Australian retailers have lost a decade on their US-based rivals. Since the early 2000s, many of the US retailers have been actively gathering and analysing the mountains of behaviour-oriented data generated by web traffic and putting it to work. Sites like eBay and Amazon use this information to transform their business from the outside-in – taking the data, extracting the insight and taking action.
However, as Michael Wu, Lithium’s principal scientist of analytics points out, information does NOT equal insights. He identifies three elements that transform information to insight:
- Interpretability – the hformation must be able to be interpreted. For example, unstructured data can float by in a sea of big data but unless it can be interpreted, its value is nil
- Relevance – if the information is not relevant – if it has no context, then again, it has limited value
- Novelty – the data must yield some insight that we do not already know. Otherwise it is reinforcing or validating an already available insight
The recent ClickFrenzy campaign run by Australian retailers would have yielded a tremendous amount of clickstream data. I presume, however, that this data was aggregated by the ClickFrenzy affiliate program and not the retailers themselves. In effect, local retailers have provided a significant boost to the ClickFrenzy business, allowing them to rapidly build a contact list, understand buying preferences of identified (and traceable) customers and creating a brand that is, itself, capable of disrupting the entire retail industry. This is the true power of big data.
This infographic from Monetate shows that while big data is available to retailers, many are unprepared or unable to leverage this data to gain insight or act. And yet, US retailers also indicate that the highest priority for investment in big data is in the field of marketing.
The shift to a matrix commerce focus for retailers is occurring now
The explosion of structured and unstructured data over the last two years has levelled the retail playing field. Bricks and mortar businesses can no longer rely on their business models or supply chains to attract and retain customers. New entrants are flooding the digital marketplace with compelling, relevant and novel offerings that are attracting connected consumers. Matrix commerce sees the convergence of demand signals and supply chains in an ever increasingly complex world where connected consumers are seeking frictionless buying experiences.
- Is your retail marketing ready for that world?
- Is your technology up for the challenge?
- Do your teams have the skill to deliver?
You know that a disruptive competitor is already only a click away.