Most grocery retailers around the world lack the capabilities, technology, people and processes to use insights to monetise their data and drive customer experience, according to a new report.
Commissioned by dunnhumby, the customer data science business, research by Forrester Consulting involved an online survey of 613 respondents and 13 interviews with decision makers involved in the strategy and management of data analytics and/or customer strategies at grocery firms globally.
This concludes that 85% could do significantly more with their data to improve the customer experience and drive additional revenue.
Forrester uncovers three levels of maturity in grocery retail:
• leaders (15%),
• intermediate (55%) and
• novice (30%).
Leaders, it says, set themselves apart by showing improved CPG supplier collaboration by:
1. sharing customer data insights,
2. providing insights and measurement solutions to support media planning, and
3. negotiating retail media placements as part of their annual trade agreements.
Regionally, retailers in the United States, Brazil, Italy, United Kingdom and Thailand stand out as early leaders in developing customer strategies that drive revenue growth, the report states.
But almost all (96%) experience challenges in using data to develop such strategies, for reasons that include a lack of data management tools, inconsistent or incomplete data, and an inability to harmonise data and recommendations across channels, banners, brands and locations.
Most grocers globally are not capitalising on the revenue potential of customer data and in-store/online media channels, the report adds.
Globally only 31% of grocers are selling branding opportunities on their mobile apps except for in the UK (37%), Brazil (49%), China (47%), and Spain (38%) where apps are used more frequently.
In the UK, grocers who offer media opportunities for CPG suppliers on their apps saw an increase in revenue over the last 12 months, the report finds, with 59% seeing an increase of more than 10%. In addition, 93% of UK firms offering ads and branding opportunities on their websites saw an increase in revenue from this channel.
“There is a significant amount of untapped revenue in grocery,” said David Clements, Global Retail Director at dunnhumby.
“Those that unlock the potential of their data and media assets, and improved supplier collaboration, will thrive. Retailers that fail to adapt will fall behind in the increasingly competitive marketplace.”
A WARC Trend Snapshot looks at how how Walmart, Kroger and Target are exploring if, like Amazon, they too could exploit the customer data they possess and build an advertising business, with the aim of both increasing basket value and using ads to mitigate revenue losses.
Sourced from dunnhumby