Drowning in Data: Challenges Facing the Modern Day Retailer
Working in the world of retail, it’s challenging to keep up with constantly changing shopping habits, effectively managing customer data, and choosing the right engagement platforms. As an IT executive who tries to stay on top of these ever-evolving changes, I continually ask myself if my clients’ goals and objectives are aligned with their customers’ expectations.
Reflecting on industry trends in 2014, and looking ahead through 2015, it’s easy to see that retailers are in the midst of a very exciting and innovative time. However, it should also be a time to assess current information management architectures and governance. In order to successfully address the retail challenges in 2015, and improve the customer experience, it’s essential that your data is positioned to leverage historical measures, integrate new measures from various sources, and provide a high level of security.
In my view, some of the key trending retail challenges for 2015 include:
- Using analytics to better understand, retain and increase customers
- Tailoring marketing mobile, and social media experiences for two influential, but diverse, generations: the baby boomers and the millennials
- Having a solid data management strategy in place to supplement a legacy data repository with newer data sources, such as: online, mobile or social media
- Incorporating mobile and social media as additional shopping platforms for reaching a wider customer base
- Paying close attention to data security, especially, customers’ private information
Is your existing data repository or data warehouse capable of addressing these challenges? Is there alignment between your data management group and your business objectives? How confident are you right now to make a data-enabled decision to change a customer-facing business process based on insights from your current business intelligence or Big Data environment? If that makes you uncomfortable, then here are some things you should consider.
Traditional business intelligence (BI) environments often provide transactional measures that can be sliced by time, product and location. Inventory, orders and vendor information may also be integrated to provide additional views into day-to-day activity over time. This environment is unique to other environments in your company because it’s constantly evolving, and becomes more in demand as users better understand the data. In this sense, your BI environment is a living and active ecosystem of data, integrations and reporting. For most companies, this will be the environment you leverage to mature your overall data management strategy. Therefore, it's important to understand where your current capabilities lie before going beyond the row and column views of your business.
Fundamentals of Information Management
At the root of being able to address these and other challenges, it’s important to realize that a company’s success in leveraging data stems from a solid foundation of information management principles and fundamentals. In my view, here are some key concepts to managing your data:
- Data Governance – This is the first step in ensuring that newly created data is properly formatted, consistent and accurate
- Data Quality – It’s essential to ensure that the transfer of data between systems remains intact and aligned with each other
- Data Availability – Information should always be readily accessible to empower users to make decisions
- Data Security – Customers value their privacy, so it’s important that confidential information be stored securely and within compliancy standards
From a retail point of view, the capabilities that Big Data offers can play a huge role using advanced analytics to discover valuable insights that allow companies to pull in measures not traditionally found in the BI environment. By supplementing your existing internal data with the constant flow of data from a variety of alternative data sources, you can start to create a more complete customer profile and begin to tailor the shopping experience to individual customers. However, before you make the decision to dive into the data lake, have a well-defined plan and be aligned with your business objectives.