Holiday Retail Insights: Better Holidays Begin with Better Retail Analytics

The holiday season is approaching fast, an important time of year that brings in almost $1 trillion for U.S. retailers. But, as every retail leader knows, it’s also a competitive time of year — and maximizing holiday returns gets a little tougher each year.

Fortunately, breakthroughs in the use of technology like computer vision and video AI are helping businesses meet this challenge with a new level of advanced retail analytics to fuel better growth and efficiency. Here’s what retailers should know about seizing the power of this important new asset in time for the upcoming holiday season.

Holiday Retail Analytics in 2024: How Tech Is Changing the Game

The holidays are a highly competitive time for retailers, with factors like changing customer demands, market consolidation, and inflation concerns all offering serious challenges. For an increasing number of businesses, success depends not on adhering to the old model of sales, but on using advanced tech to achieve a more detailed and actionable level of retail insights than ever before.

The practice of tracking and analyzing customer footfalls, inventory levels, retail shrink, and other important metrics, retail analytics are essential for cutting costs, optimizing sales, and maximizing revenue. In the past, though, collecting this data was time-consuming and prone to error and misinterpretation — for instance, the inability of a traffic foot counter to distinguish shoppers from employees.

Today, though, technology is changing all of that. Applying computer vision to an organization’s existing security camera networks can provide a means of not just tracking store traffic in real-time but also monitoring and analyzing customers in a way that doesn’t compromise their privacy but captures the larger trends of their behavior.

And applying the power of video AI to this footage can increase the value of those analytics even further, helping retailers quickly make sense of what’s happening, both in real time and as long-term trends — and with minimum labor required. Mapping out trends and patterns faster and more accurately than ever before, this technology offers a much deeper understanding of every type of retail analytics that businesses need to thrive.

> Download the new Dragonfruit AI white paper on holiday retail insights for a more in-depth look at how AI maximizes retail analytics.

3 Ways to Prepare for the Holiday Season with AI-Powered Retail Analytics

Given all this potential, then, where can retailers actually use AI and computer vision technology to make the most meaningful improvements to their business in time for the critical holiday season? Amid all the possibilities, three methods stand out as the most impactful: visual/spatial intelligence, inventory management, and marketing and sales.

#1: Understanding Visual-Spatial Intelligence

Visual-spatial intelligence — or the process of gaining visual insights into every aspect of a physical retail space, like store layout and customer traffic — is key for optimizing everything from staffing and store hours to marketing and pricing.

With the help of computer vision, retailers can get a clearer vision of this kind of retail intelligence by distinguishing shoppers from employees, technicians, or even objects or animals. And applying AI to traditional metrics like zone traffic, peak time, and traffic count yields much more accurate prescriptive and predictive analytics, helping retailers know what to expect as they prepare for the holiday season.

There’s more. Vision AI technology can give brick-and-mortar retailers the power to easily track more detailed and meaningful data like the products people add to then remove from their shopping carts, or the products they engage with but do not put in their carts, giving them the level of insight usually available only to eCommerce retailers.

> Did you know? According to data from McKinsey & Company and Deloitte Insights, consumers exhibit a blend of both in-store and online shopping behaviors during the holiday season, with notable spikes in eCommerce during major promotional events and a resurgence in physical store visits as the holidays approach. Get more details in our new white paper.

#2: Improve Inventory Management

It’s been estimated that markdowns caused by ineffective inventory mismanagement cost U.S. non-grocery retailers approximately $300 billion each year. In addition, failing to have a product in stock when and where a shopper wants it doesn’t just hurt sales but customer loyalty. And during the holidays, those shortcomings can have an outsized impact.

By more accurately monitoring shelves and store rooms, computer vision and AI can help retailers avoid stock-outs during this critical time. Even better, the solutions offered by companies like Dragonfruit AI can align with existing PoS systems and online sales data to make the entire process of inventory and shelf management more effective and centralized.

And by applying sophisticated prescriptive and predictive analytics, retailers can clearly and quickly see the long-term trends affecting holiday sales. The result is a more accurate, longer-range view of just what inventory is needed at any given time, helping companies minimize holding costs, avoid costly markdowns, and avoid disappointing holiday shoppers.

#3: Better analyze sales, marketing and retail media performance

The advancements in predictive and prescriptive analytics offered by AI systems can help retailers more effectively target the customers who are most likely to convert. And with more powerful descriptive and diagnostic analytics, they can more readily understand why those conversions sometimes fail to happen, and make the appropriate corrections, whether it’s a change in product placement, pricing, or even store hours.

Finally, applying advanced retail analytics over the course of a month, season, or year will yield insights to maximize specific efforts around sales and marketing. Those insights can also be merged with computerized high-volume PoS data for an even more powerful store of data around the activity and preferences of shoppers to help optimize the customer experience.

With AI-driven retail analytics, businesses can also better understand how and where to direct promotions and communications. And retail media networks can provide exactly the kind of insights their CPG customers want. For any retail company, it’s a new way to maximize the effectiveness of sales and marketing, and to boost the ROI and impact of those efforts.

Take Holiday Retail Analytics to the Next Level with Dragonfruit AI

Best of all? Once largely inaccessible, these technologies are now available as app-based software that easily adapts to any organization’s existing camera infrastructure. The result is radical improvements in the type of retail analytics that can drive growth and success in the next holiday season, when every hour is critical to a retailer’s bottom line.

Get all the details by downloading our new white paper today — or learn more about the power of the Dragonfruit AI Retail Insights App here.

Disclosure: The apps promoted on this page are offered by Dragonfruit AI, a provider of app-based video AI business solutions. Read more about Dragonfruit AI here.

Image Credit: Featured image licensed under iStockPhoto account 16223288

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