While “big data” has been a top buzzword for retailers for years now, a new survey finds that the China market is at the start of a data-driven retail revolution.
According to KPMG’s recently released fourth annual “Global Consumer Executive Top of Mind Survey,” the use of data and analytics (D&A) is taking off among China’s consumer retailers and manufacturers.
The global survey finds that global retailers and manufacturers are currently on the cusp of a true era of big data. It finds that only 29 percent of respondents worldwide currently use D&A in their businesses, but this proportion is expected to double to 58 percent in the next two years. These include technology such as predictive analytics, which will double to 59 percent over the next two years, customer paths-to-purchase analytics, which will reach 54 percent, and artificial intelligence, which will hit 43 percent.
Retailers are increasingly collecting data through a host of new methods, including real-time tracking systems, scenario modeling and stress testing, and micro-targeting.
According to the survey, around two-thirds of executives surveyed in China and Hong Kong said that by 2018, they will be using D&A, telematics (the transmission of data wirelessly back to the company), geospatial or location-based technology, and virtual reality. In addition, 55 percent said that “creating relevant, personalized customer experiences” is a top priority of using D&A.
The use of D&A is especially important in China’s competitive retail market, according to KPMG experts. “As a consumer living in China, I would say that we have some of the most technologically advanced customers in the world,” says KPMG China Partner and Head of Consumer Markets Jessie Qian. “To remain competitive and keep customers happy in a rapidly evolving marketplace, retailers and manufacturers require a deeper, multi-dimensional understanding of their customers. China does not have legacy issues and can therefore leapfrog straight to advanced data analytics and smart technologies to track and anticipate consumer behavior.”
According to the report, data should be helping brands to achieve “hyper customer-centricity” with the use of smart technologies, which will help them to target, segment, and personalize their interactions with customers.
According to KPMG China Partner in Data Analytics Consulting Kevin Liu, there is still more work to be done. “There have been a number of successful examples where data analytics has contributed to customer relationship management and precision marketing in the retail industry. There is still scope to expand. To move forward, retailers should integrate their business strategies and planning into big data applications so as to elevate the business value of data analytics.”