How Retailers Can Establish a Data Foundation for Digital Acceleration
Successful retailers in 2022 understand that digitization isn’t enough — digital acceleration is crucial. The state of digital acceleration that was sparked by mass quarantining during the COVID-19 pandemic changed how businesses operate and consumers behave. According to Gartner, 65 percent of executives say they accelerated their digital initiatives' pace in 2021 — and this accelerated pace must continue. In the retail space, in particular, those that have normalized this faster pace, focusing their strategies on digitalization and data integration, have had the most success.
As we continue through the second half of 2022 and into 2023, we will see more retailers adopting unified data platforms as part of their accelerated digital strategies. Unified data platforms, put simply, help companies establish a solid data foundation, providing a trustworthy and integrated repository to both store and analyze data across all elements of the business.
Having a data foundation sets businesses up to truly know and understand their customers, and it enables them to track shifts and changes in demographics, buying behaviors and values. This detailed data analysis enables businesses to fine-tune their lead generation strategies more quickly and effectively, increasing sales. But beyond helping retailers sell more products, unified data platforms also accelerate retailers’ ability to establish meaningful relationships with their customers.
As we enter into the recession, we must focus on accelerating our digital transformation strategies to improve customer experiences and make businesses more agile.
Supply Chain Agility is a Must for Struggling Businesses in 2022
Much like the retail industry, restaurants and consumer goods industries faced a myriad of complex challenges during the pandemic. New public health standards and mass quarantining caused revenue losses, decreased in-person dining capacities, and product shortages across the board. To re-engage the public, restaurants needed to pivot their strategies.
McKinsey reached out to leaders in the industry for insights on the struggles they were facing, and 93 percent of respondents said they intended to make their supply chains far more flexible, agile and resilient. This is where the power of a solid data foundation comes into play.
Chipotle adopted the xDM platform for master data management as a step toward improving the flexibility and agility of its supply chain. Prior to the adoption, opportunities existed to improve the analysis of metrics across multiple systems and departments to improve data management. This poor data management slowed Chipotle's response times to supply chain issues, product changes, and unique emergencies faced by individual stores. Digital acceleration was necessary to win back the loyalty of Chipotle customers and employees across the country.
With the xDM platform streamlining Chipotle’s data into a holistic and centralized data hub, the restaurant chain was able to increase efficiencies, taking complete control of records across its 2,500 locations. As a result, Chipotle was able to predict and plan for supply chain snags, implement a customer loyalty program, and cultivate a comprehensive digital presence.
Strong Data Management Increases Brand Visibility and Relevance
The retail landscape in 2022 has shifted dramatically to a focus on e-commerce. Morgan Stanley reports that the global e-commerce market increased from 15 percent of total retail sales in 2019 to 21 percent in 2021. The market is expected to grow to $5.4 trillion by 2026.
Keeping up with the growing retail industry means developing a data foundation through rapid digital acceleration and branching into e-commerce. This was especially true for classic family-owned shoe retailer Red Wing Shoes.
Founded in 1905, Red Wing Shoes implemented a centralized data hub as part of its accelerated digital strategy. For this brand, maintaining visibility and customer loyalty required a 360-degree approach dedicated to managing data while prioritizing the buyer’s wants and needs. Red Wing Shoes used the hub to learn more about its customers and what they value in their buying experience. Data insights enabled Red Wing Shoes to maintain its classic brand persona while catering to an audience that values e-commerce options.
So how can other retailers follow suit and leverage their data to the fullest? The answer is building a solid data foundation. Although it may take time to unify your company’s data records, it will allow you to stay aligned with your customers through unprecedented times.
TH Herbert is the CEO of Semarchy, a unified data management platform.
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TH Herbert is the Chief Executive Officer of Semarchy. He has an extensive history and experience in Enterprise Software Technologies across Sales, Services, Technical, and Executive Management.
Prior to joining Semarchy, TH held various executive and sales leadership positions in International Technology organizations. He was Senior Vice President of Sales for AST Corporation, a large System Integration Firm, as well as Head of Operations in Australia, APAC, and Europe. TH has also previously worked as the CIO of Profitline a Telecom Services Company in San Diego, several startups, and spent over 7 years at Siebel and Oracle prior to that.