Top-performing retailers are accelerating their efforts to establish a tighter control over customer data, with 70% tracking new product adoption, 100% tracking promotion participation, and 91% tracking product preferences and affinity, according to a study by Aberdeen Group.
The study report, entitled Business Intelligence in Retail Customer Management: Bringing Information Together to Build the Accurate Customer Profile, highlighted the top uses of business intelligence (BI) for customer management, including:
· Cross-selling and up-selling (56%);
· Loyalty rewards programmes (54%);
· Sales analytics (51%).
The report also examined current measurements of traditional customer buying patterns, such as conversion, retention, and acquisition.
The retailers surveyed indicated that there are many potential benefits of increased customer data management. According to report author and Aberdeen retail research analyst Greg Belkin, "The report found that nearly half of retailers surveyed believe their data is not reliable enough for analysis. The big challenge for retailers, therefore, is to get their internal data management processes in order to attract more business and grow revenue."
The report provides a snapshot of how leading retailers are already taking advantage of business intelligence, and how they are meeting the challenges of internal data management. But there are still areas of opportunity many retailers have yet to address. For example, 82% are using BI on an enterprise-wide basis, but only 16% (rising to 33% for best-in-class companies) use real-time or near-real-time business intelligence data measuring techniques.
Data gap observed
Although all of the best-in-class retailers surveyed measure their customer retention rate, retailers generally noted a significant difference between data collection and actual utilisation of that data. In fact, only 33% of all respondents said they use this measurement as a top BI related key performance indicator.
The report, which was underwritten by Microsoft and SeaTab Software, has been made available as a download from Aberdeen Group's web site - click here (free registration required).