NEW YORK: Retailers in North America and Europe believe that Big Data is helping them increase sales but many are unsure of the extent of its role and fear analytic abilities are failing to keep pace with data volumes, a new report has said.
A survey of C suite executives in the retail sector, by the Economist Intelligence Unit for IT firm Wipro, examined how they were reacting to and benefiting from a growing amount of data. It found that more than three quarters of respondents' businesses (78%) had seen a positive economic return from investment in data analysis for the strategy area.
Some 63% reported increased brand loyalty as a general gain from data analysis, while just over half (52%) said Big Data had enabled them to expand their sales by offering the next logical item.
But only 30% were confident that they were getting the sales increases they had hoped for; most (52%) were simply not sure.
The report suggested that many retailers were still at the early stages of using Big Data, as just 46% of respondents felt their firm's analytical abilities were keeping up with data volumes.
And while firms continued to prioritise data collection, there was some concern (32%) over whether the use of large volumes of data would really help improve decisions.
Marketing was among the priorities for data analysis spending, with 46% of respondents putting this in their top three current areas of focus, and 40% cited it as a core area for spending in the future.
One area where Big Data was definitely bringing benefits was in co-ordinating omnichannel commerce. Over half of respondents (54%) reported gains in multi-channel sales while multi-channel customer tracking and management had become more profitable (52%).
But the problems of managing differing pricing and margin strategies over varying channels were also cited by 38% of those surveyed.
Srini Pallia, senior vice president and global head, RCTG (Retail, Consumer Goods, Transportation and Government) Business Unit, Wipro, said that while retailers realised the value of maximizing their use of big data and analytics, many remained unable to fully utilize the data they were collecting.
"Retailers need to explore new avenues to apply data analytics throughout the organization that will improve decision making, efficiency and interaction with customers," he said.
Data sourced from Business Wire; additional content by Warc staff