Data analytics refers to the process of extracting useful information from large datasets in order to reveal hidden patterns, market trends, customer preferences, etc. The benefit of data analytics is that it allows business owners to derive valuable insights from information in order to make the most effective eCommerce businesses benefit from big data analytics, which helps them understand their customers as well as predict market trends and boost sales. The reasons why big data analytics is an advantage in the eCommerce market can be explained.
Personalizing Experience
The preferences of visitors can now be tracked by e-commerce stores of any size. It is thus possible to display products according to individual habits and tailor them to suit individual needs. It is true that promotions and recommendations can be generated based on previous behavior. You can expect an increased conversion rate and retention rate as a result. As a bonus, it reveals several upsell and cross-sell possibilities. It is Amazon that has perfected this practice and other companies can emulate it.
Forecasting Demand in Retail
As well as big data, some algorithms analyze social media and web browsing trends to predict the next big thing in retail. It’s interesting that the weather is one of the most important data points for forecasting demand. Several retailers, including Walgreens and Pantene, worked with the Weather Channel to ensure their product recommendations were tailored to the weather patterns. With humidity growing, Walgreens and Pantene marketed and promoted anti-frizz products in an effort to increase sales at a time when women were looking for products to prevent frizz. Walmart saw a 10 percent increase in the sale of Pantene products over the past two months. In addition, the company rose 4 percent in sales across the hair care category during the Throughout different parts of the year, marketers use retail forecasting as well as retail projections to plan their resources most effectively.
Generate Increased Sales
E-commerce retailers benefit from big data by customizing recommendations and coupons to meet the needs of their customers. As a result of this personalized customer experience, the company receives more traffic, and profits increase. Also, providing comprehensive reviews of products will help the buyers to buy the best items. Like how Overview.io helps consumers to compare products with detailed reviews of the best items to purchase. Using such data can also help e-commerce businesses run more effective marketing campaigns, give appropriate coupons and remind customers that they still have items in their carts.
Managing Fraud
Increasing the size of data sets can help detect fraud more effectively. The right infrastructure will boost profitability by detecting fraud in real-time. Consequently, you’ll be able to detect fraud in real-time and run your business in a safer environment. A majority of online retailers need to process their sales transactions against fraud patterns in order to detect fraud. In case it’s done in near real-time, it may be too late for the fraudsters to be caught.
Customer Service
A website’s customer service experience is one of the major contributors to churn. That’s why in addition to using AI-powered customer insights to transform its customer experience journey, e-commerce retailer. Glossier is using AI to improve its customer service for its customers. The company’s sales team used data analysis to identify that many product returns were due to a lighter shade of the same lipstick being exchanged for a darker shade of the same lipstick because of the unusual spike in returns. In light of this, the company was able to improve the color-matching on the company website for that particular product, preventing any confusion in the future. As a result, their customers have also been contacted directly with personal messages, resulting in higher retention rates.
Supply Chain Visibility
According to Mehra, retailers can use big data analytics to provide their customers with information on the availability of, and the status of, their orders. It will be important for commerce, warehousing, and transportation functions to be in communication with each other and with any third-party systems in your supply chain, he writes. “This functionality can be implemented best by making small changes at a time.”
A Reduction In Cart Abandonment
A company can also use cross-device tracking to reduce abandonment rates of shopping carts. In a recent study conducted by eBay, they found that the average consumer uses at least three devices or platforms during the duration of the buying process. With the help of data, retailers can map this journey offering customers seamless transitions between devices and helping them complete their purchases.
Secure Online Payments
In the context of this kind of service, it might be worth pointing out the risks related to using a centralized platform. It can be dangerous for hackers to have access to a lot of sensitive information in one place. As well as PCI Compliance, tokenization of data helps to mitigate this. If you’d like to see which payment methods are most effective, choose a custom orders view and select the payment method(s).