01-top
circle-cta

3 ways retail POS data improves your profits

Michael Poyser
blog featured image
01-bottom

In retail, smart business decisions that lead to growth and success are founded on solid data. And your point-of-sale (POS) system is a data gold mine.

However, POS systems are often treated as nothing more than a tool for receiving payment. The true value of retail POS data is something that many retailers haven’t even realized yet, let alone taken advantage of.

What is retail POS data?

Retail POS data is any data you collect when a customer makes a transaction in your stores or online. The data generally falls under one of eight categories:

1. Transaction data
This shows your gross and net sales, average order value, items per order, and more, at both a micro and macro level.

2. Product data
This data reveals the products that generate the most profit, how much of a particular item you’ve sold, and how much revenue an item generates.

3. Customer data
Customer data is the key to learning more about what customers buy, how often, how much they spend, and how long they’ve been buying from you. Customer data is created through tracking a customer identifier – most commonly via a loyalty ID, but this can also be achieved through a payment token.

4. Location data
From location data, you can discover more about the store where a transaction took place, including region, the type and size of store, and even individual tills.

5. Time data
Time data enables you to look at data historically to analyze and learn from past campaigns.

6. Promotional and coupon data
This shows you which multi-buy or pricing promotions were applied for a transaction and whether a customer was issued or redeemed a coupon when checking out.

7. Metadata
POS data taken from the receipt can also provide some useful metadata, including cashier ID or name, store address, etc.

Read our eBook 'What is POS data? The complete beginner's guide' and discover  the opportunities POS data has to offer retailers. 

3 ways you can drive increased profits with retail POS data

Gather and analyze data efficiently, and it will unlock insights that can help you boost your profits.

1. Get personal with your promotions

To personalize your customer experience, you need retail POS data. It tells you about how your shoppers behave and what they buy from your stores the most. Not just at a macro level, but down to individual customers. This data provides new opportunities for personalized promotions and targeted upselling.

For instance, you can give a specific customer a real-time offer for other items that complement their favorite products. Let’s say your retail POS data shows that a customer – John – buys eggs from your stores on a regular basis. You can use receipt marketing to target John with offers for milk or cheese at a discounted price.

Relevant, meaningful, and highly targeted offers drive loyalty. They give shoppers a reason to keep coming back to your business. And they can encourage increased spend. Your POS analytics might show that John is spending $25 on average every time he visits your stores. You can encourage him to stretch to $40 with a coupon that offers $5 off when he spends $40 or more.

Personalization is now a priority for retailers. 91% of consumers are more likely to shop from brands that recognize, remember, and provide relevant offers and recommendations. If you can reach every shopper with personalized offers driven by data and analytics, you’ll differentiate your customer experience and boost your bottom line.

2. Take control of your inventory

Inventory management matters. Having the right stock in the right place at the right time plays a major role in a retailer’s success. Inventory management continues to be a complex challenge for retailers, but POS data can help.

While POS data can’t track inventory levels perfectly, it can be an effective way to predict how much of a product is on the shelf. For example, you might have a product that you’d normally sell 20 units of in a day, but one day you notice that you’ve only sold two. This indicates that the product probably isn’t on the shelf.

With these insights, it’s easier to ensure you don’t run out of stock for your best-selling items.

3. Help your staff to sell more

Every interaction between customers and staff at point of sale is an opportunity to engage the customer and encourage their loyalty to your store. It’s also an opportunity to deepen their engagement, by making them aware of related products or promotions that they might be interested in. But how do you know who’s making the most of those opportunities?

Staff data from your POS system lets you track metrics on individual staff members. These cover everything from their average order value to the number of discounts they’ve processed. You can also track the proportion of their customers that swipe their loyalty card or request a digital receipt – both will be higher with highly engaged staff members.

By analyzing staff data, you can pinpoint which staff members are underperforming and could improve with the help of additional sales training. You can also identify your top sales performers and offer rewards to incentivize revenue growth.

Harness the power of your retail POS data

Your point-of-sale system can be more than a regular cash register. POS today is a powerful tool. With the help of the right analytics software, you can use the data it captures to improve your inventory levels, enhance your operations, and make smarter business decisions that drive profit.

New call-to-action

02-bottom
quarter-circle

Sign up to our blog digest for the latest articles straight to your inbox