4 Data-Related Challenges Retailers Are Facing in 2019
The past decade has shown immense disruption in the global retail industry. This has forced retailers to fundamentally shift their business and technology strategy and re-focus to stay relevant and competitive in a rapidly-changing marketplace. Few factors have undergone more dramatic change than the importance of data to a retailer’s success. To be sure, the explosive growth in retail data can be a curse for retailers. But, if managed and analyzed properly, data can also be a blessing – a strong competitive advantage for retailers looking to grow and win in a radically changed retail environment.
However, in order to rule in today’s hyper challenging retail space, retailers must first understand and then address the challenges created by the overload of retail data.
Omnichannel: Gone are the days of a single shopping peak in a store’s day. Now after the 6:00 am shelf stocking comes the 9:00 am “click & collect” inventory pull, which can result in empty shelves for the 4:00 pm prime-time period for in-store shoppers. Ultimately, the store’s physical shelves must hold the inventory for all channels – in-store, pickup at store, delivery, and e-commerce – if the brick and mortar store is to survive and thrive the growing shift to omnichannel.
While stores are equipped with endless technology – POS and CAO to name a few — the challenge is figuring out how these systems can support omnichannel shopping at the shelf level. This all has to be done from one end of the supply chain to the other, beginning at the shelf. And, as every retailer already knows all too well, it has to happen yesterday!
Supply Chain: With the complexity, uncertainty, vastness and speed of today’s end-to-end global supply chain, retailers need to be even more connected. From merchandising and supply chain, to operations and finance, every team needs to be on the same page and collaborating with all vendors and carriers like never before. There is no margin for error in the modern day retail supply chain. It’s all about granular, timely and accurate shelf level data delivered how and when you need it. Ideally, the store/item/day level of data needs to become actionable as soon as it’s received.
Digital Transformation: Digital transformation has brought about this need for fast, actionable data insights – a significant challenge by itself. But, according to a recent study by Gravity Supply Chain Solutions, 85% of retailers in the U.S. have not digitized their supply chain. Not only does this mean that a large majority of retailers are losing efficiency in their supply chain, they’re also leaving hundreds of thousands of dollars (millions on a cumulative basis) on the table. Retailers are not doing without supply chain technology without a reason. The above referenced survey found that 54% of retailers believe that the customer experience is the driver preventing change. Another 40% say that some combination of cost, difficulty with ROI, and system integration, is a major roadblock to implementing more digital supply chain methods.
Consolidation: The retail landscape is constantly evolving, thanks, in part, to consolidation both up and down the supply chain. What has yet to be seen is how all of these changes impact the smaller retailers and how all the consolidation will affect the consolidators themselves (the wholesalers). Given all of these trends, it’s yet to be seen how the supply chain will be affected, including how the data will flow.
Retailers are already able to collect massive amounts of data on a store and item level every day. However, the challenge with this deluge of both structured and unstructured data is how to turn it into the knowledge that provides critical insights that can be activated and executed on, from the supply chain to the store shelf. By creating actionable insights through the timely analysis and management of current data, retailers can significantly impact their bottom-line by millions of dollars, ensuring their profitable growth and long-term success in a historically challenging retail landscape.
We’ve put together a checklist to help retailers assess their current data management and analysis strategies so that they can achieve greater success and growth in the years to come. Download our newly released Data Analytics Checklist: How to Maximize Your Growth, Profits & Success.