Business Objects, a provider of business intelligence (BI) solutions, announced key findings from a survey of U.S.-based retailers that concludes retailers are increasingly using business intelligence and detailed transactional data to drive their business decisions. The survey, conducted by the Retail Systems Alert Group, a provider of objective, high quality information resources for the extended retail industry, also offered areas where retailers can more fully leverage their business intelligence data.
Key findings of the 2005 Business Intelligence in Retail Survey include:
Retailers are Expanding Beyond Item Movement Trends and Ranking Analysis
Many retailers are building on basic sales trend and ranking analysis and inventory reporting capabilities to understand and drive the buy-and-sell sides of their business. Seventy-five percent of those surveyed are using business intelligence to study the effectiveness of their marketing campaigns by geographic segments and to track customer segments responses. Additionally, more than three quarters of the respondents are using business intelligence to make decisions about future inventory levels, and analyze current and historical data about product movement through the supply chain to impact future order cycles.
Retailers Use BI to Drive Replenishment, Assortment and Supply Chain Optimization
Business intelligence is now being used to influence and even drive merchandising decisions. Promotional merchandise initial allocations (79 percent), replenishment of orders (75 percent), and assortment planning by store (73 percent) ranked as the top indicators that are impacted by business intelligence data.
Delivering a Focused Value Proposition to Customers
Most retailers surveyed still do not use business intelligence to calculate the lifetime value of specific customers, nor do many create cross-sell/up-sell opportunities with their data. Less than half of the retailers in the survey analyze customer acquisition and retention. Together, this creates huge opportunities for the retailers that can leverage BI information for better targeted marketing campaigns.
Business Intelligence Tools in Use
Finally, the survey determined that most retailers do store large volumes of operational data including inflows and outflows of merchandise (81 percent), detailed item sales from POS (89 percent), and detailed store level inventory transactions (76 percent). Sixty percent keep a central database of customer-related information.
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