I think she's a bit correct. You expect leaders to have a vision that is bigger than current trends. Retailers are at different stages of maturity and execution for sure and that matters a lot. But I see her point.This quote from her article is what spurred my thoughts here: "When executives proudly discussed achievements like knowing their shoppers’ hobbies or whether they use an iPhone or an Android device, all I could think was: Isn’t this simply the standard now that we’re many years into the era of Big Data? What retailer isn’t doing something like this, or at least trying to?"
Seems like investment strategy should be dictated by how tech and digital supports the retailer's delivery of a compelling customer experience. For traditional retailers with stores, that footprint woven into digital is probably going to underpin this. How it's architected and delivered though is based on insights reflecting the customer experience. It probably needs to be an ongoing effort, not a fixed end point, that gets tuned over time based on insights. Leading with a technology conversation is probably not the right approach.
I would say so. I have a lot of sympathy for what retailers are going through. In the past with less competition your experience could be very broad, almost indistinguishable from others, to attract a large audience. Today the mantra is all about knowing YOUR customer really well and crafting an experience for them. The challenge with that is targeting a particular customer while ensuring that a base of customers is sufficiently large enough to drive your business forward. And so you get trapped between trying to craft a compelling experience for a targeted customer and simply bolting on new service concepts to try and better serve that larger, but shrinking, diverse audience. Finding the middle ground to own and build upon is really challenging.
As an analytics use case, personalized marketing exists on a maturity curve. Most retailers are doing very simple personalization using facts about individual customers. When it comes to predicting the best content, offer, call to action, treatment strategy, etc., retailers should test new methods aimed at improving response and sales. It's not an either/or question, it's about how you go about exploring the capability and determining its business value before deploying it more broadly.
Unfortunately I think this is not such a simple question. Price and value, plus convenience, selection and overall experience must all be blended optimally to achieve positive outcomes with consumers. Low-price leaders are doing well but you might be able to group them as 1.) companies that embrace other elements of the mix besides price (like Walmart I’d argue) and 2.) those that are simply discounting in an attempt to keep customers.The retail success equation for high growth retailers of the future is complex but that’s precisely what leaders are using analytics to address.
As it relates to analytics and the use of new insights based on data, I think the key challenge is the operationalization of insight and the adoption by business stakeholders who are aligned with the different stages of the shopping journey.In my experience data science and analytics teams need better ways to activate their work. Ensuring consumers experience the value of analytics at the physical store level first requires that employees who have those face-to-face interactions leverage new insights as part of their day-to-day work. Making the use of analytics as transparent as possible -- to either people or systems -- is where I think brick-and-mortar retailers should focus their attention. In many cases this is simply too hard, costly and impractical for many retailers struggling with slow to no growth and slim margins who at the same time are pressured to test, experiment and transform their businesses while forces like Amazon continue to disrupt the retail industry.There's no better argument in my view for adopting cloud solutions enabled with the kind of embedded AI that helps businesspeople realize the value of analytics.
I agree completely, but he’s also right about most retailers being risk averse and uncertain as to how to best leverage data and analytics to improve individual shopper outcomes. Over the past several years retailers have rushed to acquire a lot of Big Data and analytics technology without a clear plan for accelerating development and operationalization of business-focused use cases. There is an art to this process that hasn’t played out at scale in most retailers, but must if analytics are to help retailers execute profitable and differentiated in-store experiences.
I think it makes complete sense. This question reads like an “inside/out” approach. Consumers/shoppers don’t care about cross-channel anything. However, it’s clear that they do care about: “fast response time to the customer’s needs and issues (52 percent identifying it as being critical). That’s more important than even a knowledgeable staff that’s always at the ready (47 percent) and rewards for loyalty (42 percent).” Those statements represent the consumer’s perspective, an “outside/in” approach that is supported through cross-channel recognition.
This question varies depending on the maturity of the organization. Larger companies tend to be well down the path with the right skills and technologies, but often struggle because not enough business sponsors participate in the process. Smaller companies struggle to move beyond very simple analysis because the skills required to drive the analytics are scarce. In either case, my view is that the rapidly maturing market for more packaged approaches to Big Data analytics helps organizations involve critical business stakeholders at scale.In most cases, scaling value creation around Big Data is the hardest part and is why the market is sort of teetering. In practice, this means new Artificial Intelligence capabilities that are embedded in the processes and applications used by business people every day. It’s here that the value renders at scale and you create the type of people who appreciate and have interest in engaging in more custom analytical projects.
Gearing your thought process around the consumer’s shopping journey and how both acquisition and engagement programs support these is a good place to begin. Then consider the current source of first-party data and insights about your customers. Progressive marketers in many industries are breaking down the barriers between paid media and advertising, and direct consumer engagement through email, mobile and social channels. Developing creative marketing approaches like those cited here and enabling them based on a single source of consumer insights to power owned, earned and paid media programs is a best practice.
I'm sure Jet does a very nice job using data and analytics to understand their online customers' journeys and architect the experience to be be enjoyable. I do think however that the organizations that work on the e-commerce site probably have little appreciation for physical retail -- either from the customer's point of view or the store associate's. I sense a real opportunity to provide a better omnichannel experience if the workers behind the online and brick-and-mortar stores have a lot more formalized collaboration.
Whole Foods will become a test bed for all of what Amazon has been wanting to test in physical retail at scale. To really understand and scale ideas like Amazon Go, Amazon needs access to real physical retail businesses and this is a fast path. Amazon then has the ready platform and real estate assets to scale what works and continue their retail growth path by taking share from slow moving traditional grocery retail. It’s starting to get a bit cliché, but retailers like those in the supermarket space need to start thinking more like technology and information companies. Otherwise, the lack of other businesses to hedge against like Amazon has will result in wishy-washy efforts that don’t yield any gains and the outcome becomes inevitable.
Price is never going away as possibly the top consideration for most products and this technology will only reinforce this reality. It places immense pressure on retail to be super efficient and responsive and equal pressure on retailers to understand their customers. Some retailers will try to get out in front of price by proactively engaging their customers in a value-added relationship based on interests, life-stage or lifestyle. If they don't then it's too easy for a customer to transact with the lowest-cost provider.
Seems like it creates too much friction, process wise, to be a really high-scale activity. It's a good test however, and I would expect part of their goal is to simplify the experience based on what they are learning. That's as good an objective as anything.
Another way of looking at this is the cannibalization of in-store sales by e-commerce channels. That is the flip-side of the cost problem described here. It suggests to me that retailers need a finer understanding of how their individual customers want to transact with them and design a business around that which can adapt over time. I know that's very hard, but the future of retail seems all about greater specificity in terms of a market/demand focus that is powered by data and analytics.