The Year of Data Action Is Well Underway

3/19/2014
Just as the industry heralded every year since 2010 as the "Year of Mobile," 2012 and 2013 were both lauded as the "Year of Big Data." With Big Data at or near it’s full hype phase, executives still found themselves swimming in a sea of data that every industry pundit swore held the keys to their prosperity in this new age.  

Overwhelmed by disparate reports and unable to get a clear view across their businesses, the "Year of Big Data" proved to have as many challenges for the apparel industry as benefits.

From marketing campaign data to CRM data, site analytics to purchases and returns, apparel companies must obtain, sync-up and analyze a multitude of data points in order to lead to profitable decision making in the year ahead.  Retailers poised to succeed have already shifted their mindset to 2014 being the year they put Big Data into action.

At this point, well-run companies have spent a great deal of time looking at their data. They’ve determined a few or, in the extreme case, hundreds of KPIs and have begun the process of tying data sets together. Leading companies are already beginning to shift into transforming their Big Data into actions that impact their business decisions every day, week and month. A few key areas of evolution will spark this overarching trend of turning Big Data into action for apparel retailers.

Goodbye "Big Data," hello "algorithms of action"
The term "Big Data" is joining the ranks of "personalization" and "omnichannel" as overused industry terms. However, like having a solid plan to connect with customers whenever and wherever they choose to shop, having the organizational structure and focus on data action will set retailers up for success in the year ahead. This means developing an aptitude for connecting data via algorithms that amplify a retailer’s ability to make smarter decisions.

There are a few challenges that apparel retailers will have to overcome in order to transition to putting data into action. According to Harvard Business Review, 85 percent of organizations reported that they have Big Data initiatives underway, yet only 21 percent of respondents ranked their analytic capabilities as adequate. Add to this the fact that retail hiring continues to grow, as does the shortage of analysts and data scientists available to hire. A survey by SAP revealed that 84 percent of retailers are worried that it will be challenging to find employees with the appropriate technology and data skillsets.

Forward-thinking retailers will focus on hiring "super analysts," those who bring to the table overarching business understanding and a focus on cross-organizational and cross-channel decision making. They will have C-level oversight or at least sponsorship of data-driven decision making, with employees at every level focused on using data support their decisions in achieving unique and shared goals.

Apparel data in the cloud
As Big Data has become the term du jour, so, too, has the understanding of the value of cloud-based solutions to make sense of the data.

As retailers accelerate their goals around data understanding, it is increasingly making more sense for them to chip away at the complexity and costliness of hardware management and look to cloud-based solutions. As Forrester analyst James Staten recently observed, "If you're resisting the cloud because of security concerns, you're running out of excuses." The modern company understands that SaaS has become the norm for buying new applications and managing complex data sets like those of apparel retailers, and for good reason as they improve everything from productivity to team collaboration while reducing upfront costs.

CTO and CIO, meet CMO
There is a great deal of industry discussion around the need for the data-driven CMO in the years ahead. The other side of this discussion, however, is that the CMO will likely be charting the course for a retailer’s data solutions more than the CTO or CIO in the year ahead.

As marketers look to find smarter ways to reach new consumers, convert faster, personalize more specifically and create repeat purchases, they are relying more heavily on cross-organizational data to determine the day-to-day actions that need to be taken in the marketing department. From the ability to immediately ascertain that an email campaign is leading to out-of-stock products to curating the ideal complementary products to show a specific customer, marketers are relying more heavily than ever on bigger datasets across more organizational silos and will therefore join the CTO and CMO in identifying solutions that rapidly integrate Big Data so the organization can make smarter decisions faster each and every day.

With the amount of data being created and replicated in the U.S. (6.6 trillion gigabytes) projected to grow to more than the amount of data currently created in the entire world (4.2 trillion gigabytes) by 2020, Big Data growth is a trend that is here to stay. As apparel organizations become better aligned around data analysis, understanding and action, they will ensure that their data is not just Big, but a powerful action driver of profit in 2014 and beyond.


John Squire is president of eCommera North America, a provider of analytics-driven commerce software.
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