Customers flock to support manufacturers and retail organizations that really understand their wants and needs. Increasingly, in fact, retailers and manufacturers need to leverage customer insights to unlock competitive advantage to make better category decisions and achieve localized merchandising, according to the JDA Voice of the Category Manager survey, conducted by JDA Software Group.
“Historically, category management strategies have been done based on demand signal and a lot of gut feel and instinct buy category managers,” Kent Ruesink, senior director, Product Management Group at JDA Software told EBN. “The biggest thing we saw was the need for both retailers and manufacturer partners to have a better understanding of consumer behavior.”
To that end, retailers are investing in data-related technology. “Companies are realizing that the path to success in today’s omni-channel market is to analyze and react to consumers’ preferences and behaviors; ultimately truly understanding how, why, and in which manner they wish to shop,” said Todd McCourtie, senior director, solution strategy at JDA. “Data-driven technologies can help companies make more informed localized merchandising decisions that, in turn, enhance the shopping experience for the customer and improve the brand’s bottom line.”
Forty-one percent of survey respondents pointed to big data and analytics as a primary investment priority in the next five years. Next most important is investment in customer-driven data science (37%). The survey polled nearly 100 professionals responsible for category management and merchandising activity in North America. “The fact that manufacturers and retailers plan to prioritize investment in big data and predictive analytics over the next five years is a true testament to the transformational impact that the modern shopper is having on these sectors,” said McCourtie.
The key to success is translating data about customer shopping habits and preference into actionable information. That’s a skill that most organizations are still chasing. In fact, only 17% said that they are highly successful in mining data to get usable insights, compared to 82% who characterized themselves as somewhat successful.
The survey points to the huge potential in these activities helping category managers forge a path forward. “I think we are at the tip of the iceberg,” said Ruesink. “It’s just beginning to play out in what their value is in category management and merchandizing, both in the physical world and online world.”
Click on the image below to start a slideshow of two infographics that outline the results of the JDA survey, first from the manufacturing perspective, then from the retail perspective.
— Hailey Lynne McKeefry, Editor in Chief, EBN