A critical part of the larger business intelligence (BI) domain, location-based analytics or location analytics allows organizations from varied industry segments to put together a composite space management plan by combining users' geographic location with behavioral information obtained from various data generating channels such as smart devices, social media platforms or global positioning systems (GPS).
Location-Based Analytics: Market Trends
For the retail industry, location based analytics can develop marketing strategies further to generate a better RoI. However, for this to happen retailers need to look at evolving trends from the location based services market. Market research firms project that this industry is growing at a rapid pace and is expected to reach USD 66.61 billion by 2026, at a CAGR of approximately 20%.
The global retail analytics market, as projected by market research firm Fortune Business Insights, is currently valued at USD 3,494.6 million and is expected to reach USD 13,299.6 million by 2026, at a CAGR of approximately 19%. The report also mentions that retail analytics offer retailers the ability to create and collect data, analyze and arrive at robust decisions to increase their bottom line.
Experts from the field of data analytics and retail management also suggest that ethical use of location data can help in building long-lasting relationships with customers, while increasing their brand value to prospects.
Location Data: Consumer Concerns v/s Consumer Benefits
While there are users' concerns regarding data protection & data 'pinching', retailers can benefit from this situation as the power of sharing location or spatial information remains with the users alone.
Only when users agree to turn on their location will they be able to send or receive communication to/from a particular source. For instance, when in a massive shopping mall, users can notify stores in the vicinity about their presence by turning on their location sharing option on their smart device.
Once this is done, store owners can relay flash deals to users through push notifications. As these messages are based on users' proximity to the store, retailers can look forward to increased sales while consumers themselves can get their hands on their favorite merchandise, at a discounted price!
Through the 'willful' sharing of location data, a concern has turned into a benefit for both the retailers as well as the shoppers.
In another scenario, where occupants inside a facility need to transmit their location information on a regular basis as part of the company policy, it becomes imperative for the management of that particular organization to gather data without the users turning on their devices. This activity, however, varies from organization to organization and isn't considered a universal norm.
In most retail spaces, especially ones spread across large areas, customers tend to miss out on good deals & offers as visiting each store to check out what's on sale is physically strenuous... which impacts customer experience of the space negatively.
Which leads us to the next logical question - what is the appropriate technology for retailers to ensure enhanced customer experience leading to improved revenue?
Location-Based Analytics: How to Choose the Right Tech for Marketing
As depicted in the image above, retailers can thrive by adopting a smart application supported by Geolocation technology.
This will help build better connections between them and their customers. In addition to proximity marketing, a 'shopping mall navigation app' can deliver additional benefits such as indoor wayfinding, location bookmarking, location based services, and real-time asset tracking. When combined, these individual benefits give rise to location based data of the user, which can in turn be used to make well informed marketing decisions.
When it comes to gathering data based on a user's location, the foremost technology that renders this service is the Global Positioning System (GPS). Applications used for maps & navigation, ride hailing, and dating among others use GPS as their primary tech platform.
However, GPS tech is not effective indoors as the building infrastructure and its attendant paraphernalia negate the strength of the GPS signal. This poses a huge problem for large facilities such as retail spaces, corporate campuses, and healthcare centers among others.
The solution lies in using Geolocation technology.
Geolocation tech, when integrated with an easy to use and responsive interface, can enable accurate indoor navigation, location based services, and asset tracking. To aid these functions hardware such as beacons, RFID tags or NFC labels can be used. WiFi can also come in handy when its reach is evenly spread across the length and breadth of the facility.
Also read our post on location based services trends in 2020.