Retailers are facing a paradox: Shopper expectations are soaring just as their attention spans are shrinking. According to a Microsoft study, the average human attention span has declined from 12 seconds in 2002 to eight seconds today, literally that of a goldfish.
This ups the stakes for retailers and brands to deliver the right product at the right time with surgical precision, efficiency and speed to satisfy the increasing demands of today’s distracted, multichannel shopper.
And while retail has always been both an art and a science, decisions informed by gut-instinct alone just don’t cut it in a digitally transformed landscape.
Merchants and brands are turning to data analytics amid an increasingly complex retail ecosystem now flooded with streams of digital buying and selling ducts.
In turn, stores are retooling their inventory-management systems, the unglamorous-yet-critical nuts and bolts of retailing, moving to platforms empowered by robust, data-analytics tools.
But that’s contingent on creating visibility throughout the supply chain.
Overstocks and out-of-stocks cost retailers $1.1 trillion globally in lost revenue, in part because retailers are not sharing data across the enterprise, and because systems can’t talk to each other.
That real-time, sharable flow of data insights throughout the many moving parts of a supply chain is one example of retailers transitioning from “information siloes to knowledge networks,” a shift noted by Scott Lachut, president of PSFK during the consulting firm’s ‘The Future of Retail 2017” presentation.
And merchants that migrate to data-driven operations models are poised to reap the rewards. IDC reports that by 2017, retail companies that harness data insights can potentially realize an additional $94 billion in collective revenues over companies that don’t.
Quick Study: MARS DRINKS
One example of data analytics working its creative disruption is in the vending machine segment, which pulls in $20.7 billion in annual U.S. sales, and boasts a network of 5.1 million machines.
Microsoft partnered with MARS on a proof-of concept with the candy company’s DRINKS KLIX vending machines to test its Internet of Things Azure analytics capabilities.
The IoT technology solution weaves real-time business intelligence throughout the value chain, in this case, vending machines, distributors, the service experts who restock the machines, and consumers.
Microsoft’s cloud-based analytics platform enabled MARS to identify the optimum times to stock and service its drink machines, while also providing data insights on consumers’ beverage consumption habits and product preferences.
That flow of actionable data was funneled to the restocking staff, enabling them to identify areas where improvements could be made, which brought a new nimbleness and speed to course correcting inventory issues.
As a result, inventory accuracy rose on real-time insight from machine performance, stock levels and servicing, while granting the restocking staff unprecedented workflow efficiencies, including route optimization. You can learn more here.
In my next post, I’ll talk about additional steps retailers and CPG brands are taking to transform their businesses from within. In the meantime, you can also access our new Microsoft resource on transforming retail for the digital age.
In this paper, we discuss the opportunities for the retail industry to grow, adapt and evolve to address the changing needs of customers and capture new business potential, and how Microsoft can help accelerate digital transformation.
LinkedIn: Tracy Issel