Inventory Data Could Help Turn The Tide for Brick-and-Mortar Retailers
The rapid growth of Amazon, and the high-profile decline of brick-and-mortar retailers like Borders, masks a surprising statistic: e-commerce makes up only 5-10% of total retail sales in the United States. Customers still want the experiences only physical stores can provide, and data mining companies are helping small businesses take advantage of the web to increase profitability within their local community.
During a panel at Street Fight’s Local Data Summit, Closely CEO Perry Evans moderated a panel with Retailigence CEO Jeremy Geiger, Goodzer CEO Mike Wilson and Krillion/Local Corp Shopping VP Sherry Thomas-Zon, which took a deep dive in the challenges and opportunity of bringing local inventory online. The panelists argued that those data could provide small, brick-and-mortar stores with an advantage over thier online-only competitors — but only if those local businesses are maintaining and refining an online presence of their own.
When shoppers use retail websites for background information and inventory searches prior to visiting stores, data mining can step in and measure that information, using data sets to identify specific interests and behaviors so that customers can be catered to in a more nuanced way.
“We amass a huge amount of data, and there are subsets interesting to certain groups,” Thomas-Zon said. “We have to be flexible enough to serve those folks, and those folks will pay for access to that information.”
Wilson said that a majority of online traffic is driven by urgency and impulse, and businesses that offer their inventory through a website in addition to a storefront can count on a large amount of volume stemming from those purchase patterns. However, certain products are best considered by potential buyers in an in-person context, said Thomas-Zon, who used home appliances as an example to highlight the benefits of buying brick-and-mortar instead of online.
“As long as I see the refrigerator, you can bring it to me any way you want,” she said.
When small businesses identify what drives foot traffic versus online traffic, they can better serve their customers. And even though value is concentrated in the specificity of data sets, looking at that information broadly can also help form brand identity.
“If you take deep, hyperlocal data and create an online presence, you can provide a deeper story,” Wilson said.
Annie Melton is a reporter at Street Fight.