Retailers Warm Up to Big-Data


NEW YORK CITY -- The National Retail Federation is having its annual four-day gathering here this week, and analytics seem to be the key to a persistently challenging consumer environment.

Of course, you don't actually hear the word "analytics" all that much at the NRF's 102nd Annual Convention and Expo -- a.k.a. Retail's BIG Show. Rather, you hear constant, indirect references to the insight and advantages that data creates through words like personalization, intimacy, and consumer engagement.

That message permeated Sunday's keynote sessions, during which speakers like Mindy Grossman, CEO of HSN, and Joseph Magnacca, president of daily living products and solutions at Walgreens, described data as essential parts of their operations.

"We don't just use data for numbers. We use it to connect with our customers and create intimacy with them," Grossman said. Magnacca added: "It's about using technology to our advantage."

Grossman and Magnacca were part of a panel discussion about creating meaningful innovation and consumer engagement that deliver results. The discussion was part of a keynote session titled "Coca-Cola Opens Happiness for Consumers and Retailers," which focused on creating relevant passion points with consumers and driving brand loyalty and product growth.

Big-data is giving retailers unprecedented information and insights about their consumers -- and everyone from officers of Fortune 500 companies to owners of single-location retail stores seem eager to take advantage of it. In fact, it's the reason many of the attendees said they took the time to attend.

In informal conversations at the show yesterday with more than a dozen people representing retailers of all sizes, the consensus was that data is the differentiater for successful stores.

The BIG Show, which runs through tomorrow at the Jacob Javits Convention Center, will draw an estimated 27,000 attendees from every US state and 70 countries. In addition to a host of big-name speakers, the show features more than five football fields of exhibit space filled with products from more than 500 exhibitors, including SAS, this site's sponsor.

Big crowds at NRF's 102nd Annual Convention and Expo.
Big crowds at NRF's 102nd Annual Convention and Expo.

The BIG Show is a big production. The first Sunday morning keynote was preceded by an elaborate performance by a troupe of broadway dancers. High-energy music blared during gaps in the program, and virtually every speaker dripped with enthusiasm.

But you have to look beyond the hype and the crowds to understand what this show means to the retail industry. In the wake of what by all accounts was yet another weak holiday shopping season, retailers seem to understand that creative and innovative solutions are essential to their survival.

Times have been tough for the retail sector for more than a few years -- and there is little hope for a rapid turnaround. During the BIG Show last year, for instance, former President Bill Clinton warned in a keynote address that it could take five to 10 years for the economy to recover.

The NRF has already warned that the pace of the US recovery is slowing, with the economy growing at an annual rate of 1.7 percent during the first half of 2012, down from the 2.2 percent annual average seen since the recession ended in 2009. While housing sales are up, concerns lingered in the second half of the year about employment, income growth, and the "fiscal cliff" of tax increases and federal spending cuts.

No wonder retailers want to take advantage of every solution they can to predict, analyze, and drive engagement with their customers. Attendees didn't come to this retail party to celebrate.

They're attending to try to understand the changing role of retail stores, as well as to stay a step ahead of what they acknowledge to be smarter, more demanding consumers. At the very least, they want to keep pace with changing consumer demands.

Companies like SAS believe big-data, coupled with high-performance analytics, can help retail companies tailor their offerings in a way that's beneficial to the company's bottom line as well as the consumer. What do you think?

Noreen Seebacher,

Noreen Seebacher, the Community Editor of Investor Uprising, has been a business journalist for more than 20 years. A New York City based writer and editor, she has worked for numerous print and online publications. Her work has appeared in The New York Times, the New York Post, New York’s Daily News, The Detroit News, and the Pittsburgh Press. She co-edited five newsletters for Real Estate Media’s GlobeSt.com and served as the site's technology editor.

She also championed the commercial real estate beat at The Journal News, a Gannett publication in suburban New York City, and co-founded a Website focused on personal finance. Through her own company, Stasa Media, Noreen has produced reports, whitepapers, and internal publications for a number of Fortune 500 clients. When she's not writing, editing, or Web surfing, she relaxes in an 1875 Victorian with her husband and their five kids, four formerly homeless cats, and a dog.

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Focus analytics on the disconnect
  • 2/4/2013 7:38:28 PM
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Noreen writes


Companies like SAS believe big-data, coupled with high-performance analytics, can help retail companies tailor their offerings in a way that's beneficial to the company's bottom line as well as the consumer. What do you think?


 

Well, it seems to me one of the emerging problems that analytics might focus on in the retail industry is the disconnect between online vs. in-store marketing and consumer behavior.  Stores need to be ready to price-match their online competition.  They need to be able to eliminate the Shoo-bee (SHBE, shop here buy elsewhere) syndrome, where "elsewhere" very often means Amazon or another online site.  Right now, even big retailers seem partially stuck in the last century.

 

Re: convention
  • 1/28/2013 8:55:17 AM
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Retail will be the big one for analytics. New trade magazines, new firms opening to service their data, and companies to service the servicers, and on and on.

Of course Target was one of the first to explore "relationships" with customers and got into some hot water over their promotions to discovered pregnant customers.

They managed to eventually get over that hurdle, modifying marketing so it wasn't so obvious to customers just how much they knew of their lives.

Big data will surely make more profits down the road for the big guys and hopefully to the smaller outfits too.

Re: convention
  • 1/16/2013 10:29:32 PM
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@Noreen Good point. Somebody will always need new shoes.

Re: Secret Analytics
  • 1/16/2013 5:31:20 PM
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@ecox, thanks for your insider's perspective -- makes a lot of sense. I'm fascinated by the cooperation you describe among retailer analysts. I would have thought competitive considerations would make that sort of interaction tricky.

Secret Analytics
  • 1/16/2013 1:47:22 PM
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Beth,

Retailers are generaly a secretive bunch. They dont advertise or discuss what they are doing on the analytics front.

Most trade shows, like The Big Show bring in the merchandise Buyers and Planners. Not the analytics teams that specialise in predictive modeling.

So it doesnt surpise me that few people discussed analytics. Most of the discussions I had at these were around production quantities, over seas availability, who else have you talked to about buying this/that.

Now if you are at the SAS Analytics conference, you will not find merchandise buyers, but you will find analyst from every business. And you wont hear anyone speak about the hottest color this year.

You may find analyst from various competiting companies getting together to discuss.. what else... Analytics, types of tests, types of models etc. But these are generaly off the main path, in a side room way in the back. Away from prying eys and ears. This is the underground network. While working at Kmart, my team often shared ideas and problems with Target, Wal-mart, PC Pennies etc. And they also shared the same with us. This communication path worked very well thank you.

Retailers tend to not present analytics or fact based results to other retailers. 

Obviously there are some exceptions but not too many.

Re: convention
  • 1/16/2013 8:15:15 AM
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@SethBreedlove, I don't have an answer to your question regarding Walmart's buy American push, but I understand that 60 Minutes ran an interesting piece this weekend about US companies bringing manufacturing back to the states (from places like China) thanks to the advancing state of robotics -- ie, they can use robots to do the jobs more cheaply than low-cost human labor outside the country. And interesting trend, but one that doesn't do a thing for the American workforce! Here's a 60 Minutes interview (text) on the subject: Are Robots Hurting Job Growth?

Re: convention
  • 1/15/2013 8:36:15 PM
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Some can be like going to Las Vegas. 

Slightly off subject, but I wonder what kind of analytics goes into Walmart and their newest "Buy American" push.  Wal-Mart Plans $50B 'Buy American' Push »

Four ways Walmart uses analytics - Business Analytics

Re: convention
  • 1/15/2013 8:43:55 AM
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Conferences do definitely take a certain amount of stamina! 

Re: convention
  • 1/15/2013 8:11:10 AM
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Conferences sound exciting until you get there. Then they are just exhausting!

Re: convention
  • 1/15/2013 1:02:51 AM
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Well the BIG Show is technically about retail, not analytics and as long as we have a need for shoes, then there will be retail activity!

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