“We are surrounded by data, but starved for insights.” ~ Jay Baer
The retail industry is always changing. In an era of reduced consumer spending power, due to rising inflation and stressed incomes, having the right products in stock, at the correct price and in the correct retail location, gives retail establishments a competitive edge as they fight for customers’ wallets. Manufacturers and their brands need to know what their customers want and what the competition is offering in order to determine which items and pricing points are appropriate.
Retail insights, for retailers, can be obtained by learning about the consumer, where they buy, what they buy, how frequently they buy, and why they buy from a particular retail outlet. Insights are also to be found in data on stock movement, stock returns, stock positioning and till returns. For retailers who have a loyalty program, they sit on a goldmine of insights, that can be easily unlocked using analytics.
How does a retailer look for insights to grow and drive retail success and excellence?
- Understand ALL your customers. Customers are complex. You have your loyal customers, one-off customers, lapsed customers and reject customers. Each of them has a story, and the best way to begin understanding them is talking to them. Conduct a customer satisfaction study. What makes you happy when you shop with us? Observe your customers when they shop, when they move between the aisle, when they pay, when they leave you shop. Did they come in smiling? Did they leave smiling? You have everything to gain when you talk, observe and understand your customers.
- Work with the retail data you have. Retailers move stock on a daily basis. That stock leaves a data footprint that needs to be understood. Using simile MS Excel, understand the movement of ALL stock on a daily basis, weekly basis, monthly basis and annual basis. There are insight that reveal themselves in the time. Do the same for stocks returned or stock expired. Do the same for damaged stock or customer returns. What stock moves fastest? On which day does stock move fastest? When do I have the most damaged stock? All this will help you with people, inventory and supply chain optimization
- Mine the customer data you have. Here lies the goldmine of insights for those with customer data. Collected via loyalty card or payment details, this allows you to understand spending in a mind blowing way. You can conduct a segmentation study of your customers based on this data, retail analytics you can identify purchase patterns based on data on shopping habits, you can correlate product purchase with different customer segments and offer promotions that are segment specific. You basically have a front row seat into their wallet / purse. Leverage on that, while abiding by the data protection and privacy guidelines.
- Innovate within your store. Selling is both an art and a science. Where to place the bread and where to place the soap have been studied and justified by both art and science. Your nose will follow the smell of fresh bread and confirm it will alway remember soap if you hear a tap running. Do narrow shelves increase or decrease your sales? Does music keep your customers longer because they feel at ease? Does increased lighting in a kiosk make decision making easier? There are proven methods and there are new methods you can develop by innovating and asking your customers.
On retail growth, “Creativity is thinking up new things. Innovation is doing new things.“ Theodore Levitt (1925 – 2006), Economist
