Dave Whittaker takes a look at how trendspotting tech can help retailers spot the trends that could boost their business in this new guest post.
To get ahead in retail, you need to be ahead of the curve when it comes to current trends. According to the stats, most small businesses will face the threat of closure at some point within the first ten years of operation. In fact, even if you can manage to avoid being among the 20% of small businesses that fail in their first year, the chance of failure only increases as time passes. By year 10, the chances of going bust are 70%, according to data compiled by InsuranceQuotes. But even long-established businesses are not guaranteed survival if they do not stay in touch with what customers want.
One of the main reasons businesses fail, especially in the retail sector where trends are constantly changing, is a lack of consumer insight. When it comes to bigger business, insight that they too can fail comes from looking back at In Search of Excellence (1982) by Tom Peters and Robert Waterman, 25% of the large companies featured in the book no longer exist. Despite passing the pair’s criteria of management excellence, even the likes of Wang Labs and Data General have fallen by the wayside since its release. The question, therefore, is how corporations that were once thriving came to lose everything?
Perhaps the most important aspect of business is information and trends. Indeed, while Wang Labs was once on top of the latest computing trends, complacency saw them fall behind the times. In essence, not knowing or understanding what customers want right now will destroy a company that was once thriving. Put simply, if you can’t stay ahead of the curve, you’ll fall behind it and, eventually, out of sight. However, it’s one thing knowing this, but it’s another actually keeping up with the times. Fortunately, there are things you can do to improve your chances of success if you look outside the retail sector.
Using Tech to Find the Curve
Technology is an obvious tool for those who want to identify the latest trends. Social media sites like Twitter, Facebook and Instagram are flooded with ideas, products and opinions. Social media influencers are, by nature, popular figures that have the power to influence others and turn the tide in favour of a particular product. Simply taking the time to look at what these people are doing will help you find the hot topics within your particular industry. Beyond that, artificial intelligence (AI) is set to become increasingly useful for retailers too.
According to research by Global Market Insights, AI in retail alone will be worth $8 billion by 2024. Of that total, IDC calculated that major retail firms spend $3.4 billion on AI in 2018. However, even for the biggest businesses, this fledgling technology can be expensive to implement on a mass scale. To bridge the gap, there are tools companies of all sizes can use.
For example, Acquisio is a piece of software that will analyse and manage pay-per-click success and make recommendations for optimising marketing spend. Using this technology, you can essentially see which adverts/products consumers are interested in and then tailor your offerings accordingly with the help of AI. Such tools can be utilized by businesses of all sizes, even those working on other AI implementations in-house. Along similar lines is the idea of group dynamics.
Technology’s Eyes Are Better at Spotting Trends than You
In trading, investors will use specialised software to analyse a market based on consumer behaviour. For instance, the algorithms powering Bitcoin Loophole are based on the Flock Principle. In other words, the software conducts a long-term evaluation of market influencers to predict where people will flock to. This process is also known as herd analysis, as it suggests that where one influential figure leads, others will follow. Applying this idea to retail, it’s possible to take data from a particular subset of a particular demographic and track what they’re doing.
An example would be YouTubers within the 18-25 age range. If the data showed these people were all hot on one product, the Flock Principle would suggest that everyone is likely to become interested in it. Therefore, as a retailer, you could invest in said product ahead of the curve and profit when it becomes the latest trend.
In essence, what you should be doing as a business owner is using technology to improve your timing. We can all spot trends. However, when we do, it’s usually too late. Technology, however, can pick up on micro signals long before we can. By using these to your advantage, you can not only get ahead of the curve, but stay there.