A study by market research firm Markets and Markets predicts that the retail analytics sector will more than double in worth to $4.4 billion within the next five years. The report “Retail Analytics Market by Business Function and by Solutions — Worldwide Forecasts and Analysis (2014 – 2019)” details some of the benefits of data analytics for retail, explaining why more businesses are adopting data management solutions.

According to the report, retailers worldwide lost a staggering $112 billion in 2012 to fraud and theft, from organized retail crime to shoplifting. “Thus,” reads the report, “a number of small and medium businesses (SMBs) and large enterprises are rapidly deploying data analytics tools that can provide effective prediction, analysis and reporting for alleviating shrink.”

In addition to reducing losses, data gathering helps retailers observe existing market trends. With proper analysis of said data, they can then identify emerging trends and even predict future ones. This can give a retail company of any size a very significant advantage over its competitors.

Markets and Markets believes that the recent financial crisis was the main factor that prevented retail analytics from growing earlier, as companies saw their profits reduced due to consumers’ decreased spending and did not have the resources to invest. But with the post-crisis recovery now well underway, the researchers say that the analytics sector will begin, and indeed has already begun, to grow exponentially. According to the report, retail analytics are currently worth about $1.88 billion.

Extract, transform, load (ETL) processes are an essential part of retail data solutions. Information needs to be gathered from an ever-increasing variety of different sources and converted to a unified database. Only then can it be adequately analyzed to draw the conclusions that will help a business better understand its market.