Big data and analytics will increase revenue growth for the retail industry, through optimized pricing and the creation of new opportunities to improve assortments, new products, marketing and other demand generators, according to a new report from IDC Retail Insights.
The study, “Business Strategy: Big Data and Analytics Lay the Foundation for Revenue Growth,” shows that in 2013 about 50 percent of retailers were aiming big data and analytics efforts at pricing strategies, market intelligence and customer acquisition. Another key finding is that price intelligence, a subset of product intelligence, is emerging as the initial set of capabilities aligned to support big data and analytics initiatives.
Beyond discovering prices and supporting better pricing decisions, the report says, product intelligence sheds light on competitors' pricing strategies and tactics, assortments, localization and channel strategies as well as on consumer decision making. It creates new facets of market and competitive insight through price discovery in the near term, with broader reach into assortments, private labels and management of private label and national brands, the study says.
"In particular, one application of product intelligence, price discovery, gives retailers a countermeasure versus the 'spy versus spy' price transparency of retail today," Greg Girard, program director at IDC Retail Insights, said in a statement. "Next-generation product intelligence in consumer decision making, competitor tactics and market conditions will propel [big data and analytics]-based revenue initiatives beyond pricing further into marketing, assortments, buying, and product development.”