Using BI for retail so you can estimate future inventory needs, understand customer behavior, and build forecasts is the life’s blood of any retailer. As a retailer, you’re probably well aware that you operate in what experts consider one of the most data-driven industries in the world. But even in retail, the data times, they are a-changin’.
Making data-driven decisions in today’s retail climate means not relying solely on what you can learn from the past. Consumers are more fickle than ever and less likely to reward retailers with long-term loyalty, so being able to accurately anticipate what they will do next, then quickly react is the name of the shopping game today. For that, you need real-time input from all data sources in your organization — from the traditional to the new, such as Internet of Things (IoT) sensors and other devices, static images, and even cameras monitoring stock in warehouses.
The self-service BI tools that have entered the marketplace in the last decade might have offered a great deal of promise, but how much have they really delivered? It’s true that their beautiful, compelling dashboards give everyone from merchandisers to buyers to retail business owners a snapshot of “what’s happening” on the sales floor and online. But that isn’t going to be enough if you want to please that fickle customer, open a new store in the perfect location, or make sure you don’t order the wrong product because of out-of-date information.
The prettiest visualization ever is still not going to answer the all-important question: “Why is it happening?”
Using BI for retail to understand why customers buy
To win the hearts and minds of customers, you need to get beyond quick vignettes to the deeper insights that demonstrate the effects of a regional marketing campaign, show customer buying trends at certain times of the year, or alert you to low inventory levels. Basic BI tools cannot help you ensure that you respond to customer whims and events as and when they occur.
Also, you need to consider the fact that some of the people using these tools might not have the right skills. And even when they do, they might be using old-fashioned or misguided approaches. Examples include using correlations to prove causation or KPIs to explain results. Then there is the most persistent “danger” of all: those who look at results and data through the lens of their own bias, possibly blinding them to something game-changing. This raises the question: are your management teams and executives hearing what they want to hear or what they need to hear?
A new kind of analytics for retail
So, how can your retail organization make the unbiased decisions that increase revenues and profits, reduce costs, produce optimized sales forecasts, and allow you to offer trendsetting products? It takes a new breed of analytics, one that infuses traditional BI for retail with “smarts.” This term might seem lighthearted, but underneath it is something that is anything but light: augmented intelligence. Augmented intelligence delivers data conversations that can learn and adapt to individual needs and, more importantly, give users precise answers based on contextual recommendations. Also, automated pattern detection helps users gain access to better answers by reducing human bias.
Aberdeen research predicts that 50% of best-in-class retail organizations are more likely to use artificial intelligence (AI) or AI-enabled platforms in support of their retail organization. To learn more about how best-in-class retail organizations are using AI, click here to access the full Aberdeen report.
The result of using smarts like these? Analytics that go way beyond descriptive dashboard reporting and put advanced analytics, smart data discovery, natural language queries, and sophisticated data storytelling capabilities in the hands of every data-driven professional in your retail organization. Everyone works more efficiently and effectively, and your company is better able to increase profits while delivering exemplary customer satisfaction.
One real-world example is a premium shoe company that uses smart analytics to discover new sales insights, detect regional preferences, and make smarter decisions about which items to place in which stores. As a result, the company is boosting sales, customer satisfaction, and loyalty, even while reducing inventory levels. Another example is an international retail company that is empowering business users to serve themselves with the data they need and transforming the IT team from a producer of reports to an enabler of business insight.
And the company delivering this new breed of analytics? Is it a disruptive vendor new to this space? No. It’s IBM. This modern, augmented intelligence-driven, automated solution is Cognos Analytics.
Fall in love with Cognos all over again — or for the first time
That’s right; we’re revamping our flagship BI software to include machine learning, automated pattern detection, intelligent and interactive dashboards, and simple, reusable, drag-and-drop reporting. Here’s an example:
You will be delighted with the beautiful visualizations showing things like peak customer buying times across the southeast U.S. and how to better staff stores in that region, or that show a pattern of sales to enable you to move product that isn’t selling from one country to another where it is in high demand.
But more importantly, your retail organization will be amazed at how Cognos Analytics takes your data and turns it into insights that you can act on and trust. Everyone from store management to marketing to procurement to the C-suite will have complete confidence that you are all making the right decisions about what will boost sales, attract new buyers, and delight every customer.
If you’re interested in discovering what else is coming to Cognos Analytics, be the first to hear the new announcements by registering to attend our upcoming IBM Analytics University events, September 17–20 in Stockholm and October 2–5 in Miami.
Want to learn more?
Want to dig into the details of smart analytics in retail? Sign up now for the on-demand webinar: Trendsetters Rejoice: Omni-Channel Retailing in the Age of AI and Enhanced Analytics.