Do more with data

Retailers need to understand the type of data they have.

“Retailers have to harness the data that are already recorded and collected within the retail world,” said Dr Farouk Abdullah, chief data scientist and country head (Malaysia and Singapore), Natural Intelligence Solutions. Speaking to Retail Asia on the sidelines of the recent Experiential Marketing Summit in Singapore, he explained that retailers today are facing increasing competition from online players, along with the perception of service from customers.

Specifically, retailers need to understand the type of data they have. He said: “Retailers usually have a large amount of data that they don’t know that they are collecting. Anything from transactional data, the stock keeping unit (SKUs), to inventory, right down to who are coming into their shops.”

He shared an example of a grocery retailer that leveraged data to discover what and when customers are buying, along with the combination of items.  The data allowed the team to understand product placement and at which points of the day should they sell certain types and amount of items, and which products can be offered together at a discounted rate.

“Even from those three or four data points, we were able to identify where they should place the products that customers buy regularly, and at which time of day the retailer should stock up on products and services. It then lends itself to insights such as what does your workforce management look like and how many staff do you need at any one point?” he elaborated.

The data also helped with inventory control to determine when deliveries need to happen and as the retailer had several branches, cross-shop inventory also proved to be useful. Farouk revealed that this exercise has increased the revenue and the gross margin of the retailer, primarily because they do not have to carry as much stock as they thought they had to.

This example is just a tip of the iceberg of how retailers can turn data into actionable insights as the future of data analytics has more to offer. For example, the current buzzword in the industry is facial recognition point-of-sale (POS) systems, according to Farouk. Luxury retailers use it to identify their repeat customers and allow retail assistants to have easy access to their spending records at the store or brand. For smaller retailers, it helps them to know what promotions and products to surface to the customers based on their previous purchases.

He added that retailers are also moving towards doing away with checkouts (as seen with Amazon's checkout-free grocery store) and implementing portable POS systems where customers can approach a retail employee to makes payment on the spot without needing large checkout counters in the store.

Known as an industry thought leader and advisor to CEOs, Dr Farouk Abdullah has over 15 years of first-hand experience of establishing analytics teams and delivering trusted insights in large Financial Times Stock Exchange (FTSE) 500 companies in the UK.

By Muneerah Bee