Most global grocery retailers (85%) lack the capabilities, technology, people and processes to monetise their data and drive customer experience, The Future of Retail Revenues Must Be Data Led study, conducted by Forrester Consulting and released by dunnhumby, has revealed.
However, growing new revenue streams was named as the top priority for 2020 for 83% of Australian grocery retailers, by improving use of data insights to develop customer strategies and make business decisions.
dunnhumby global retail director, David Clements said the study findings highlight the growing importance of the role of customer data in attaining sustainable growth.
“Many businesses in the global grocery market are in a fight for survival with heightened competition from discounters, pure plays and other non-traditional competitors, while the cost of doing business is increasing, further squeezing thin margins.”
The study found three levels of maturity in grocery retail – leaders (15%), intermediate (55%) and novice (30%). Leaders show improved supplier collaboration by sharing customer data insights, solutions to support media planning and negotiating annual trade agreements. Retailers in the US, the UK, Brazil, Italy and Thailand standout as early leaders in developing customer strategies that drive revenue growth.
Meanwhile, Australian retailers are facing obstacles including cultural barriers to using data to drive decision making (51%), lack of access to data (43%), lack of data management tools or technology (40%), and an inability to harmonise data and recommendations across channels, banners, brands, and locations (37%).
Only 42% of grocers sell branding opportunities on their website and only 37% offer media placements in-store and in print media. But 96% of grocers who offer media opportunities for suppliers on apps saw an increase in revenue over the last 12 months with 40% seeing an increase of more than 10%.
“Time is of the essence for grocery retailers to activate the data they already have to improve the customer experience and create new revenue streams that can support their businesses into the future. There is a significant amount of untapped revenue in grocery,” Clements said.
“Those that unlock the potential of their data and media assets and improve supplier collaboration will thrive, while retailers that fail to adapt will fall behind in an increasingly competitive marketplace.”