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What are the Benefits of Utilizing Retail BI?

Retail business intelligence is a technology-driven process of translating raw data into meaningful insights to support better decision-making in the retail industry. As retail BI has become a paramount ingredient for survival in the industry, we will take a look at what benefits brick-and-mortar retailers can gain by actively utilizing retail BI.

Floor plan optimization

One reason brick-and-mortar retailers resort to business analytics is to eliminate the guesswork in creating a floor plan that is conducive to sales. By employing BI software, retail companies define whether the selected store layout (chosen according to the store size and products offered for sale) is effective and, if needed, adjust it accordingly. After analyzing various data sets (visit duration, number of sections visited, number of stops, dwell time, etc.), retailers adjust the floor plan in such a way that a customer can easily find what they want and, at the same time promote cross-selling and up-selling.

Product placement and merchandising optimization

One of the benefits retailers pursue with a BI solution is product placement optimization. By analyzing in-store traffic, a company can find the store’s “hot-spots”, which are further utilized when deciding where to place key products. Merchandising can also be tuned, for example, by integrating a company’s BI solution with visual recognition software: when the stalls are running empty, merchandisers get an alert. As a result, the company prevents customers’ disappointment about the absence of products and enhances customer experience.

Demand plan optimization and effective inventory management

A BI solution can also address the challenges of anticipating the demand for particular products and over or understaffing at a specific time at a specific store. By comparing historical data (traffic analysis, sales analysis, etc.) with other data (local demographics, weather forecasts, etc.), retailers can reduce costs by accurately predicting order volumes and by hiring temporary workers during estimated peak seasons or providing employees with day-offs during lean seasons. Additionally, inventory analysis helps them identify the best-selling and the worst performing products to re-evaluate ordering quantities.

Tuning marketing activities

One thing that drives retailers to implement a BI solution is the need to tune their marketing activities. Companies employ advanced customer analytics to provide their customers with personalized offers, targeted discounts, and loyalty programs. By gathering and analyzing data about customers from various data sources (purchasing history, video analytics, social media, etc.), retailers can effectively segment their customers to ensure customized offerings go straight to the target.

Achieving competitive advantage by conducting benchmarking

BI software presents accurate timely data for a company to evaluate its performance according to individual KPIs or industry standards, which simplifies the process of benchmarking. Thus, by analyzing underperforming or high-performing business areas, retailers can manage to make data-driven decisions at every organizational level, taking into account their former experience or their competitors’ performance.


Cyclops provides brick-and-mortar retailers with insightful retail analytics. To find out more about Cyclops, visit our website:


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