Our Privacy versus Their Survival: Big Data Keeps Online and Brick-and-Mortar Retailers from Hitting the Wall
LONDON, Jan. 15, 2015 /PRNewswire/ -- Executive Summary
This report provides analysis of the market Stratecast defines as Mobile, Retail, and Location Analytics (MRLA). The main conclusions and key takeaways are as follows:
• The terms "retailer" and "eTailer" do not have quite the same meaning in today's retail industry as they once did. Almost every retailer has a Web site where it also offers merchandise for sale; and, while some of the most powerful retailers in the world are in fact pure eTailers—no physical retail locations—even those companies have a set of needs and concerns quite similar to those of their brick-and-mortar (physical) counterparts. The needs of both types of retailers are well-served by MRLA technologies and solutions.
• The portion of MRLA focused on retail analytics, and, more specifically, on the collection of data from shoppers at physical retail stores, has become the front line of the battle that pits the needs of businesses to collect and use Big Data versus the rights of consumers to maintain some semblance of privacy in an always-on, 24/7 world. As such, retail analytics continues to draw fire from consumers, consumer watchdogs, regulators, and some legislators, particularly in the U.S.
• While Stratecast fully supports reasonable privacy in any industry and venue, we also see other areas where privacy is under attack, and has been for years, to a far greater degree than in-store analytics. Three that leap readily to mind are any Web site; the various and sundry online properties and online services that are all part of the Google empire; and the U.S. National Security Agency (NSA). This report analyzes the incursions of privacy occurring in these places, and contrasts it with what occurs in retail analytics, to bring some balance to the discussion.
• Retailers, industry watchdog groups, and a U.S. Senator have established an industry Code of Conduct that, while self-enforcing and far from ideal for consumers, outstrips and appears to have been specifically designed to prevent abuses that occur every day elsewhere, such as in the financial services industry.
• The importance of applying analytics to retail is underscored by the size of the MRLA component of the Big Data and analytics market, which currently accounts for percent, or $ billion, of that market. Retailers are obtaining big results from Big Data; and, to illustrate, this report provides snapshots of what some retailers and their MRLA providers are doing in that regard.
Introduction
Being a retailer can be a bracing experience these days. One faces competition from other retailers, ranging from local merchants to regional, national, and global chains, including so-called "big box" stores; and from global super-eTailers who may well have no brick-and-mortar presence, but do boast devoted repeat customer bases and massive revenues. The lines are blurring between retail and eTail, so, throughout this report, Stratecast often refers to both types as simply "retailers." Whatever label one might choose, many of these companies suffer from poorly-executed Web sites that do not effectively support retail reality; and from data management systems that do not integrate online, marketing, and inventory data. These factors result in inventory distortion, marketing of out-of-stock and deeply discounted products, and orders taken for products that do not exist.
The task of trying to remain competitive has been made tougher because retailers have been operating at a data deficit at the local (physical store) level. Companies that connect with customers via the Web capture massive amounts of data about customer behavior, which gives them a huge advantage over conventional retailers. Online retailers have gleaned analytic insights from Google Analytics and a variety of other online analytics packages, for up to a decade. More recently, technology has turned shoppers into price-hunting gunslingers, scanning product barcodes into mobile scanning/shopping apps that instantly tell shoppers where the same item is available, online or across town, often at a better price. That leads to the bane of the brick-and-mortar retailer's existence, showrooming: when a consumer shops for an item at a retail store but buys it online. The effect is accelerated because retailers are making offers for products that are not relevant to the targeted shoppers.
The good news for retailers of all types is that Big Data offers ways to fight back and regain lost ground. Stratecast defines Mobile, Retail, and Location Analytics (MRLA) as one of the five functional areas of the Big Data and analytics (BDA) market. This growing sector can equip retailers and brands with analytic insights to support marketing, sales, operations, and corporate strategy.
The bad news for retailers is that MRLA has been under attack from shoppers, consumer watchdog groups, and legislators because of the ways it collects data about shoppers—and the way retailers have, in some cases, put that data to use—which have been deemed intrusive and not respectful of consumer privacy rights.
This Stratecast report analyzes MRLA in context with other activities that occur every day on a national and global scale—activities in the private and public sectors that Stratecast believes have a far greater impact on privacy than MRLA. The report analyzes steps the industry has taken to address consumer privacy; as well as solutions and providers that allow retailer survival and consumer privacy to coexist.
Download the full report: https://www.reportbuyer.com/product/2604050/
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Sarah Smith
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SOURCE ReportBuyer
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