How Geospatial Data and Locational Analytics Help Retailers Leverage their Big Data


COVID-19 has left many in the retail world in a bind. Between ongoing supply chain difficulties, an energy crisis, and record inflation rates over 9%, there is enough uncertainty to go around.

Furthermore, COVID-19’s often-reported acceleration of digital trends has surfaced a  need to integrate the newest generation of ‘big data’ sets, generated effortlessly, instantly, and seemingly exponentially from growing digital markets.

Topping it all off, while many retailers know they need to perform a digital transformation, they either don’t have the in-house talent or are struggling to acquire it in a deeply competitive tech skills market. 

What options are there in the face of these challenges for retailers looking to continue driving their sales growth?

One answer is to seek third-party data consulting and analytics services to bring all of that disparate data into a coherent story, one that tells retailers who their customers are, where they are, and what they want.

Geospatial mapping and locational analytics–a form of data analysis that examines data from a geographic standpoint and allows for store and product optimization and personalization. These tools can finally make all of that data work for you.


Why Geospatial Data Analysis?

Geospatial data as defined by IBM Analytics is data that “typically combines location information…and attribute information (the characteristics of the object, event or phenomena concerned) with temporal information.”

Geospatial analytics, meanwhile, adds those temporal and location data types to more traditional types of data to build visualizations that can help explain why things happen where they do. This is invaluable insight for l to day-to-day users.

In retail, this means management can get a geospatially enabled look at both short-and-long-term data points such as hyper-localized foot traffic or local demographic characteristics and human movement. 

Yet, reticent decision-makers might ask why they should adopt ‘yet another data stream’, given how overwhelming existing data streams are and given concerns over the existing costs of its collection and analysis.

All retail data is geospatial in nature…every transaction [includes geospatial data]. GIS (Geographic Information Systems) is about looking at your data…to find [geographic] patterns in that data,” argues Gary, Industry Manager at ESRI, a data analytics firm that focuses on leveraging maps geospatial data via ArcGIS, a flexible software platform for the kind of data visualizations that make this data useful.

  “Customers don’t visually see their data,” adds Emily, Senior Solution Engineer at ESRI. “They’re using spreadsheets. If you’re not mapping, combining data points, and running analysis, you’re missing so much.”

GIS is capable of delivering those crucial visualizations in a way anyone can appreciate; by making data accessible it can then become leverageable on a day-to-day level by most anyone. “The human brain doesn’t work in rows and columns,” notes a report by Deloitte.

What bringing all of these ‘geospatial influence factors’ together facilitates lies at the very heart of what digital transformations are seeking: “Geospatial…can bring in a lot of unstructured data and structure it around a location [as a starting point to tackling huge swathes of big data]. Predicting, forecasting…this is an exercise in correlations [and something GIS can provide],” notes Gary.

Indeed, it’s the very characteristics of today’s endlessly complexifying, intricately-interconnected, and big-data-centered global marketplace that are truly leading the charge to leverage geospatial data.

“Customers are scrambling to understand the new market…The wealth of customer data that is now collected through online orders is a form of instant feedback. All of that is spatial,” remarks Emily.

In brief, GIS allows not just for (1) better data insights that engage in analytic dimensions that will be (as yet) underutilized by competition, but (2) foresight in increasingly uncertain marketplaces (and climates) coupled with (3) the ever-sought-after granular data personalization digital transformations demand. 


Why Knowing Where Your Customers (and Products) are is so Critical

By knowing who your customers are and what they want, you can cater to your market while optimizing regional supply networks to ensure what they want is stocked in each of your stores, goals which form the core of effective marketing.

Geospatial data allows analysis to direct their gaze directly at those goals, and can even help management to know when (or whether) to open new stores by (e.g.) analyzing local real estate and business data to determine whether a particular spot is good for business in a way that goes beyond intuition and appearances.

For one grocery client, GIS enabled them to notably increase sales and product/marketing localizations that targeted the people who actually lived in their area: “…certain ethnic foods were either not selling or they were constantly sold out. [ESRI] did an analysis not only on customer behaviors [and local] demographics but their competition,” notes Emily.

“For stores that [that analysis concluded] over-indexed in Hispanic customers, they were able to personalize their stores [as well as] their messaging [to account for language differences]…they saw a lot of positive feedback…and better sales.”

            Continues Emily, “this data is useful to understand social equity [by ensuring stores reflect the people they serve],” an issue often cited as critically important to younger consumers.

GIS can also assist in tackling other major issues for retailers surrounding sustainability, supply chains, and labor issues.

The labor market was drastically worsened by COVID-19. GIS is capable of informing decision leaders on whether a new store might encounter labor issues, as can it provide human resource teams with the tools they need to help mitigate issues with their existing staff, preventing greater turnover rates. 

Sustainability, meanwhile, is an issue of rapidly growing importance around the world according to Pew Research, views that are even reaching Americans in greater numbers. 

Yet, data indicates this concern isn’t uniform: in response, GIS allows retailers to know how much local shoppers actually want to see  sustainability labeling or not.

Even more critical to true sustainability is the impact GIS can have on creating more sustainable supply chains. GIS can help to determine (e.g.) whether your local producers can meet your needs (or how you could support them to do so sustainably) in a critical effort to localize supply chains at a time when globalized, ‘just-in-time’ production systems are being tested more than ever.


GIS Makes Leveraging Data Stores Have Collected Forever Possible

However retailers leverage GIS, it needs to be reiterated that this isn’t some new data marketing scheme: geospatial data is already a part of everything a retailer does. If a manager has ever wondered whether their customers are going, what isles they’re stopping in, and where they’re coming from, geospatial data answers this.

           What analysis tools such as ESRI’s ArcGIS do is make those data streams accessible. Retailers who best understand the ‘who, what, when and where of their business will be best equipped to execute meaningful data personalization initiatives that actually drive sales.


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