Retail Trends Playbook Excerpt: Leveraging Data For Responsive Merchandising
From heat-mapping to forecasting algorithms, these three retailers are leveraging local data intelligence for real-time and relevant merchandising in physical stores
Companies are sitting on a wealth of data about their shoppers, their stores and the broader marketplace, but they often lack the internal capabilities and creative insight to put it to use. Research indicates the tide is changing: 50% of companies are implementing planning and forecasting technologies, with an additional 32% increase in investments by these companies in the next year.
Successful brands and retailers are differentiating themselves with data-led initiatives that enable them to quickly adapt or even anticipate shifts to be first to market with new products inspired by local purchase patterns to better serve the needs of their customers. As reported in PSFK and Microsoft's Retail Trends Playbook 2020, these three top retailers exemplify how brands can optimize success with predictive data and analytic software:
Nike By Melrose
Sportswear retailer Nike stocks products in its LA concept store, Nike By Melrose, based on the shopping preferences of local users. Using data collected from its NikePlus app, the store’s merchandising mix is dictated by items local consumers are buying. Every two weeks, the store will add new inventory based on the local market, much faster than the brand’s usual turnaround of 30-45 days. Shoppers will also be able to leverage the data to help inform their choices, browsing on in-store screens to see the most popular shoes in a given category for consumers who live in zip codes near the store.
Tmall Global, the first physical location of Alibaba’s luxury ecommerce platform Tmall, stocks products based on the online shopping habits of consumers who live within 5 kilometers of the store. The Hangzhou store uses data and algorithms, carefully studying consumer preferences in order to forecast future shopper needs and stock the physical location with preferred items in categories such as beauty and personal care, accessories and even wine.
The North Face Prototype
The outdoor retailer’s new Brooklyn-based storefront is designed to be a ‘retail lab’ and gather key information about local shopper behaviors, such as stocking inventory based on local consumers’ interests. It also uses heat mapping to determine what sections attract the most shoppers.
The Retail Trends Playbook 2020 is a report by business intelligence platform PSFK in partnership with Microsoft that presents key trends, best-in-class examples and strategies for executing intelligent retail with the aid of data-driven technologies. Download the full free report here.
Lead image: stock photos from Monkey Business Images/Shutterstock