Big data has been part of business headlines for years — no matter what industry you're in, which markets you serve, or the size of your business, data and analytics are increasingly essential for staying both competitive and profitable. Many businesses know this, but they don't know how to get started or how to get better.
According to Software Advice, "As many as three-quarters of respondents cite sales reporting, analytics, and inventory as important features of a POS system, signaling that small to midsize businesses (SMBs) recognize how critical retail data analysis is for their operations and strategies."
And still, too many of those brands don’t have the tools to gain insight into the data that dictates sales strategies. Keep reading to take a fresh look at what business intelligence is, why it's important, and the role it plays in both in-person and online sales environments. Also, see how the right CPG business intelligence software makes all the difference.
What Is Business Intelligence?
Business intelligence comprises the systems, processes, and data sets your business uses to gain insight into your supply chains, customer service, and other behaviors so you can make more informed decisions. You need more than just the raw data to drive future growth; companies are analyzing more varied, in-depth, and granular data sets than ever before to understand each stage of the buyer's journey and create experiences that delight customers throughout every interaction with a business. To build a satisfactory environment for using business intelligence, you need:
- The ability to gather accurate data across multiple business functions
- Software tools that can evaluate the data and transform it into reports, trend lines, and more accessible summaries
- Analytics systems that further transform the data into dashboards that present actionable insights and point to what decisions are best for your business
It used to be that a focus on business intelligence was a way to get the edge over your competition and trim away wasteful processes. But today, it's an essential part of running a business. Without prioritizing BI, you simply can’t maintain a competitive business.
Why Modern Retailers Need to Focus on Business Intelligence
Once you know that business intelligence is far more than data and reports, you can begin to see why it's such a powerful element for retailers in any niche or market. Today's consumers expect every interaction with a brand to satisfy their needs and go the extra mile. Failure to create a positive experience can result in consumers turning to a competitor. In fact, past excellence doesn't protect you from present failure. According to PwC:In the U.S., even when people love a company or product, 59% will walk away after several bad experiences, 17% after just one bad experience. 32% of all customers would stop doing business with a brand they loved after one bad experience.
Should you ignore business intelligence and instead opt for what your opinion tells you, you are at risk of creating these disastrous negative experiences. The risks are also high because consumers can turn to nearly limitless competitors in online and in-person marketplaces. Let's explore where business intelligence has the most impact.
In-Store Business Intelligence
In-person retailers need to collect as much data as possible for the demand side, supply side, and customer service elements of their business, including:
1. Inventory Management
Because consumers are coming to your store in person, having the goods they're looking for is crucial. Often these shoppers are making impulse purchases, trying out goods in person, or are in a rush. With complete inventory management, you can build databases of what goods you have in stock, how often they're purchased, and what fulfillment patterns you must maintain to ensure you have the right products in stock. Over time, your CPG business intelligence software also helps you stay ahead of seasonal demand and avoid having out-of-stock goods at critical sales points.
2. Field Rep Performance
Friendly and effective customer service is just as essential as having the right products available for ensuring a great customer experience. While it's impossible to track every element of customer interactions, POS data goes a long way to giving you insight into each rep's performance. You can see sales (both frequency and volume) as well as tracking the rate of returned goods that were sold by a specific employee.
3. Competitive Intel
While forming a complete picture of each business location's performance can go a long way to shaping your core business strategies, it's not enough. You also need to know what your competitors are up to so you can (i) stay ahead of the curve, (ii) outperform in key areas, and (iii) distinguish your business with a different service model or style.
You can also use competitor insights to inform your product strategy. See what they're selling, not selling, and what customers are struggling to find.
In today's era of both online systems and insight into locations across a geographic radius, your locations don't exist in a vacuum. Neighboring stores can collaborate by sharing inventory, sharing data, and even sharing best practices so the shopping experience is more consistent across regions.
E-Commerce Business Intelligence
Business intelligence plays a key role in increasing your online store's performance, too. Two of the most critical areas for online business intelligence are:
1. Unified Shopping
With more data, you can create a cohesive experience that blends online and in-store shopping. For example, customers can check online to see if a good is locally in-store, check it out in person, and then order it for delivery. You can also resolve bumps in the customer experience by using online order and delivery to quickly provide out-of-stock goods, let customers pick up online purchases in a local store, and more. But you can't offer this flexibility without strong data.
2. Consumer Insights
As you build up customer profiles with thousands of data points, you can start to proactively make recommendations, personalize the online shopping experience, and more.
Find a Data Solution
At ThirdChannel, we specialize in helping retailers develop their business intelligence processes with intuitive data tools and analytics platforms. We can help your company start to collect more data so you can review online and in-person business practices, stay ahead of competitors, and drive revenue growth.
Power Your In-Store and Online Retail Sales With Better Business Intelligence
Business intelligence is no longer optional. Make it a core part of your business practices with the right business intelligence tools and CPG business intelligence software so you aren't left with piles of unactionable data. Contact us today to learn more about how business intelligence can strengthen your business or to schedule a demo.