Retail Business Intelligence: a Work in Progress
Retail Business Intelligence: A Work in Progress Benchmark Report 2012
Nikki Baird & Steve Rowen, Managing Partners October 2012
Sponsored by:
Executive Summary
Rapid shifts in consumer behavior and proliferation of new channels are forcing retailers to cope with new data sources, new ways of looking at analytics and new analytics capabilities, like high performance databases and visualization techniques. Add in new form factors, like tablets and smart phones, and a discipline that is theoretically staid and well-established is suddenly upended. Retailer survey respondents report that they are feeling the disruption. Although they have not made much progress in establishing and executing against a business intelligence strategy, they report that their priorities and opportunities have shifted significantly.
Key Findings
• 47% of mega-retailers (over $5B in sales) have had a BI strategy in place for longer than 2 years, vs. 22% of those with revenue under $250 million, and 36% of those with revenues $250-$999 million. 58% of Winners (those who outperform their peers in retail sales) say all channels can take equal benefit from BI investments vs. 48% of peers. Conversely, 32% of nonwinning retailers still say the store should be the primary beneficiary vs. only 23% of Winners. This kind of shift is typical of Winners, who have a tendency to identify the need to change direction sooner, and make that change faster. 43% of retailers under $250 million in revenue report that they dump data into Excel as their primary method for BI insights. Only 13% of mega-retailers report this, and an even smaller 5% of retailers bringing in between $1-5 billion in revenue. The top two opportunities reported by our overall survey respondents are merchandising-oriented: what-if capabilities for matching demand with assortment, price, and promotions, and more intelligent space and product allocations, which on the surface seem a lot more product-oriented than
Nikki Baird & Steve Rowen, Managing Partners October 2012
Sponsored by:
Executive Summary
Rapid shifts in consumer behavior and proliferation of new channels are forcing retailers to cope with new data sources, new ways of looking at analytics and new analytics capabilities, like high performance databases and visualization techniques. Add in new form factors, like tablets and smart phones, and a discipline that is theoretically staid and well-established is suddenly upended. Retailer survey respondents report that they are feeling the disruption. Although they have not made much progress in establishing and executing against a business intelligence strategy, they report that their priorities and opportunities have shifted significantly.
Key Findings
• 47% of mega-retailers (over $5B in sales) have had a BI strategy in place for longer than 2 years, vs. 22% of those with revenue under $250 million, and 36% of those with revenues $250-$999 million. 58% of Winners (those who outperform their peers in retail sales) say all channels can take equal benefit from BI investments vs. 48% of peers. Conversely, 32% of nonwinning retailers still say the store should be the primary beneficiary vs. only 23% of Winners. This kind of shift is typical of Winners, who have a tendency to identify the need to change direction sooner, and make that change faster. 43% of retailers under $250 million in revenue report that they dump data into Excel as their primary method for BI insights. Only 13% of mega-retailers report this, and an even smaller 5% of retailers bringing in between $1-5 billion in revenue. The top two opportunities reported by our overall survey respondents are merchandising-oriented: what-if capabilities for matching demand with assortment, price, and promotions, and more intelligent space and product allocations, which on the surface seem a lot more product-oriented than