2019 Review of the Year: Retailers power up for data

shop_1From Marks & Spencer and Dixons Carphone to Asos and Topman, retailers have finally embraced the data revolution, although quite why it has taken them so long – and quite when they will start to see results – is anyone’s guess.

To be fair, as far back as 2017, M&S boss Steve Rowe insisted the retailer wanted data analysis “to become the glue that sits above our business units and underpins the brand” but it seems that glue is taking forever to set.

It was not until September 2018 that the firm hired its first ever chief digital and data officer; some three years after launching the Sparks loyalty scheme.

This year has seen more high profile appointments, with former Asda chief Andrew Mann joining as head of insight and loyalty, ex-Tesco Clubcard director Danielle Papagapiou being appointed head of loyalty and GroupM vice president of data science Mehdi Hosseini becoming head of data science.

The retailer also works with Starcount, the company run by DunnHumby co-founders Edwina Dunn and Clive Humby. In addition, M&S has a strategic artificial intelligence partnership with Microsoft, a data science academy in partnership with Decoded, a deal with predictive analytics specialist First Insight and a start-up incubator programme alongside Founders Factory.

You can’t fault its commitment; whether next year’s planned relaunch of the Sparks card will finally trigger the turnaround shareholders are demanding remains to be seen, of course.

New blood to boost the turnaround
Dixons Carphone is another business which has brought in new digital and tech executives as it ramps up its transformation programme in an effort to turn round the business.

The company, which owns the Carphone Warehouse and Currys PC World brands, has drafted in Merlin Entertainments chief digital marketing and information officer Mark Allsop to the new role of chief digital officer, while Dyson chief information officer Andy Gamble joins the retailer as CIO.

For online fashion giant Asos the journey is just beginning. It has only recently appointed its first chief growth officer, who has been charged with integrating activity with data analytics, customer experience and strategic planning.

In the first of a number of key appointments, the beleaguered retailer has recruited Robert Birge to the role; he will lead a marketing team of 170 people and a customer care operation of more than 1,200, reporting to chief executive Nick Beighton.

Ironically, earlier this year, Asos was forced to axe over 100 head office jobs on the back of an crash in interim pre-tax profits, with the marketing team taking the biggest hit.

Sir Philip Green’s Arcadia Group, which owns Topshop, Monsoon, Dorothy Perkins, and Miss Selfridge, has also jumped aboard, hiring former Tesco chief Rafaele Petruzzo as group chief digital officer.

How the cloud is clearing up the picture
Meanwhile John Lewis Partnership recently merged the John Lewis and Waitrose teams in a move which will see one in three senior head office posts scrapped as part of a £100m cost-cutting exercise.

However, there is still no sign as to whether they will roll out a new joint loyalty card, bringing together the MyJohnLewis and MyWaitrose schemes, which has been on trial.

But behind the scenes, at least, the two retailers have been tapping into a centralised data platform to break down data silos across the organisation, as part of a drive for a more omnichannel approach to customer insights and service.

It has now implemented Google Cloud to help deliver better experiences for customers, across app, website, and in-store in both John Lewis and Waitrose.

The Partnership Data Platform, hosted on Google Cloud, is designed to automate decision-making and facilitate access to data across a much broader range of products. It serves as the basis for AI and machine-learning projects, allowing for more accurate customer insight and segmentation, and enabling smarter service and better experience. Well, that is the plan, at least.

The rise and rise of machine learning
And it is one which Sainsbury’s is also embracing by working with both Accenture and Google to implement machine learning technology to identify what customers want and the trends driving their eating habits.

The retail giant already gathers data from multiple sources; it has over 18.5 million members of the Nectar loyalty scheme and claims to have 33 million customer records at its disposal. To delve even deeper, Sainsbury’s commercial and technology teams, in partnership with Accenture, are building machine learning solutions on Google Cloud.

Sainsbury’s group chief information officer Phil Jordan said: “The grocery market continues to change rapidly. We know our customers want high quality at great value and that finding innovative and distinctive products is increasingly important to them.

“With the help of Google Cloud Platform, we are generating new insights into how the world eats and lives, to help us stay ahead of market trends and provide an even better shopping experience for our customers.”

Loyalty still paying dividends for some
Rival Tesco is banking on the expansion of its Clubcard loyalty scheme to keep its customers coming back for more.

This year it has already increased spend on the Clubcard 1.0 as it strives to convert its 15 million members to the digital app. With the launch of Clubcard 2.0 – officially known as Clubcard Plus – Tesco insists customers will save over £400 a year, even though it comes with a £7.99 monthly subscription charge.

The scheme gives 10% off two big shops worth up to £200 each, every month, plus 10% off F&F, Fred & Flo, Go Cook, Fox & Ivy, Tesco Pet and Carousel all year round, and double data for new and existing Tesco Mobile customers. Tesco has yet to reveal how many customers have signed up though.

But Tesco’s data division, DunnHumby, reckons retailers might talk the talk when it comes to embracing a data-driven strategy but few are walking the walk with the vast majority (85%) lacking the capabilities, technology, people and processes to use insights to monetise their data and drive customer experience.

Research commissioned by Forrester uncovered three levels of maturity in grocery retail, differentiated by data-led customer strategies for growth and improved supplier relationships: leaders (which accounted for just 15% of companies), intermediate (55%) and novice (30%).

Opportunities for data firms and consultancies
When it comes to finding the right skills, a separate study found that retail brands’ quest to build in-house data teams is being hampered by a dearth of suitable candidates in the market.

Yet out of adversity comes opportunity as this is creating major openings for data firms and consultants to step into the breach and support firms’ ongoing data strategies.

With data science and analytics now recognised as one of the key strategies to tackle high street woes, three-quarters of UK retailers are planning to invest more in their data operations, according to Knowledge is Profit, a Retail Week report.

While upskilling internal teams is the number one priority for the vast majority (74%), both purchasing external data and hiring data consultants feature heavily in their investment plans.

So, maybe not everyone wants the retail industry to get its house in order just yet then…

Related stories
Asos hires chief to unite CX, analytics and marketing
Forget Edgar, it’s data that’s really firing up John Lewis
Retailers ‘yet to unlock full potential of customer data’
Dixons Carphone drafts in top duo for digital revamp
M&S hires GroupM chief as first head of data science
M&S hires ex-Clubcard chief for Sparks card revival
Andrew Mann joins M&S as head of insight and loyalty
John Lewis MD handed top brand job in group shake-up
John Lewis and Waitrose set to axe marketing teams
Arcadia brings in new team for digital and data assault
Sainsbury’s taps into machine learning for insight blitz
Sainsbury’s turns to Nectar to forge data-driven future
Tesco plots huge Clubcard discounts for centenary push
Tesco boss confirms major Clubcard investment plans
Clubcard Plus ‘will save Tesco shoppers £400 a year’
Skills shortage triggers retail bonus for data experts

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