The retail market is in the midst of a powerful and exciting shift towards greater opportunities for richer customer engagement. The reason for this is the use of Big Data, a technology term in which businesses consider how to best take advantage of the masses of data that is flowing into and around their organisation, so as to better understand their customers.

Benefit bounty

In an enlightening one-on-one interview with Michael Geisler, the director of sales for Capillary Technology Middle East and Africa, he explained that retailers typically have an abundance of data spread around multiple sources.

In order to enable them to use this data and garner a better picture of their customers, Capillary Technology – which only recently opened up offices locally – is able to structure this data and thus create relationships between different subsets of information. This Geisler elaborated, then enables the company to benefit from analytics of their data, and see for example a customer’s favourite purchases and their typical buying cycles.

By taking advantage of analytics and big data in such a fashion, Geisler pointed out that retailers could then run very focused marketing campaigns and communicate with customers via their preferred channel (email, SMS or social media, for example), and offer them “the right message at the right time in the right way”. This could include special offers, for example, but it could also comprise notifying sales personnel in a store, advising them on how to better serve a particular customer or potentially make a complimentary sale.  

Child’s play also a customer attraction

Using big data more effectively could also benefit the business as a whole. Geisler gave the example of a particular unnamed department store which was considering jettisoning its toy section, which was the lowest selling department, and thus saving some floor space. However, its big data analysis revealed that the toy department was actually bringing customers to the store, and functioning as an attractor to customers who would then make purchases in other departments. With this information, the company was able to reduce the floor space occupied by the toy department but still retain it as a customer attraction.

For customers, better use of big data and analytics could mean more personalised and relevant service, whereas as for businesses, it could translate into greater customer retention and of course, an increase in revenues.

Geisler stressed though that this is a far cry from the spamming approach that is already employed, adding that if a retailer understands from their analysis that a customer only visits their store once every three months, they could communicate with them less frequently than another customer who purchases from the store every day or week.

Entrepreneurs, take note

Geisler pointed out that the company is able to scale its solutions to accommodate both enterprises and large stores, all the way down to small and medium business owners. What this means is that startups can take advantage of the same rich solutions that large, multimillion rand enterprises avail themselves of. In other words, the playing field has been mostly levelled, and now, small startups or retail entrepreneurs can compete like never before, to the extent of potentially biting at the heels of larger retailers, particularly if they have a firm understanding of their customers’ buying habits.

Geisler explained that Capillary Technology takes advantage of cloud technology, which means that smaller retail outlets do not need to make a massive hardware outlay in order to take advantage of the business benefits that big data brings. What’s more, big data analysis has become more important, if not essential for existing retailers both large and small, as multinational stores set their sights on the African market.

Watch out, world

For Capillary Technologies and general shoppers, the future looks exciting – as retailers tune into their data and start using it, it will certainly be interesting to see what kind of customer engagement campaigns they launch.