Your point of sales – or POS – system is capable of doing a lot more than just processing transactions. In fact, it should act as the hub of your entire business. You can use it to track inventory, process payments, manage employees, and more.
Knowing how to use POS systems to their full advantage can even help you improve your marketing campaigns. Leveraging POS data may sound confusing, but it’s actually a lot easier than you might think. Here are a few ways in which you can use the data from your POS system to improve your marketing strategy.
Why POS Data Is Important?
If you aren’t already using the data from your POS to make important decisions in your business, you may not understand exactly why it’s so important. Your POS system collects data related to things like inventory, transactions, employees, etc. This data can be analyzed in real-time to make informed business decisions.
While you may have a tendency to “follow your gut” and make important decisions based on what feels right, leveraging data allows you to make decisions based on facts rather than feelings.
While many business owners worry that reading and analyzing POS data is too challenging for the average person, this simply is not true. Most modern POS systems are designed with user-friendliness in mind.
They are made for average business owners and typically generates reports that are easy to understand and use. They are also usually capable of generating reports that are focused on just a few key pieces of information. This makes it easy for you to find what you are looking for quickly and make smart business decisions without finding yourself buried under heaps of information you don’t understand.
How Your POS System Can Guide Your Marketing Decisions?
Your POS system collects a lot of data that can be used to help you better understand how all the components of your business work with each other. Being able to see and track various data allows you to see the influence one part of your business has on another. This helps you make informed decisions regarding things like marketing.
There are several marketing tactics that can be handled by your POS system. You can use your system to manage email receipts sent to customers, loyalty programs, gift cards, coupons, and more. Your system will collect data that you can later use to determine which marketing tactics work and which don’t.
Keep reading to discover a few specific ways to leverage POS data to improve marketing campaigns for your small business.
1. Customer Segmentation
Use the data from your POS system to better understand your customers and their individual experiences with your products and/or services. You can do this by creating customer profiles in your POS system to track purchases. With a loyalty program, you can see exactly what each customer is purchasing and how often.
With this information, you can create segmented marketing campaigns for specific customers. If, for example, you are a retailer and have several customers who frequently purchase baby items, you could create a home mailer campaign featuring a coupon that can only be used on baby items.
While you may not have the time or financial resources to create a marketing strategy for each customer, segmenting your customer base enables you to tailor your tactics to better appeal to specific groups.
2. Accurate Pricing
Coming up with prices for products and services is a huge challenge for many business owners. As a result, they often rely on their gut feelings or trial and error. Unfortunately, these methods usually don’t work out well. Establishing the right prices is crucial. By leveraging data from your POS system, you can set prices with confidence.
This data can also guide you when changing your prices by allowing you to see exactly which pricing strategies are working and which ones aren’t.
Consider your goals. Do you want to increase impulse buys? Attract new customers? Increase your operating profits? With these goals in mind, take a look at the data to get a feel for what items are selling best. If you offer products in different package sizes, pay close attention to which ones are selling the best.
Experiment with offering sales and promotions, and see how the data changes. There is still a bit of trial and error involved, but by leveraging the data from your POS system, you can get a much clearer picture of what’s working and what isn’t.
3. Improved Forecasting
Marketing campaigns are typically planned months in advance. Since you aren’t able to peer into the future to see what customers will be buying several months from now, you need to be able to forecast buyer habits with some degree of accuracy.
With the data from your POS system, you can get a feel for what customers are buying at certain times during the year. If, for example, your data shows that you sell a lot of umbrellas in April, you can reasonably predict that a sale or promotion on umbrellas in April would be a hit among customers.
You can also use this data to analyze when sales are down. If you find that your business typically hits a slump during a certain time of year, that time of year may be a good time to offer your best possible prices to boost sales. While you can’t actually look at the future, using past data can enable you to forecast future trends and make informed business decisions.
As a small business owner, you need to make a lot of important decisions on a daily basis. While making the wrong decision may not be a huge issue for major corporations, it could spell disaster for your small company.
By leveraging the data from your POS system, you can make informed decisions regarding your marketing campaigns. In doing so, you can strengthen your marketing tactics and grow your business.
If you aren’t currently leveraging POS data when making marketing decisions, spend some time learning how to use POS systems to their full potential and how to generate useful reports.