Retailers are also carrying far more SKUs than ever before, along with a wide variety of colors and sizes, and if they don't make the right moves to optimize their local assortments — and make them quickly — they can see profit margins vanish rapidly.
To overcome these challenges, retailers and brands alike have to know what's hot, what's not, what's moving and where, what sizes to stock, and much more.
But merchants and store operators just don't have time to sift through mountains of business intelligence (BI) reports, given the speed at which fashion moves today. And, even if they had time, those cumbersome reports are usually limited to old news about problems that have already occurred, such as stockouts or overstocks. It's more important to know about problems and opportunities in real time — such as imminent stockouts or hot-selling styles — while decisions can still be made to maximize inventory productivity and sales performance.
Turbocharging BI investments
So how are some retailers able to orchestrate decisions at the speed of fashion? They are turbocharging BI investments by adding analytics accelerators. These accelerators enable instant decision making by taking traditional BI systems to the next level in four key aspects: they are more automated, more actionable and more practical, as well as more simplified with highly mobile delivery.
More automated analytics accelerate the speed to decision by automatically analyzing a chain's performance and tagging positive and negative exceptions at the item and store levels — the levels where the exceptions occur. By removing false positives and calculating the impact of these trends, these analytics help merchants quickly focus on the high-impact opportunities and take the appropriate actions.
Decisions can also be made faster because these more actionable analytics suggest specific actions, or plays. Executives favor this more sophisticated approach that cultivates best practices, or a playbook, across the merchandising team. Analytics that identify the appropriate actions help ensure the right plays are run at the right time to best respond to trends.
Another key to making rapid decisions involves more practical analytics. Instead of attempting to make one size fit all, the acceptance and usage of analytics is much stronger with a role-based based approach that is designed to meet the individual needs of buyers, planners, allocators and store operators.
Finally, a more simplified delivery via mobile devices — such as tablets or smartphones — also accelerates the usage of analytics. Merchandisers are no longer chained to their desks, poring over reports or staring at a dashboard. Instead they can quickly drill down and take action whether in Monday morning meetings or out on a store visit.
As RSR managing partner Paula Rosenblum recently said, "consumer-grade usability has become the order of the day. No one gets a user manual with consumer apps. BI should be equally as simple."
What's the end result of turbocharging a traditional BI solution?
- Buyers know almost immediately which orders to cancel and which to accelerate.
- Allocators have a concise listing of which stores are in the greatest need of specific merchandise today.
- Executives can ensure the best high-level product mix and better manage key departments while they have time to impact sales performance.
Jeff Buck is CEO of QuantiSense, a provider of business intelligence and analytics solutions for the retail industry.