Sucessful Retailers Have To Invest In Market Intelligence

by Giuseppe Taibi on December 16, 2009

“I think that every retailer, if they want to be a customer-led retailer that’s working on really offering a better shopping experience for the customer, has to invest (in market intelligence capabilities). There are a lot of retailers, in the UK and around the world – and there’s a huge amount in the U.S. – that have the broad tools like a loyalty card, but they’re like Sainsbury’s was two or three years ago, scratching the surface, using customer data to do some clever targeted marketing and communication work, and trying to do some segmentations. But they really haven’t invested in the tools to help them make these decisions. A huge number of retailers only have to make a small investment to really harness the power of household data. And it reallyis small, because a lot of it can be paid for by the CPG manufacturers. The CPG’s want the information to make better decisions as well. The power of the data, as Sainsbury’s, Tesco, and Kroger have seen, is a major advantage. But not many people are doing it.”

[...] As RSR has been saying from our inception in ‘07, the retail ecosystem is driven not by what manufacturers and retailers want to sell, but by what consumers want to buy. And it’s not for want of trying that retailers have struggled to develop more demand-driven strategies. The most basic inhibitor is the sheer mountain of data that has to be turned into intelligence. “It takes a dunnhumby or an LMG to bring the true value out of that customer data,” says Gleason. “To put it into context, every day in the afternoon, we get through the previous day’s data from Sainsbury’s up to last midnight, and every day Sainsbury’s passes us 21 million rows of data. That’s everything from every transaction from every retail point whether it’s got a loyalty card attached to it or not.  We keep that data for over two years, so we’ve got over 20 billion rows of data that is then accessible for CPG’ers or retailers to access 24-by-7, to ask business questions like ‘what’s the right promotion to run’ or ‘what’s the right assortment’ or ‘what did people who bought this buy in the same basket’. Literally within two minutes, those 20+ billion rows are interrogated, and the actionable insight is drawn out of it. We invested $20 million to create this kind of tool. It’s not the retailer’s role to make the investments to create these kids of tools. We’re able to do this, and therefore companies like Sainsbury’s and CPG’s have a major advantage.”
Source: How to Win: Sainsbury Says ‘Make Shopping Easier’ by By Brian Kilcourse, Managing Partner, Retail Systems Research.
Home Page: dunnhumby
Title tag: dunnhumby – our know-how helps companies get to know and treat their customers better than anyone else
Description meta tag: “Our unique framework embeds customer insight into the organisation, enabling companies to make every decision a little better and a little faster.
Keywords meta tag: dunnhumby, essential customer, loyalty card, data insights, customer experience, customer engagement
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