Why Brick-And-Mortar Retailers Struggle To Create Actions From Data Insights

Jan 28, 2019

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Spurred on by technological innovations across almost every industry, many brick-and-mortar retailers are transitioning into insights-driven companies.

Before, we only had access to customer feedback and what little other data we could get our hands on (point of sale transaction counts, for example). Now, the mass of data we can collect from our websites, social media, and in-store sensor systems has given us the opportunity to base our business decisions on hard facts—which leads to drastically improved customer experiences and, ultimately, better in-store results.

Besides having access to data, creating meaningful actions based on data insights is the most important step in the process of becoming an insights-driven business. Unfortunately, a lot of businesses are struggling with this part of the process.

While nearly three-quarters of retail professionals consider shopper data insights essential or very important to their performance, a mere 16% feel like their brands are experts at using them. According to the National Retail Federation, 42% of retail CIOs say turning heaps of data into usable business analytics is their greatest concern .

It seems that while you may have more than enough data to get started (though later we’ll discuss whether this is the right data), sometimes it’s the human part of the process that is slowing you down.

What are some of the common reasons retailers are struggling to create actions from data insights? Read on and find out.

Your Company Culture Isn’t Ready

If you’re serious about becoming insights-driven, you need to have an all-inclusive strategy that revolves around data, analysis, and results.

Every single employee, from executives to salespeople on the floor, should be aware that company changes and success will be driven by data and data analytics. It shouldn’t be a shock for managers and floor-level employees to hear that their performance will now be assessed based mostly on numbers, either. Emphasize that while assessments will be data-centric, they will be fair, reasonable, and, most of all, based on improving past results.

Testing and learning should be the foundation of your strategy. In fact, emphasizing the testing and learning process should not only assuage any fears, but actually excite your employees. Testing and learning is all about recognizing a data point that you’d like to improve, trying a new tactic to see if that works, and measuring results. And if at first you don’t succeed, try, try, try again.

Transparency should also be vital to your strategy. Number-based assessments leave nowhere to hide, which may make some employees feel nervous about any negative results. In order to ensure everyone is on board, emphasize that bad results are opportunities for improvement. Knowing what tactics don’t work gives employees the chance to try something new.

Data should not scare your employees; it should free them up to think critically about improving your business.

You Don’t Have The Right Data

You probably have access to a massive amount of data. Here’s the problem with a lot of data you and other physical retailers are collecting: it’s worthless.

Source: RetailWire, "How Shopper Insights are Fueling Retail Progress," March 2014

Take, for instance, data from rewards. Special programs and sweepstakes require a shopper fill out a form with valuable information. Then, their POS data and the data entered on the form is yours to monitor. However, there’s a good chance this shopper’s sister, daughter, and cousin are also using the same rewards program card.

Anything that is filled out by shoppers personally is probably, as industry guru Doug Stephens likes to say, “garbage...big garbage.” Unfortunately, they don’t have a strong incentive to give you accurate personal data.

There’s a problem with the website data you’re getting, too. If you’re relying on data you get from your chain’s general website, you may as well press delete on all those spreadsheets.

Online shoppers can give you a vague idea of what your in-store audience is like, but if your brand is located in multiple countries, or even just multiple counties, you have no specific data from the locals who visit your store. Even if you have a local store website, remember that these people are shopping online—not in your store. That’s why actions based on online data insights aren’t getting the responses you expect.

To create actions that will really work in your store, you need access to accurate, store-specific data.

For physical stores, there’s one reliable way to do that, and that’s with retail analytics systems. By collecting anonymous data with low-profile store sensors then running complex algorithms, these systems produce reliable, relevant insights into all kinds of store functions. Traffic count, traffic flow, new customer rate, returning customer rate, and visit frequency are only some of many data points that can give you a good look into the exact status of your store.

Even though in-store visitor behavior data is the most relevant data a physical store could use, only 42% of retailers say they collect it. If you’re one of the 58% of retailers who is out of the loop, you’ll find that once you have access to data insights directly related to your brick-and-mortar store, you can begin to create actions to help it succeed.

You Aren’t Strategizing Past Clear Data Points

If you do have store-specific data, you might not be looking past its face value.

Some data insights have obvious follow-ups. If 6,200 people came into your department store last week when you had Halloween decorations in the window and only 4,500 came in this week after you took them down, you know you had better get some skeletons in your window before Halloween passes by. If return customer numbers increased after you held a networking event, you know that more events are in order.

Some data insights have less obvious follow-ups. For example, if most of your customers are returning customers who spend ten minutes in your store and head straight to a certain perfume section, what on earth can you do with that? With a little strategic thinking, you may decide to change your store layout into a loop layout, so returning customers are exposed to a variety of different products before they get to their favorites.

What if your traffic drastically increases after a surprise sale? Consider switching your staffing schedules right after your next surprise sale to cover your bases and provide the best customer service experience possible.


Need help strategizing about creating actions around data insights, or want to start gathering the right data? We can help.

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