Hyperlocal Data Is Already In Retailers’ Store Cupboards – Just Take The Wrapper Off!

0aaLaurence Haziot IBM Global

The retail industry’s disruption has many sources — demographic shifts, changes in consumer attitudes and behavior, as well as new and non-traditional competition are just some of the factors.

Technology has enabled retailers and CPGs to adopt new ways of interacting with customers. As curious companies and individual entrepreneurs across industries started to dabble and explore, they created innovation after innovation. So much that across many industries, the nature of how companies provide value, interact with customers and employees, as well as operate their entire businesses has been forever transformed. The fuel behind much of the most recent innovation in retail is cognitive analytics, which empowers companies to tap into insights about how people shop, what influences them and why they might prefer one location over another.

Consumer expectations continue to outpace most organizations’ ability to keep up and there is an inherent need to be understood as an individual whilst stores are looking to provide small business familiarity. Consumers have become accustomed to rewarding great retail experiences with glowing reviews, but equally punish poor outcomes with immediate negative posts on social media.


The disruption goes beyond just the consumer though, with the original online disruptors to the market now dipping their toes into physical stores, extending into different markets and also still innovating with different way as to how goods get into the hands of consumers.

The industry is now seeing that Bricks & Clicks is the new norm, fueled by physical and digital consolidations, supply chains transformed and store operations revolutionized. Popping up on the high streets are new stores, with morphed concepts introducing new formats or concepts, along with checkout-free areas or testing locations where retailers trial new thinking.

Take for example one fashion retailer that has located a store at the basement of a student accommodation block. There’s not a traditional feel to the store, more a place to hang out with products all around. It features a laundrette, coffee station and on the spot customization of items for sale in the store. It’s a location that the students will continue to go through on a regular basis. This helps not only to reinforce the brand, pampering to the needs of the students who would go elsewhere for their laundry, but also through a customization area connects the brand in a very individual way to each student. This just shows that consumer companies have a lot to contend with as the pace of change continues to accelerate. It’s lead or be left behind.

To keep up with the speed of change, there is one area that all consumer companies can rely on — DATA. Data is the fuel of all innovative technologies and it is all around every store, individual and location, and comes in multiple forms. Be that socio-demographic, geo-local shopper reviews, influencer blogs, local mobile search, points of interest or weather data, consumer goods and retail companies can rely on hyperlocal data to pinpoint exactly where to locate their stores, determine the right merchandise for each location,where to send the right product at the right time and to optimize their supply chains. Using cognitive insights from shopper data combined with weather forecasts, local events or holidays, demand forecasts can be dynamically updated by store and by product which allows the local level retailers to adjust orders accordingly and avoid excess inventory or out-of-stocks.

That said, this isn’t a one-off pill to solve the issue but requires a continued approach and monitoring to react to data as it comes in. No day is ever the same so consumer companies need to have a continual eye on up-to-the-minute data that also takes in social trends and local events.

The key first steps to evolving the supply chain are to start with neighbourhood-level understanding of consumers’ wants, needs and desires, and then work upstream. Brands must translate the huge amounts of information that exist at the local level into demand signals, and then digitize the entire supply chain to be more flexible and nimble. This will improve speed to market and reduce excess inventory and cost.

What may not be so apparent is that hyperlocal data is not just about optimizing supply chains. It also can help to streamline activities in other areas of the business, such as merchandising, operations and marketing. People can analyze the data and trends to swiftly prioritize what actions to take on a very local level.

Putting data to work can mean that consumer companies can see a 3% revenue increase using data-driven methodology to define the right product assortment across each store. It’s about time that the incumbent retailers and consumer companies fight back against the disruption using a resource that they are already sitting on — data. Harnessing this data, transforming it with analytics and discovering new opportunities with AI is the way retail winners are able to distance themselves from others. Doing it at scale requires a reimagination of retail business models.


Laurence Haziot is IBM’s Global Managing Director and General Manager for Consumer Industries.  She is responsible for the overall consumer industries business globally, and within this role she establishes the strategy and the offerings as well as developing the ecosystem. She is a member of IBM’s Performance Team, led by IBM’s Chairman, and in charge of several multi-disciplinary organization-wide transformation initiatives addressing large transformational deals or customer centricity. As a female senior executive, she is passionate about using her experience to help IBM women prepare for executive roles and to foster a work environment where women can flourish. Therefore, she is the Executive Sponsor of the IBM Executive Women Council for Europe. She joined IBM in 1986 as a Client Executive for the Nuclear and Research Industry, then held several similar position in Media and Communication Industries.

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