangoes at another. This data-driven insight allows companies to make smarter decisions based on offline buying behaviours.<br><br>It is estimated that less than a handful of companies are already using data analytics to monitor customer purchasing behaviour. Loyalty cards and vouchers are simple examples of the traditional ways of tracking how a customer cashes in. The potential to capture data in the online world is far greater in this regard. However, things get a bit more complex in the offline world. But this can also be an advantage as customer feedback is immediate. All the customer data should then be on-boarded to a data sifting platform that makes sense out of the input.<br><br><strong>Making data the centre-piece of strategy</strong><br>Information from offline channels like call centre data, point-of-sale data are invaluable. If the customer has taken the effort to make that call, he is all the more inclined to give valuable feedback about your product. The call centre representative can capture this information in easy, simple-to-use software. Data collected is then transferred to a platform that keeps unstructured data and gives actionable insight. In the past, all information was about purchases, but never about the journey taken to arrive at the buying decision. That should be the domain of data - giving insight into what motivated a customer to buy the product, or not. Understanding why a customer chose to 'not' buy, is all the more valuable, because despite your precise targeting, the demographic is not responding favourably to the product. This has a direct impact on the retailers marketing, merchandising and product strategy.<br><br>Data comes in many formats. For example, Wi-Fi hotspots can interact with customer and video cameras can provide heat-maps of what is of interest to customers. All this can be used to map customer behaviour. One of our studies in the US found that 62 percent of shoppers keep their Wi-Fi switched on while walking into a store.<br><br>By just keeping their Wi-Fi on, retailers can read the digital footprint of a customer. For example, is the right side of your outlet seeing weak traffic? What's the demographic of shoppers visiting your store? Can you make it mandatory for shoppers to pass through the right side to arrive at the product that sees the most traffic? Thus, data gives scope to make smart and informed decisions.<br><br> With retailers vying for customer footfalls and eyeballs, being able to give a customer a fulfilling and personalised experience gives the extra edge to companies. Only technology and digital data can help the marketing team achieve this task. It's ironical really - to serve the best offline experience, you have to take it online first. It's no surprise that Data Management Platforms are much sought after, but are yet to unleash their truest potential.<br><br>Integrating offline and online is still an unconquered frontier. Since so much data is being captured and monitored, companies have to build trust with their customers, and everything starts with having a robust security framework. But the one thing that's definitive for any organisation - data can make or break a business.<br> <br><em>The author Subramanian Gopalaratnam, is global head of innovation and technology for Xchanging</em></p>
