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Making the most of retail analytics

In retail, there’s no shortage of data. The challenge isn’t finding data, but gleaning actionable information that will increase profitability. Using information to increase operational efficiency has been a goal for years, but the new frontier is a better understanding of the consumer for improved delivery on the brand promise.

 

While the focus on operational efficiency remains, there are new opportunities to use Big Data analytics to monetize retail data. In order to better understand these opportunities, we recently spoke with Cindy J. Rogers, Principal Consultant, Retail Industry Analytics and Data Management, Strategy Services for HP.

 

124579-Consumer__Spri_selected-pages.pngES: It seems like retailers have always had information to backend data, which has helped them drive efficiencies, but it’s only been recently that consumer data and more real-time analytics have been readily available to help retailers make better business decisions. Is it safe to assume that this is a new area for many retailers?

Cindy: It’s important to remember that consumer data has always existed—in the form of focus groups and customer surveys and so on—so being customer-centric isn’t a new concept for retailers. However, technology advances and real-time analytics have moved that transactional knowledge closer to the sale.

 

But I also think we should adjust our reasoning for a second around backend data. While it’s true that many retailers have been working for the past decade with backend data, there’s still a lot of work that can be done to help retailers really filter what that data means. Now, of course, we have access to social media data, which can become very important for many of the business functions and the decisions they make. For example, in high fashion or electronics, there’s often tight allocation of product available. Therefore social media insights become very important in helping retailers tailor product allocations to stores or fulfillment locations where the trend or product attributes are all the rage!

 

ES: Do you think there’s a heightened sense of security around how much information a consumer is willing to volunteer about themselves, either on social channels or with retailers?

Cindy: Well, there’s always going to be concerns about privacy. I think the more consumers are comfortable with technology, the more they are willing to accept. Consumers are savvy. And most segments are very in tune with the fact that their online exchanges are being listened to and tracked. What was interesting this holiday season is how much retailers learned about the consumer tolerance for targeting. This past holiday season there was a record level of personalized, targeted communications going out to consumers—either in email or social media—that took consumers by surprise. And there was a sense among retailers that a high-touch level of interaction became irritating to consumers. Now I’m seeing retailers becoming more cautious of how much they interact with their customers and how much they send messages that say “We know you so well, we’re suggesting this product or service to you.” I think that type of reach has become a distraction for consumers, and retailers are responding in a more balanced manner.

 

ES: How to you think that 360-degree view of the customer helps retailers get them into bricks-and-mortar stores, rather than shopping exclusively online?

Cindy: First of all, people are always going to shop at stores. For many it is a social activity, or immediate satisfaction or need. Sometimes a retailer will let a customer know that what they are looking for is available at a store near them, but I think the key is the solution or service the retailer offers. A strong, knowledgeable staff of sales associates—coupled with an interesting in-store service such as photography tips for that new camera—will drive a customer off-line and into a store. Customers also shop for solutions—for example, a complete outfit pulled together by the trusted fashion advisor, or advice on the right software for that small business owner that just purchased a new laptop.

 

Retailers can use the data they have about their customers to delight those customers by demonstrating they understand how the customers in their area are unique. In that sense it’s all about localization and building a knowledgeable and empowered staff.

 

ES: Finally, how does HP help retailers—and consumers—have a better experience?  

Cindy: First of all, it’s critical that retailers are able to integrate the data from all the various functional areas, whether it’s integrating online data with your retail stores, or analyzing the data to create efficiencies in your supply chain. All that data needs to be integrated where it matters.

 

The key there is where it matters.

 

And HP can help with that. Retailers need to use real-time analytics only where it makes sense and brings value. For example, real-time analytics can be remarkably helpful in adjusting inventory or pricing to customer demand. However, adjusting labor based on real-time data without additional insights can put a retailer in a bind and create a poor customer experience.

 

It’s also important for retailers to remember that HP itself is a retailer. In fact, we are the only analytics consulting services organization that knows how to sell products, execute on day-to-day operations, and understand business issues. Our power center is the fact that we are successful at bringing and end-to-end understanding of the process to our customers.

 

Rogers.jpgAbout Cindy J. Rogers

Cindy joined HP’s Analytics organization in January 2013 as a Principal Business Consultant and lead Retail Industry Strategist. Cindy’s responsibilities include providing customer-centric thought leadership and industry subject matter expertise in the development of innovative and sustainable solutions to support retailers in critical decisions and challenges faced both upstream and in all customer touch points. 

 

Cindy is a proven retail leader with more than 30 years of extensive experience in vendor relations, inventory management, supply chain leadership, retail operations, P&L management and key initiative development and implementation. Retailers that have benefitted from Cindy's leadership include Walmart, Best Buy, Footlocker, Dayton's/Marshall Fields and Target. 

 

 

 

RETAIL.pngTo learn more about how HP is helping the Retail Industry, check out the most recent version of HP Industry Edge devoted to retail.

 

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