Top Five Strategies in Retail Data Analytics
The NRF “Big Show” was a huge success and for those of us who are working to leverage retail data analytics to personalize the customer experience, increase brand loyalty and grow revenue, there were a lot of great insights and best practices. The overarching theme of the show was enabling retailers to be more successful, through better hiring and nurturing of talent, supporting struggling Brick and Mortar business, and creative thinking around omnichannel and digital channels.
We expected retail data analytics to be a hot topic and we were not disappointed. We are in the midst of a period of rapid innovation where retailers around the globe are harnessing the power of data to improve their ability to drive two key trends effectively engaging millennials and improving the customer experience.
As always, NRF was filled with great speakers, panels and hallway discussions about trends in retail:Disruption in the marketplace due to new and diverse data types Dramatically changing in-store and on-line shopping experiences Engaging millennials through social media.
Here are five key takeaways from the Big Show to help drive retail success:1. Retail Data Analytics is a faster path to success
We heard from many experts at retailers like Home Depot and Neiman Marcus about the importance of collecting, storing, and leveraging data to drive business especially when targeting the elusive generation of Millennials. We know that data drives behavior, and can identify revenue spikes, out-of-stock conditions, and targeted promotions to select consumers.
Expert Tip: If you are just beginning to use your data to develop deep insights, learn about what others are doing. Start small. Begin by getting all the data in one place and making it available to your business analysts.2. Improving the customer experience with data
The Manager of the NYC Sonos store, which includes a Sonos interaction lab spoke about how to immerse consumers in an experience that builds loyalty and rewards time in-store. With so many brick and mortar chains struggling, it’s critical to stay relevant in the consumer’s mind. Sonos leads the way in best-in-class audio equipment, and is maintaining this leadership through intimate consumer experiences that drive revenue.
Expert Tip: Zulily is creating engaging, unique, and compelling experiences for its customers, primarily moms, by understanding what she wants and showing her the right product at the right time. Zulily has combined open source Apache Hadoop and cloud computing to deliver a highly scalable connected data platform for structured and unstructured data. This allows Zulily to scale both storage and analytics on demand, and accelerate decision making processes.3. Focus on a few high value technology projects
Mike McNamara, EVP and Chief Information and Digital Officer of Target spoke about technology transforming his business. Target needed to cut down a weighty workload of 800 technology projects when he joined the company. In order to create priorities, each team got five post-it notes. A creative collaboration and prioritization session enabled Target to move from laggard to leader, driving greater impact through fewer projects. Leveraging open source technologies is one of the retail data analytics priorities at Target. In addition, they religiously use Agile methods to focus on a few projects to achieve success.
Expert Tip: Start small, execute, show value and repeat. Identify a use case that your team can tackle quickly and demonstrate realized business value. With today’s open source tools it’s much easier and more effective to analyze data from multiple sources and get valuable insights. At Hortonworks, we have Connected Data Platforms that dramatically reduce the cost of capturing, ingesting, storing and analyzing data. When integrated with existing systems and operations, retailers can analyze enough data to make statistically confident observations on empirical retail data, rather than rolling the dice with customer panels, in-store surveys or focus groups to guess what drives sales. In addition, our experts are able to augment your team’s skills, execute efficiently and capture and communicate value.4. Embrace technology or be left behind
Retailers must adapt. There were many technology booths showing automation, sensors, and robotics. Retailers operating in an old operating model are going to be passed up by new, modern concepts and ideas.
Retailers must respond more quickly in all areas. For example, sensing consumer movement in a store through beacons can help determine hot zones, cold zones, and dwell points to maximize assortments and impact revenue. Smart sensors can help you react to products being pulled from a shelf to improve loyalty and expand baskets. Retail data analytics and technology can also help you respond to inventory movement and sales figures in real-time. Having data feeds of both sales and inventory from stores enables better loss prevention control and shrinkage reduction.
Expert Tip: Retailers that geo-locate their mobile subscribers deliver localized and personalized promotions. This requires connections with both historical and real-time streaming data. Apache Hadoop and Apache NiFi bring the data together to inexpensively localize and personalize promotions delivered to mobile devices. Retailers can develop mobile apps to notify customers about local events and sales that align with their preferences and geographic location (even down to a particular section in a specific store).5. Forget Omnichannel. Digital worlds are merging and lines are blurring.
Online, offline, mobile. e-commerce, brick and mortar…. Shoppers aren’t thinking about whether they are on their phone, on their computer or in your store. They are ordering your merchandise in the easiest way possible and increasingly that is through digital mobile assistants. These are the new channels of interaction and service.
It’s expected that the Amazon Echo will be in 40 million homes by 2020. Combine this with the new Google Home device, and voice-activated smart phones, and the concept of channels has disappeared. Shopping has transcended a digital experience or an in-store visit. Gartner has predicted that by the end of this year, more than $2 billion in online shopping will be performed exclusively by mobile digital assistants.
These new channels need to be managed more closely than traditional channels, and in the midst of it all, consumers are crying out for better prices, more assortments, and a more personal experience.Drive for a Business Impact
It is more challenging than ever in retail, but the common denominator is data. By collecting, storing, and analyzing shopper sentiment, product movement, and consumer loyalty, retailers will improve their bottom line. We look forward to continuing the discussion with you.
I hope you will join me and my co-collaborator, Shish Shridhar of Microsoft for our upcoming webinar where we will discuss these trends and more learnings from NRF 2017. Look forward to seeing you there.Register for Webinar: Top 5 Trends in Retail Data Analytics