Far from being slowed down by COVID, the retail industry has grown rapidly over the last few years. Both brick-and-mortar and online commerce platforms have seen significant growth as companies continue to develop new products, new advertising channels, and new business tools.
One of these essential business tools is business intelligence: the process of turning raw data about your company into actionable insights. In the highly competitive world of retail, business intelligence is a major way to set yourself apart from the competition and increase your market share.
- Business intelligence transforms data points into meaningful insights.
- You can increase market share by recognizing trends, visualizing data, improving ad performance, and optimizing profit.
- Hypersonix has AI-driven business intelligence tools to help increase your market share.
Business Is Getting More Intelligent. Are You?
The simplest possible definition of business intelligence is collecting data and transforming it into actionable insights. Business intelligence is the cousin of business analytics, but while business analytics looks forward and predicts future trends, business intelligence analyzes historical data to measure which activities work.
For retailers, business intelligence is especially important because your e-commerce business most likely involves large pools of data relating to product mix, advertising campaigns, customer relationships, and more. Storing all that documentation is a difficult task, and turning it into actionable insights is even harder. That’s where business intelligence can help.
Humans have evolved to be great at pattern recognition, but sometimes humans interpret what they see through the lens of their expectations. Humans see faces in inanimate objects, epidemics in unrelated news stories, and sometimes hold onto retail trends that have long since vanished.
Business intelligence cuts through the bias and subjectivity of trend recognition by finding patterns that may be invisible to even the most experienced human eyes and minds. Importantly, business intelligence does another thing that humans historically struggle with evaluating things on more than one criterion at a time.
Business intelligence does this by taking data about multiple KPIs (say, number of coupons distributed and average transactional dollar amount) to find correlations between the two axes. Does your dollar amount per transaction go up when you distribute more coupons? By how much? Do you make more money than you lose? Do customers who use coupons return more often than those who don’t? Business intelligence can help answer these types of questions by recognizing trends in your data.
Did you know that U.S. offices use 2 trillion pages of paper each year?
While that fact was technically true, it wasn’t the whole truth: U.S. offices do use 2 trillion pages of paper each year, but that’s not all they use. The total number is closer to 12 trillion pages each year.
While those numbers are drastically different (12 trillion is 600% of 2 trillion), most people would visualize those numbers as being nearly the same. If each of those pages of paper is the average office sheet thickness of 0.05mm thick, then 12 trillion sheets of paper would stack over 370,000 miles in the air, more than the distance from the earth to the moon.
With that visualization, it suddenly becomes much easier to understand the scale of our office paper usage. It is the understanding that business intelligence can help foster by visualizing data.
There are many different ways to visualize data, from the basics like bar graphs and pie charts to more advanced visualizations like tree maps to organize large hierarchies of data or 3D surface charts to plot points along three axes.
Improving Ad Performance
Of all the ways that retail has changed in the past decade, perhaps no area has changed as much as the world of advertising.
Advertising has exploded onto social media, with companies like Google and Meta each having nearly three times the market share as their next largest competitor. From digital video on platforms like YouTube and TikTok to influencer marketing on Facebook and Instagram, the face of advertising has quietly become exponentially more complex and nuanced.
The kinds of data available to retailers used to be things like “minutes of ad time” or “number of impressions,” but this new generation of digital ad channels has drastically expanded the scope of data to include thousands of data points. Companies used to only be able to target ads to a broad demographic (for example, listeners of a certain radio station or motorists that pass a certain billboard), but the digital age allows companies to target ads to extremely specific demographics, geographics, and even psychographics.
What does this mean for retailers? It means that your advertising strategy must be more sophisticated than ever, and business intelligence helps you leverage your advertising dollars for maximum results.
For instance, business intelligence can help businesses process data about multiple ads on the same platform to see which one led to more positive results for a certain demographic. Business intelligence can then help businesses see how that advertisement influenced spending habits and what the ROI was for specific activities.
What products are most popular in your city?
What email templates lead to the highest click-through rate?
Which customer service representatives have the greatest success?
Which departments have the highest turnover, and why?
It isn’t hard to come up with an answer based on anecdotal experience, a single metric, or some isolated data points. But finding the right answer requires an in-depth data analysis—the insight that business intelligence can provide.
You’re in business to create value, and one of the key ways you do that is by making a profit. Business intelligence empowers you in that pursuit by putting the answers to the most important business questions at your fingertips.
Hypersonix is an AI-driven platform helping e-commerce, retail, and grocery businesses manage their data intelligence.
Whether you’re testing social media ads, reevaluating prices, managing inventory, or looking toward future expansion, Hypersonix’s AI-driven business intelligence tools can help you optimize profit and increase your market share.
To see how Hypersonix can help, request a personalized demo today.