Have you used a digital product or service while shopping in the past year? The answer is almost certainly “yes” and each time you are online, your actions generate data – from research, online ordering or in-store pickup, coupons, mobile payments, voice commands and more. The question is, how do retailers make the best use of this data to stay ahead of the competition?
From the massive amounts of data that are being generated from your digital interactions, retailers have an opportunity to collect this data, along with other information, to effectively identify problems, opportunities and solutions. Transforming this data into key business metrics that monitor sales, profit, inventory and people are key for the decision-maker to take the next best action. This information is commonly spread across multiple systems and cannot be quickly transformed, resulting in siloed reporting and sub-optimal decision making.
Attend September 10, 2019, webinar with Matt Simonsen and Doug Tiffan on “Four areas retailers must analyze to stay ahead of the competition.” Register now.
In an upcoming webinar, Infor Director of Retail Strategy Matt Simonsen and Infor Chief Merchant Doug Tiffan will drill down into six different business units, across a retail organization, to explain how these four areas of sales, profit, inventory and people are analyzed using modern business intelligence (BI) and analytics to make better decisions to improve sales, profitability and customer service. I spoke with Matt and Doug to provide us with a preview of the webinar:
1. In speaking with retail organizations, what are the biggest challenges they are facing when it comes to using data and analytics to identify problems, opportunities and solutions?
Retailers are experimenting with innovation to connect with buyers to generate more revenue. These innovations could be ordering through Alexa and Instagram, delivering to lockers or GPS location, or one-day shipping. To understand how innovation is performing, everyone involved – sales, marketing, supply chain and labor, etc. – must have access to the same data to work toward a common goal. But the age-old problems still exist. Insights cannot be gathered fast enough, and no one is looking at the same numbers. The root of the problem is that data is spread across different systems – data warehouses, e-commerce, merchandising, planning and more. As a result, departments pull their own data independently and create their own version of performance.
The CEO must then have someone piece the insights together, which takes time and results in missed opportunities and hidden costs because adjustments to the innovation rollout and execution cannot be made fast enough. A timely and accurate picture of how these innovations are performing is needed to adjust strategy and improve customer satisfaction, as needed. For example, if ordering through Alexa improved sales by 10% but increased shipping costs by 30%, due to a one-day shipping offer, then adjustments need to be made quickly to meet profitability goals.
2. Why is it important for business units across retail to have the same view of sales, costs, people and inventory? What is preventing users from doing this today?
It is important to understand that decisions made in one business unit impact other business units and the entire organization. Sales, costs, inventory and people affect profitability. For everyone to work toward the same profitability goal, there needs to be an agreed-upon definition of Key Performance Indicators (KPIs). For example, is inventory based on “total units” or “sellable units”? Are sales “gross sales” or “net sales”? If marketing runs a campaign based on “gross sales” and “total units,” instead of “net sales” and “sellable units,” there may be downstream added costs in the supply chain to fulfill out-of-stock orders in a timely manner, resulting in lower profits. Therefore, every user must have access to a common view of agreed-upon KPIs, where they can easily coordinate and collaborate on a strategy for profitability.
3. In your upcoming webinar Sept. 10, you drill down into six key business units and how a common view of sales, profit, inventory and people are critical for improving the business. Can you please provide us with one example?
If marketing and supply chain are not in synch, you can end up with a successful marketing campaign that drives incremental sales, but negatively impacts the supply chain with out-of-stock inventory and insufficient labor to meet demand and keep customers happy. Higher supplier pricing, overtime wages, dissatisfied warehouse workers and expedited customer shipping all negatively impact the supply chain department but also lower overall profitability for the organization, despite the increase in sales.
4. Why is the use of modern BI and analytics critical in retail today?
Modern analytics facilitates more real-time, agile decision making, which is needed as retailers scramble to innovate and create new strategies to compete. In today’s retail environment, consumers have so much choice and access to competitive products. As a result, retailers must present customers with better offers. For example, if competitors are running a sale, free shipping can be offered as an extra incentive, if logistics is reporting and forecasting underutilization.
5. What are customers saying that is unique about Birst for cloud BI and modern analytics?
What customers find most valuable are the patented technologies that automate the creation of an agile business layer that remains consistent and accurate across all departments. This standard definition of business terms and KPIs is processed in a fraction of the time that it takes, compared to legacy BI tools, enabling businesses to get started sooner and add additional data quicker to all reports and users. This agility facilitates innovation across departments, due to self-service capabilities with governed IT control. All business units can work together to maintain the common business layer enabled through Birst Networked BI. Our customer and well-known fashion retailer Diane Von Furstenberg (DVF) talks more about how Birst has provided the agility needed to increase eCommerce sales. Watch the on-demand webinar with DVF.
Mona Patel works in Birst’s Product Strategy team. With more than 20 years of experience building analytic solutions at The Department of Water and Power, Air Touch Communications, Oracle, MicroStrategy, EMC and IBM, Mona is now growing her career at Birst. Mona received her Bachelor of Science degree in Electrical Engineering from UCLA.