‘Exponential ROI,’ retail revenue expected from big data analytics

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Two new reports on the implementation of big data analytics pinpoint the potential that telecom operators — and many other verticals — are hoping to benefit from by relying more heavily on data to fuel decisions from marketing to business operations to network management.

Frost and Sullivan identified four broad use case categories that span multiple verticals: customer insights, resource optimization, processes/productivity improvement and risk, security and intelligence. The company noted that there is particular interest in BDA-based customer segmentation and marketing, and those are some of the most widely implemented BDA applications. The report covers both data discovery and visualization and advanced analytics; Frost said that although real-time DDV offerings are in high demand, “exponential return on investment from AA solutions suggests that these too will strongly penetrate various industry verticals,” including telecommunications specifically.

However, Frost and Sullivan noted, “the market is still in validation mode and companies are wary of investing in these costly deployments that run well into six- and seven-figure deals. Advanced analytics is still a rich man’s market and organizations hesitate to invest heavily due to an absence of tangible results for some applications.”

Still, the analyst firm said that the big data analytics market earned revenues worth $3.2 billion in 2013 and predict that this will increase to $15 billion by 2020. Vendors are putting substantial investments into research and development, as well as potential acquisitions.

This certainly reflects some of the market developments so far this year in big data offerings specific to telecom. Amdocs launched a big data analytics portfolio in May aimed at telecom service providers, including a big data platform to integrate information from multiple sources; applications such as network management, customer care and contextual marketing; and data-science-as-a-service, or the ability to leverage Amdocs’ data scientists as consultants to hammer out big data solutions for specific issues. A month later, network equpiment vendor Ericsson unveiled a new BDA platform that can draw on information from sources ranging from network nodes to social media for purposes such as resolving calls faster and targeted marketing.

Meanwhile, as summer draws to a close and the holiday shopping season looms ahead, a new report from IDC Retail Insights discusses the use of big data analytics (BDA) for revenue growth in retail, outlining an approach of “participatory commerce” that seeks to balance customer satisfaction with efficiency in marketing and merchandise economics.

IDC said that about 50% of retailers were exploring big data analytics-based pricing strategies, customer acquisition and market intelligence and that more will join them in the next 2-3 years. Although many of the analytics will be drawn from online shopping and dynamic pricing, they inevitably will come from mobile as well. Statistics from Custora, which provides predictive analytics for retailers including mobile, showed that one in three purchases during the 2013 holiday shopping season were made from a mobile device, up from 1 in 5 in 2012. And for brands seeking to increase their customer engagement, a recent survey of more than 37,000 online consumers by Forrester Research found that users who accessed Facebook via a mobile app vs. a PC were more likely to read, comment on, like or share content posted by a company — and also thought more positively about the brand engagement experience.

 

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About Author

Kelly Hill

Editor, Big Data, Analytics, Test & Measurement
[email protected]
Kelly Hill currently reports on network test and measurement, as well as the use of big data and analytics. She first covered the wireless industry for RCR Wireless News in 2005, focusing on carriers and mobile virtual network operators, then took a few years’ hiatus and returned to RCR Wireless News to write about heterogeneous networks and network infrastructure. Kelly is an Ohio native with a masters degree in journalism from the University of California, Berkeley, where she focused on science writing and multimedia. She has written for the San Francisco Chronicle, The Oregonian and The Canton Repository. Follow her on Twitter: @khillrcr

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