The Value of POS Data: Hear from the POS Data Guy on the TraQline Podcast

Blog Posts, Competitive Business Intelligence, Hybrid POS™, SKU Insights, SKU Metrix™

How to Use POS Data to Your Business Advantage 

February 6, 2024
Ashley Jefferson Author 6 mins read
  • Facebook
  • Twitter
  • Email
pos banner showing a consumer's hand with a credit card in it as she pays at a kiosk

In an era where well-informed decisions can make or break business strategy, Point of Sale (POS) data is an essential to sustained success for retailers and manufacturers in the durable goods industry. 

The heartbeat of consumer transactions, POS data plays a fundamental role in how you manage your store inventory and personnel, and helping measure performance. The right usage of POS data is critical to understanding, analyzing, and predicting market trends — delivering actionable insight into the intricacies of consumer buying behavior and shifting product preferences.  

Join us as we dive into the strengths of this key consumer data source, the weaknesses you need to know, and ultimately how POS data provides retailers and manufacturers with an invaluable competitive advantage when navigating the complexities of an ever-changing market. 

What is POS Data? What Consumer Information is Collected? What Isn’t?

With the advancement of new data systems, POS data can now be broken into two categories: traditional POS data and competitive POS data. Let’s take a quick look into both.  

Traditional POS Data 

Traditionally speaking, POS data is any information collected from the terminal software used to process store transactions. Depending on the level of sophistication of a company’s terminal software, POS data collected from transactions can range from merely sales information to comprehensive data including customer details, store inventory, staff information, and more.  

What Traditional POS Data Delivers 

Notably, what these traditional POS terminal systems provide is invaluable data about your own business sales. This is critical information, as it allows you to track important sales key performance indicators (or KPIs) and monitor store, department, or company success.  

Notably, what these traditional POS terminal systems provide is invaluable data about your own business sales. This is critical information, as it allows you to track important sales key performance indicators (or KPIs) and monitor store, department, or company success.  

Limitations of Traditional POS Data  

However, given this data is internal-only, relying solely on traditional POS data systems can limit your understanding of consumer and market behavior. What these systems do not deliver is an understanding of what the market is doing outside of your business — and within the walls of your competitors.  

Competitive POS Data 

To make the most out of POS insights, businesses need competitive data. In comparison to traditional internal-only POS data, competitive POS data focuses directly on delivering a picture of the market and trends, looking at what products and brands are sold by retailers across the industry.  

This data cannot be derived from a traditional POS terminal system, but instead is most often provided by a data aggregator, who combines traditional POS data into a single source.  

This single source provides information to brands and retailers alike about consumer purchases, however it may come with some weaknesses that leave users feeling frustrated with the lack of comprehensiveness or transparency.

What Competitive POS Data Delivers 

Where traditional POS provides data about your own sales, competitive POS systems obviously provide information about you and your competition. For those retailers that participate brand volumes and percentages are available, as well as week-over-week, month-over-month, or any period’s changes in volumes.  

Limitations of Competitive POS Data  

Unless it is representatitve of the entire market — that is all retailers in the market are providing data — POS data cannot provide accurate market share.  

No single retailer will allow their volumes to be published, which means that retailers are grouped into categories such as “discount” or “specialty.”  

Additionally, the following drawbacks of POS data may be observed: 

  • Lack of visibility into derivative or retailer specific models 
  • No reporting for categories where there are less than 3 retailers reporting 
  • Misattribution of specific SKUs in the database due to transmission errors or retailer SKU errors 
  • Reallocation of volumes when retailers enter or leave the ecosystem 

A New Era: Hybrid POS, Competitive POS Data Insights — And More 

A new class of POS data has been created to draw upon the strenghts of competitive POS while eliminating the weaknesses. TraQline Hybrid POS delivers competitive POS data that go beyond traditional POS limitations, and overcome the barriers faced by other POS data providers. For example:  

  • SKU share at a specific retailer 
  • Derivitave model and private label models are shown without limitation 
  • Brand and retailer mix 
  • Feature trend information helps view and predict emerging market trends 

Furthermore, at the core is a massive PIM (TraQline SKU Metrix) that collects model information and pricing daily. 

How to Use POS Data to Your Advantage: Use Cases 

Whether gathering traditional POS data alone or combining it with the power of competitive POS insights, there are various ways to use POS data for strategy, decision-making, and growth.  

Here are five examples of how businesses can use POS data to their advantage, along with examples of insights that can be pulled from Hyrbid POS for each use case. 

Determine the top-selling models — in order to optimize product mix, inform new product development, improve store inventory, and countless other uses (shown below: top Front Load Washer SKUs by unit and dollar share).

chart1

Monitor pricing over time — which can be used to inform pricing strategy, promotions, inventory decisions and more (show below: avg. price changes over time for top Dishwasher brands).

Chart 2

Evaluate your business or product performance — to identify wins, losses, and optimization opportunities (shown below: Refrigerator share trends over time by brand).

Chart 3

Understand the market — by analyzing what consumers are buying, what features are popular, and other key insights (shown below: Side-by-Side Refrigerator feature preference split for top selling models).

Chart 4

Analyze your competition — and stay competitive with data on what they are selling and why (shown below: top 5 Dryer SKU ranks over time, across leading retailers).

Chart 5

What are Some Weaknesses of POS Data? 

As mentioned, POS data does not come without limitations. Aside from how POS data types can limit the insights available, there are also a few other factors that should be considered when choosing a terminal system (traditional POS data) or a data service provider (competitive POS data).  

While it is good to be aware of these caveats when choosing the right provider or system, it should also be noted that none of these weaknesses diminish the value delivered, or opportunities that can be uncovered, by taking advantage of POS data.  

That said, POS data can be negatively impacted/compromised by the following:  

  • The issue of retailer participation 
  • Inability to cover individual retailers  
  • Transmission errors 

Our competitive POS data system, Hybrid POS™ overcomes these limitations by being fully free of retailer participant constraints.  

Get the competitive POS data you need to win the market 

To learn more about our tool or see how we can help your business get the POS insights they need to stay competitive and sustain success, connect with us below.