Big Data is Changing the Game: Five Questions for Retail Leaders

by Bill Bishop

<< Previous Next >>

Recommend This Post 86

We’re excited to release the findings of BMC’s latest Big Data survey in a new report.  The results suggest five key questions that retail leaders who see value in big data should be asking themselves in order to capture competitive advantage.

1. How is your market changing?

How far have your customers moved online, and what does this say about what they’re looking for and not getting today?  

2. Where  are your biggest opportunities to win business?

It's important to bring a strategic focus to the decision of where a company applies big data. Don't forget to ask the big questions first.

3. Which communications channel will have the greatest impact?

While omnichannel customers want to communicate in multiple ways, some channels will have a greater impact than others.  Find out which channels your customers are using, then use test and learn to put the right tactics in place. 

4. How do you tap the creativity and power of your larger community?

Open up! One way to get the maximum value from big data is to share it with all who can add some value, from store employees and suppliers to customers. This will speed up identification and implementation of innovative strategies and tactics. 

5. What’s the best way for your company to capture the benefits of big data?

Here’s the dilemma: The retailer who moves first will capture the majority of the competitive advantage, but most retailers don’t have the capability to be first-movers. Partnering with innovative providers is a potential path, but it also requires balancing possible rewards with increased risk.

Check out the report below or download a copy. What do you see as the main messages for retailers coming from this latest research?  Are these five questions useful?  What else needs to be asked?

Tip: To enlarge the Slideshare box, click the 4-arrow symbol in the lower right hand corner. 

Related posts:

Recommend This Post 86


Comments RSS

BlackBeltDavid Lubert said:
The results of the Big Data Update are very insightful and further confirm many trends. One area that I believe is valuable is the use of big data to bundle services and communicate better with shoppers. I see this as very essential, in that developing a two way communication with your shoppers is key to long term success. I say this because the collection of data on shoppers I believe will be met with some privacy issues as this becomes more and more pervasive. I do believe retailers must be considerate about how they interact with their shoppers and having a two way communication that provides for bundling of services is one way to not intrude on a shopper's privacy.
BlackBeltBrian Numainville said:
While item-level movement data received the highest percentage indicating that it will improve supply-side performance, it is interesting to note that tracking in-store shopper behavior and shopper feedback were second and third, respectively. With all of the tools available to retailers to listen to shoppers (and take action based on what they hear) this is something all retailers should be engaged in. These tools are affordable and available today.
BlackBeltBob Sherlock said:
A very interesting set of findings! I was maybe most surprised by the % of respondents so far into their projects already.

Would be curious to know others' thoughts on the definition of "Big Data" as it’s not always clear that everyone using the term has the same definition in mind. In this survey, it appears to encompass internal sales data, and also data about social media tying back to websites. Anyone know of an authoritative definition posted somewhere online? Or willing to provide a definition yourself? Thanks!
BlackBeltBill Davis said:
Excellent summary and agree with everything except the weights on what's holding companies back from better leveraging big data. I would give higher weights, 7+, to lack of infrastructure, budget limitations and lack of data scientists. Most retailers have been underinvesting in technology for quite some time, , and its really starting to cost them.

"Coloring the situation is just how badly most large merchants misjudged technology. Back in 2008, Accenture found that retailers invested only 2 percent of their revenue in technology while most other industries invested two to three times that much. As they stood by, has amassed annual sales of $60 billion, six times the online sales of its nearest U.S competitor, Walmart."

Traditional retailers aren't prepared to reallocate the tens of millions of dollars towards more effective purposes such as investments in technology upgrades. Without these investments, their companies will stay flat at best and shrink at worst. And if you had the high end technical skill-sets for big data, would you rather work for a firm that's going to pay you at/below market or go to work somewhere where your pay package is based on the value you contribute?

This leads me to the only point I'd add which is most senior management teams aren't prepared for what's coming at them and its evident in how they are executing their strategy. To say there are budget limitations for technology investment is a crock. Most companies aren't willing to compete at the level Amazon is and its going to cost them. And the shortage of skill-sets means they are going to have pay well and make their work environment similar to what happens in Silicon Valley and Seattle (e.g. catered meals, flexible work policies, etc.) which most retailers aren't prepared to do.

My $.02 and am glad I am not working for a traditional retailer who's been slow to grow what's going on and make the necessary investments because most are about to get a bucket of ice water right in the face.
Bill Bishop said:
Bob, we did not specify a definition for big data in the survey. It was our feeling that it would be less distracting to let it be defined in “the eye of the respondent”, but agree we should have one.

Here’s a first cut that I hope others will add to and modify and ,in the process, improve.

“Big data in retailing” refers to all the information generated by the business and from sources external to the business that impact its performance that was not practical, or even feasible, to collect and analyze before the growth in open source community tools and cloud-based computer power.

Looking forward to having this definition made stronger, clearer, or just plain better.
Stephanie Halley said:
I agree with Bill Davis' comments whole-heartedly. I believe many if not most retailers understand the true magnitude of the investment they should and will have to make to compete effectively today in the modern grocery shopping era. Even if the retailers have the data, they don't have a meaningful investment in understanding the data and most importantly-- making an actionable insight from the data. Amazon is definitely on the cutting edge. I also find it interesting that shopper behavior doesn't rank higher given that the next frontier of competing effectively will not just be tracking 'results' in dollars/units from big data, but from understanding the 'how' and the 'why' and the 'who' of who is shopping their stores. Manufacturers are making this investment, but most retailers are not.

Add a Comment *