As the volume of available data continues to explode, there is no doubt it has the power to help retailers to drive profitable revenue growth and create deeper relationships with customers. But, many retailers feel their efforts are hindered by the explosion of data. At a time of significant retail transformation, retailers know that they need to make intelligent decisions, faster and at scale, they know they have the data but they don’t know what to do with it.
Understanding retail transformation
Generational shifts are something that we keep a close eye on in retail. Studying the up-and-coming spenders and the direction they’re headed in is a key first step in meeting the needs of target grocery customers. The way that Millennial and Gen Z shoppers think, browse and purchase, brings unique pressures to grocery retailers. They crave convenient, healthy and sustainably sourced products that fit with their own belief and value systems. This new generation of shopper comes from, and creates, a very different household where there is a dual income and a significant time constraint, which means that there are several shoppers in each household.
Not so long ago, retailers found it easy to identify and target a single customer, but that’s no longer the case. There are now more shoppers that retailers need to understand and these are shoppers with more complex and specific requirements who will actively seek the retailers who provide them with the best products to match their lifestyle choices. Undoubtedly, convenience is the name of the game, evident in the fact that on any given day before 4:00 p.m., up to 80% of Americans don’t know what they’re having for dinner that night, a habit that has been enabled by the availability of prepared meals, meal kits and grab-and-go options – all which have exploded in popularity.
Understanding the transformation of data
When we see this level of transformation in retail, it becomes very clear that the data processing habits of old are simply not enough now. A high volume of raw customer data is needed to help retailers to understand and capitalize on the industry transformation. But the data will only act as an enabler if it’s turned into digestible and actionable insights to help retailers to deliver value to customers and drive loyalty as a result.
It’s interesting to note that while data presents a massive opportunity, it simultaneously threatens operational and technological profitability. For example, it’s relatively easy to identify customer segments responding well to a given promotion by sorting through customer data; it is far harder to know why another is not, and even more challenging to know how to profitably adjust. What’s more, retailers must leverage that understanding to actually improve promotions across the business that drive more store visits, larger basket sizes and higher sales. This imbalance between opportunities and outcomes is clouded even more by a disrupted grocery retail landscape.
Aligning the transformations
While retailers have little control over changing consumer behaviors and emerging lifestyle changes, they can control the transformation of data in their own environment. Making the decision to use raw customer data to understand industry transformation is the first step, turning that data into actionable insights is where retailers can begin to gain competitive advantage.
Or, if you’re ready to transform your data to uncover insights and recommend intelligent actions, meet CINDE: