Mumbai: Croma, the speciality retail chain selling consumer durables and information technology (IT) products, realized a year ago that it wasn’t smartphones but sound products that were the top draw for its customers.
The chain, run by Infiniti Retail Ltd, a 100% subsidiary of Tata Sons Ltd, then created space at its showrooms specially for sound products, starting from Rs499. Earlier, these products used to be scattered across sections, said Ritesh Ghosal, chief marketing officer, Infiniti Retail.
Croma is also changing the product assortment at nearly a third of its close to 100 stores after analysing the customer catchment of each store.
The effort seems to have paid off. In the past year, repeat customers walking into Croma stores within 90 days of their previous visit has increased from 14% to 24% of all shoppers.
Croma’s is just one example of a Tata group company using Big Data and analytics to analyse consumer behaviour and tweak the way it does business. As many as 14 Tata companies are partnering Tata Insights and Quants (Tata iQ), a Big Data company incubated by Tata Industries Ltd 18 months ago, to analyse data collected from users and consumers and make sense of it to put changes in place.
In Year 1, some of the early partners of Tata iQ have added as much as Rs100 crore cumulatively to their top line by cross-selling, upselling or by making changes to better serve their customers, said Deep Thomas, chief executive officer of Tata iQ, in an interview.
At TataCliq.com, Tata group’s e-commerce venture, the conversion rate (a measure of how many visitors of a website actually buy something) has improved from 0.5% to 1.5% in the past year. Within a year of operations, the e-tailer has identified its core consumers to be working women who are 30-40 years old in the top 10 cities of the country.
“We have actually leap-frogged an e-commerce company’s journey by two years with the segmentation,” said Ashutosh Pandey, chief executive officer, TataCliq.com.
According to Pandey, e-commerce companies which launched 3-4 years-ago are now looking at what customer segments to target.
At Tanishq, the jewellery arm of group firm Titan Co. Ltd, the use of targeted carousel advertisements on Facebook led to a 30% increase in in-store sales among 25-44 year-olds, said Pulkit Trivedi, industry director for e-commerce, retail, travel and financial services verticals at Facebook India, at the India Fashion Forum in Mumbai in April.
The focus on Big Data and analytics in customer targeting is expected to increase under Tata Sons chairman Natarajan Chandrasekaran, who took over in February after spending three decades at Tata Consultancy Services Ltd.
The group will be using Big Data across functions ranging from manufacturing and operations to supply chain management and rural business.
“Data and analytics have taken a larger-than-life pole position in Tata group today compared to where we were a few years ago,” said Harish Bhat, chairman of Tata Global Beverages Ltd and brand custodian of the group.
According to Bhat, chairman Chandrasekaran is an evangelist of Big Data and analytics.
“In fact, when we asked him recently what is the single most important thing that marketers should focus on, Chandra answered ‘data, data, data’,” said Bhat.
“Data and analytics will no longer be one more thing we do, it will be central to what we do,” he added. “It will be a glue that will bind our organization.”
Use of data and analytics is still a nascent phenomenon at Indian companies.
“Most companies are doing static analysis—that is, they look at data at a point in time or periodic data and do analytics around that,” said Milan Sheth, advisory partner and technology sector leader, EY India.
These are areas that Tata iQ is looking to address.
“I think we are at the cusp of a transformation,” Thomas said in a February interview to Tata group’s in-house magazine. He estimated that by 2025, the Indian analytics industry will be close to $16-18 billion in size.
“Two or three years from now, as organizations compete on a global scale, Big Data will be a non-negotiable competency for every organization—they will just not be in a position to compete without the power of data analytics,” Thomas said.