‘BIG DATA & TECHNOLOGY AND WHY KENYAN RETAILERS ARE SEEMINGLY LAGGING BEHIND.’

Jeff Bezos is again the richest man in the World. His wealth has mostly to do with retail and e-commerce, or at least that's the genesis of it all. He currently boasts of a net-worth of  $108.9 billion, making him not only the richest man in the World but also the richest man ever in history. In case you have never heard of the guy (and you must be living under a rock if so), Jeff Bezos is the founder and current CEO of Amazon.com. He founded Amazon in 1994 which started as an online bookstore before eventually venturing into other products and services.  Today, Amazon is the largest internet retailer company in the world measured by both market capitalization and revenue. At only 54 years of age, he has built an empire and lasting legacy for himself. Over the years, the multi-billionaire has also ventured in other sectors like the media (he bought the Washington post in 2013) and aerospace among others. 

Technology

One of the reasons why Amazon continues to be a leader in the market is its agility to adapt to market needs especially when it comes to technology adoption. The world is now experiencing perhaps the most interesting phase of technological evolution. Ubiquity of the internet, the Internet of Things, e-commerce, artificial intelligence, augmented reality to name but a few are some of the major advances in technology that may have seemed like a dream less than a couple of decades ago. These advancements should without a doubt, spell out good news to industry players. "Not only is the IoT growing, but its boundaries are actually moving! Just as the advent of wireless roaming improved Internet access, the implementation of mobile networks is changing the psychology and behavior of consumers and businesses by expanding anytime, anywhere, on-demand access,"Cisco. Inc. Leveraging technology will assist those in business not only in the marketing of their products and services, but also in their day to day operations and daily decision making. A great example of in store technology adoption is by Amazon Go, the latest retail novelty by the company. This is a kind of a store by Amazon that does not require the customers to check out at the cashiers. This means as a customer, you don't have to wait in line to pay for your goods. Clients use the Amazon Go app in the store while at the same time the store uses their Just Walk Out technology to detect when products are taken or returned from the shelves. They then keep track of the items in a virtual cart using the same technology. Magic? Not by any means. What the company has actually incorporated in the stores is the use of deep learning, sensor fusion and computer vision. This is the same technology used in the manufacturing of self-driving cars, but in this case used to make your shopping experience easier, faster and hustle free. By keeping up with technology Amazon is able to keep their in-store clients happy by making their shopping experience easier and more effective. It may however be too soon to roll out the Just Walk Out technology in Kenya’s retail outlets, but there are still many other ways in which Kenyan retailers can incorporate technology in their businesses.  For example, IoT can be used in automated stock taking and in the process leading to a reduction of pilferage. IoT, an acronym for Internet of Things, refers to the process of connecting physical objects which are embedded with sensors to the network.  Stock taking would in this case entail the use of RFID (radio frequency identification) inventory tracking chips.   E-commerce adoption by the major retail outlets in the country has also been relatively slow. A quick online search for these chain stores and you will realize that majority of them don't have functional websites. An extremely astonishing reveal. The few that have websites had not incorporated e-commerce. Only about 10% of the chain stores are making use of e-commerce. E-commerce is huge currently across the globe due to an explosion in the usage of smart phones and consequently mobile apps. The 21st century customer is seeking prompt service and convenience with similar equal measure they seek quality. Most consumers who don't necessarily enjoy shopping like I will without a doubt appreciate the load taken off by online shopping. The hustles abated by the option of doing your shopping from a mobile app or from a desktop in the comfort of your office and have it delivered to your doorstep are countless.  A shopper gets to avoid traffic jam (and even possible road rage), having to look and pay for parking at the nearest mall/supermarket as well as avoiding the long queues at the supermarket. Again, chances are you don't have to walk/drive all the way to a store only to find that 5 out of the 10 items you were looking for are not in stock. Kenyan retailers need to start venturing into ways in which they can incorporate e-commerce and technology to not only improve on the clients' experiences but moreover to boost their sales.  

Big Data

Internet world stats show that Kenya currently has a population 37.7 million internet users. This makes our country's internet population penetration the highest in Africa at 77.8%. Kenya is actually ranked second in percentage use of the internet in Africa standing at 10.9% after Nigeria, which is ranked first in internet usage in Africa at 27.7%. Nigeria's total population is, however estimated at 191.8 million people compared to Kenya's total population of 48.4 million people. What this translates to is that, a greater number of the Kenyan population has access to data and information. Yes, we are in the era of data explosion, the era of big data. Big data refers to extremely large data sets that are complex to process using traditional methods. The data pyramid also known as the DIKW pyramid (Data < Information < Knowledge < Wisdom) shows how having the right data and processing that data can be used for business intelligence which is a very critical element to success in business. Large and even small organizations can no longer afford to make decisions blindly. Data driven decision making is the surest way of not only staying ahead of your competition but also in the advancing of the operations of modern day businesses. Walmart is a leading American retail company with over 11,500 stores worldwide and 10 active e-commerce websites. This is a great achievement for a company that started as a single credit store in 1962.  According to the Global Customer Insights’ analysis, the company gets over 300,000 social mentions every week. Of course, the American retail giant has had to adapt to the changing times in order to stay ahead of the game. Besides embracing e-commerce, Walmart has invested a lot in analytics and business intelligence. Walmart relies on data analytics in their pricing of their products, planning their discount promotions, managing their supply chain and product assortment in stores among others. One of the business intelligence techniques in practice is by Market Basket Anaysis (MBA). MBA is essentially a learning algorithm (unsupervised) which uses association rule mining to determine the purchase patterns of customer and consequently in prediction of future purchases by the clients. In other words, by studying historical data, the algorithm is used in the prediction of future patterns and can hence be useful in cross selling or even in recommender systems in the case of e-commerce. Retail chains, collect massive amounts of data every day, either through social media data, data from smart cards as well as everyday transactional data. The Kenyan players, nonetheless, are oblivious of the fact that they are literally sitting on a gold mine.