Have you ever wondered that how much data you’re generating daily? The per-person generation of data is still measurable, but when it comes to the data generated by the businesses, it is gigantic. The significant part of this data from different departments is that it requires the best tools and techniques to get something useful out of it. The data analytics solutions offer high-end solutions to different businesses. When it comes to the fashion retail industry, the challenges faced by this industry are a bit specific and demanding than any other niche.
Fashion retail: All you need to know about it!
The fashion retail industry gracefully brings the manufacturers and the customers on a single platform. The range of products varies from clothing, accessories, and footwear. The modern definition of fashion has forced businesses to try their luck in this dynamic industry. But the issue remains the same that new businesses have to combat the markets that are ruled by the old and established organizations. This is where retail data analytics showcase their skills. It is not only about settling out the competition but is about using the power of digitization to earn wonders for your fashion retail.
The modern age is the time of quick decisions that should be backed by wise data. These quick decisions take no time in making or destroying the retail business. Thus, fashion retail is all about offering the best products to the customers. The “good enough” is not enough when you’re in a business that takes no time in switching to the old trends and is highly dependent on the customer’s pocket.
Needless to say, fashion retail is not just any other service sector and requires the best tools and techniques when it comes to supporting it digitally. Fashion retail is bombarded with an abundance of data that comes from manufacturers, marketing campaigns, and, most importantly, from the customers. It is crucial to harness the results from this data that helps in taking the timely decisions that make any fashion house survive in the dynamic markets. But before jumping to data analytics and its implications on fashion retail, it is important to understand the challenges faced by this industry.
Challenges in the fashion retail:
Businesses have certain common and specific challenges based on the type of the services/ products or customers. It is not only about large data volumes and the dynamic fashion industry. The challenges are much more deeply for the fashion retail businesses.
The short-term product lifecycle with dynamic assortments is an issue in fashion retail that leads to low return on investments.
The additional complexity in the product or services distribution is problematic when you have multiple SKUs to manage online. This causes inventory distortion that is a nightmare for any fashion retail.
The increased product returns due to multiple factors like variations in color or sizes make it difficult to launch a new product when the previous ones are stuck in returns. This process has a significant impact on the business revenue as well.
Analytics in fashion retail- The traditional approach:
The traditional approach to analytics is all about using past sales data. The sad truth is that the old sales data is many times misleading. The main factors that make this data unreliable are the demand changes, vendor costs, moving holidays, new products, new promotions, etc. Thus, trusting the old sales data can be costly and misleading at the same time. The mismatch between the predictions from the unreliable data and the preparations of the fashion retail hits a roadblock.
The unreliable data further causes an issue in creating unified analytics. The different departments of fashion retail run their respective patchwork to analyze the old data. Thus, the mismatch between the left and the right-hand causes irreparable losses for the businesses.
The low customer satisfaction levels, the mismatch between the demands and inventory, and selling off the existing inventory at a discounted price are other main issues in the traditional approach to data analytics.
Analytics in fashion retail- Advanced analytics:
The challenges in the traditional approach made fashion retail go for the advanced analytics that has cut-short benefits of over the old approach. The Ultimate Guide to retail analytics reveals a list of advantages that are not limited to the following:
Eliminates simple data visualization:
The predictive analysis skillfully handles the “what-if” issues that are not resolved by the data visualization tools. The prescriptive analysis further suggests the highly profitable actions to the fashion retail.
The predictive analysis is created using artificial intelligence-based tools that can automatically process large data volumes. Thus, it helps retailers to cut short inventory and increase business profits. The prescriptive analysis, on the other hand, generates recommendations automatically by taking the input from the predictive analysis.
Unified advanced analytics:
The unified business units offer a single source of data to fashion retail. Thus, the advanced analytics generated from the unified sources eliminates the chances of possible mismatch between the demands and the inventory. Thus, it fills the gap between the relevant data and the retail business functions.
Thus, it is not just an advantage but a necessity of the fashion retail to have unified advanced analytics. It keeps a strong check on the profitability drain that is major to the separate silos operating in the fashion industry.
Advanced analytics or big data handling is different for different businesses. It is crucial to go for the dedicated modern analytics that is designed for fashion retail.
The best features of big data analytics in fashion retail are optimal distribution recommendations for different products, short-life cycles, vendor load times, dynamic seasonality, etc. It further covers accepting returns, fulfills all orders, and optimizing the markdowns. Thus, the end results are maximized GMROIs.
Five best-advanced analytics trends in fashion retail:
Advanced analytics is taking the world by storm, and it is important to go through the top five and best-advanced analytics trends in fashion retail in 2021. These are:
Cross-selling and Up-selling using personalization:
Customers love the companies that care about their choices and preferences. The advancement in technology that understands the customer behavior and keeps track of their records for personalization. To think out of the competition and stay high on the customer’s list, many fashion retailers are using advanced technology like Hadoop to evaluate large data volumes. The insights from these technologies help businesses boost category growth and start evolving cross-selling and up-selling strategies. This further empowers the consistent marketing strategy that works well on all segments as the fashion houses are building a customer base on the pillar of customer segmentation.
All these personalization measures help to get the best business profits by improving customer loyalty and engagement. The finance data analytics further helps in retaining the existing customers and make smart marketing decisions- all this by using the shopping trends and customer behaviors. Thus, cross-selling and up-selling using personalization offers the best benefits to any fashion retail.
Managing seasonal fluctuations:
Fashion retail is a dynamic industry. A product in demand today may not be as popular in the coming season. Thus, it becomes crucial for the fashion industry to manage the seasonal fluctuations. Advanced analytics can effectively handle this pain point of fashion retailers. It is all about ensuring customer loyalty in every season. Thus, modern analytics offer the right customer insights to increase or decrease the seasons according to their requirements. This further eliminates the possible chances of customer attrition and results in consistent profits throughout the year.
The flexibility in the response of the supply chain to the seasonal demands and great precision in the in-season controls make things go in the direction of the seasonal demands. These are best ensures by the modern analytics that drives insights from the seasonal sales data and helps optimize- product, promotion, pricing, placement, and people in seasonal demands.
Digital marketing and social media analysis:
Who doesn’t use social media in modern times? Digital marketing analytics handles all possible issues of fashion retail and is one of the top-grossing trends in the industry. Businesses are spending enormous amounts on digital marketing and hence can rely on the precision of digital marketing data reports. The data from the mobile users continue to rule the modern analytics as to the number of mobile users, and fashion retail app users are growing significantly.
Social media is an indispensable part of digital marketing, and social media analytics are leading the world by a storm. When it enters the crucial fashion retail markets, it brings the real-time choices and demands of the customers to the retailers. Thus, the partnership of social media and digital marketing analytics handles all the necessary advanced analytics requirements.
Internet-of-Things (IoT) in the fitness industry:
Health is taking a backseat in the modern world; technology is again entering to bring the best to customers in the form of wearable technology. Thus, many fashion retail businesses are working in the direction to deliver the best products in wearable technology that doesn’t only stand high in fashion but have multiple benefits over the fitness needs. This smart technology is embedded into shoes, watches, trackers, clothing, etc.
The performance feedback and analytics from such devices are directly provided to the customers, who get the chance to have a detailed look at their performance. Thus, advanced analytics have not only helped the businesses earn great profits but is helping the fashion retail to offer high-end IoT-based products to fitness freaks.
Many businesses are using predictive analysis to get the best details about the upcoming trends in the business. Fashion retail is working hard to get things on board when the data is coming from every possible corner of the world. The combination of the internal and external data helps fashion retail get deep insights into the existing trends to know about the future. These insights help in making data-based decisions that are accessible in real-time.
Advanced Analytics in fashion retail- How to get started?
The multiple benefits and top-grossing trends in advanced analytics are making it crucial for fashion retail to implement them this season only. However, many may feel confused about getting started with modern analytics.
First of all, it is all about taking actions based on data and avoiding contemplating at your end. Thus, it is all about starting the advanced analytics with a proof-of-concept that improves the initial and operational costs in the data management. The leading fashion retail businesses that have incorporated advanced analytics have seen a sharp decline in inventory costs, manual labor costs, and needless markdowns.
These are followed by an increase in profitable promotions, GMROI, and sales. Thus, it is all about managing the business profits by investing in advanced analytics. Many new fashion retail businesses have entered the world of modern analytics through the leading fashion retail data analytics service providers. These companies clear the doubts of the businesses while makes them self-sufficient in dealing with all possible issues in the business. Thus, once fashion retail has made up its mind, it is quick, easy, and nowadays highly affordable to enter the advanced analytics market.
Think of the data, and it is impossible to miss the advanced data analytics. When it comes to fashion retail, it is not only serving the customers with shiny and durable products. The customers are demanding like never before, and the competition is at an all-time high.
Fashion and big data analytics may seem to be a mismatch in the primary looks, but it plays a crucial role in studying buying patterns, customer behaviors, etc. It further helps businesses decide on the next product to launch in the market. The predictions from this data are helpful in understanding the customer insights and get details of the ever-changing demands of the customers.
Thus, the only solution is to take the help of the business data that is optimized using modern analytics for any business. The recent advanced data trends in fashion retail in 2021 further make it a mandatory inclusion in your business. It is not only helping the businesses stay afloat in the volatile markets but is helping them channelize the flow of work and business effectively.