The headlines continue to feature retail meltdowns headlined by Sears, Toys R Us, Walgreen/Rite Aid, Gap, Mattress Firm, et al. Yet online etailers are expanding their brick-and-mortar presence, most notably Amazon books and Amazon Go, Warby Parker, Bonobos and Caspar. What’s the key to brick-and-mortar success? Data, finds a new study by Harvard Business Review and Snowflake Computing. Companies that make data-based decisions have the best chance to survive. However, the study found that only five percent of retail and consumer packaged goods companies are considered data-driven.
Retailers across all spectrums should consider that they need to obtain better insight into customer needs and expectations in order to speed up their decision making while improving processes and cost efficiencies. However, few companies with these stated goals are actually making inroads to achieve them, primarily because they do not believe they have the analytical abilities to change. The HBR/Snowflake Computing survey results were mirrored by a Retail Systems Research July 2018 survey that found retail winners believe that data is a strategic asset and critical to their retail success.
Not surprisingly Amazon and other competitors encroaching on their market were cited as the top business challenge driving innovation, according to the Retail Systems Research survey. Other areas where data-driven retailers are out performing others are:
- Operational efficiencies needed to fund customer initiatives
- Ability to meet the rising customer expectations
- Investors demand for innovation
- Retailers with long term leases need to develop strategies to become more productive
- Other retailers moving more quickly
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