Data has long been part of the business of retailers and brands. But as data science continues to evolve and improve, companies can use data in new and better ways to ensure optimal margins in a time of shrinking market pressures.
Barbara Connors, Vice President of Strategy and Acceleration at Kroger’s data division, 84.51°, highlights the ways in which data science can reveal important nuances of what works best to influence consumer behavior in a market defined by macro influencers such as inflation, COVID and hybrid shopping. “There’s an increased emphasis on a few things,” Connors told Progressive Grocer in a recent interview. “First, there is a democratization of insights. It’s about extracting insights from a limited, limited team and across the business in a way that can be used by people with different levels of data and insight expertise.” What this democratization of data can do, she said, is engage more people in what insights mean and unlock customer-centric innovation.
Another emerging area of data influence is the increased focus on predictive analytics. “When you have a lot of uncertainty, you need confidence levels based on real, detailed data, and you can use advanced technology like predictive analytics to provide a competitive point of difference,” Connors explained.
With buzzwords like “predictive analytics” and “AI” now a reality, making them more widely available across the organization helps grocers and brands meet the needs of their shoppers wherever they are. “We hear everywhere that companies want to make data science a competitive advantage in their organization and transform their business, and there are different factors that are necessary to do that,” Connors pointed out.
Technical acumen is one of those factors, and cultural readiness is another. “You have to have the right skills from a technical perspective and, from a cultural readiness perspective, you have to have a business that is willing to invest in the data, technology and teams, and also has a commitment to better connect the science team data with the business team. Aligning the right priorities ensures that business needs are translated appropriately and connects insights to action,” said Connors.
Of course, not all businesses have these two factors in play at the same time. “There are companies that have the cultural readiness but haven’t invested in the data and the teams to do it. We call them ‘ambitious companies’ – they want to make sure they’re getting it right, and it almost fetters them,” she noted.
On the other hand, there are tech-savvy companies that aren’t quite there yet culturally. “They’ve attracted really techies and PhDs, but they’re holding back on delivering on the ROI promise. The unlock for them is connecting to the business and embedding data in the business teams,” Connors noted, noting that there are ways to help translate the languages of technology and business groups.
According to Connors, retailers and brands in general are moving closer to aligning and using data science to its full potential as a function. Once there‘With alignment, the next step is getting quality data and using a platform that offers not only curated point-and-click reports, but also raw, aggregated data. To do this, 84.51° developed the Collaborative Cloud platform that gives data professionals access to market behavior of Kroger’s 60 million households with transaction-level granularity. “Wthrough the Collaborative Cloud, we’ve taken the data fueling today’s data and put it into a platform that’s designed for data scientists in a platform that’s also privacy-friendly,“ Connors said.
Having an infrastructure built around data and communication is critical to the success of combining these functions. “We get a lot of questions about creating an organizational design and creating teams that communicate with each other,” Connors noted.
She added that as a result of the fast-moving pandemic, supply chain shortages, labor challenges and inflation, companies may finally be able to move away from sorting mode in the near future. “When things settle down, strategy will be the foundation,” Connors said.
Serving 60 million households annually nationwide through digital shopping and nearly 2,800 retail grocery stores under various banner names, Cincinnati-based Kroger is No. 4 on The PG 100, Progressive Grocer’s 2022 list of top grocers of food and consumables in North America.