Big data demonstrates a rapid, powerful impact on profitability
Interest in big data has been increasing as enterprises look to harness deeper insight into customers, the market and the business' future. Now, these efforts are beginning to demonstrate significant advantages that promote more intelligent decision-making and investments, which boost the bottom line.
Daniel Burrus reported for The Huffington Post that Walmart is one major corporation that has been able to mine big data for big results. Burrus revealed that the volume of inbound data that Walmart manages every hour could fill a room of 60 million five-drawer file cabinets. Additionally, with the implementation of more sensors for real-time sales and customer analytics, the amount of information coming in will only increase. He noted that this data is invaluable as it informs businesses on where consumers are going and when as well as what they're buying. And by deploying dba services and the most capable database experts, these firms are already seeing dramatic results, according to Burrus.
Burrus cited electronics chains The Source and Charlie Brown as two stores that are using real-time analytics to make better decisions. He explained that by diving into big data, these companies were able to detect a shift in purchasing, specifically that several upscale items (in the $650 range) were selling more than lower priced models (at about $150) in the same line. The firms were then able to stock the shelves with more of the higher-priced merchandise, causing sales to surge 40 percent thereafter. By looking at big data, these companies could quickly identify which products were in higher demand and react more quickly to see rapid payoff. Additionally, Burrus noted that these businesses were able to discontinue items that weren't selling, which also boosted profitability by eliminating products that are wasting inventory space.
As a result of big data, companies are also now able to devise better pricing strategies. Yahoo Finance revealed that when product prices are too high, customers may be hesitant to buy, but when they are too low, companies shortchange themselves and hinder ROI. Shaw Industries, a flooring subsidiary of Berkshire Hathaway was able to determine that more than half of its products were underpriced, the news source reported. By applying analytics insights and adjusting prices accordingly, Shaw's margin in dollar terms increased by more than 5 percent.
While industries have continually looked to shift pricing models, inventory and other strategies to reflect changing consumer demands, big data has allowed for a new accuracy that wasn't possible before.
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