The rate of change has never been greater — or faster — for the footwear industry, with new challenges popping up every day in nearly all corners of the business, from navigating cash crunches and supply chain issues to understanding the latest technological advances. In its new “Ask An Expert” series, FN will ask industry leaders — all solutions-based providers — to take on some of the most timely topics.
The footwear industry is becoming increasingly digital, with both B2B and B2C embracing online solutions. This adoption of technology for internal management and external business is creating a wealth of data points, from inventory counts to consumer preferences. Companies can use this data to streamline their performance, but only if they know how to take advantage of the information.
Brian Cluster, industry strategy director at data management company Stibo Systems, spoke with FN about how companies can unlock the data they already have and improve their business performance.
FN: Data has been a retail buzzword for years now, but some retailers are intimidated by this kind of abstract technology. What would you say is the value for a small retailer in collecting data?
Brian Cluster: Three years ago, The Economist said that the most vital resource is no longer oil — it’s data. I think the No. 1 value is a greater understanding of how to improve and help serve your customers better. Big data could be a scary thing for some retailers, but they don’t need to tackle that right away. Think about smaller data: the data that they already have or that can easily be accessed. It’s the data about your products, your suppliers, your locations and your customers that is important to really master, to have a good quality foundation for your business.
FN: For businesses that have not previously introduced any kind of data collection/analysis into their strategy, where is the best place to start?
BC: For small retailers, it starts with a data audit. Basically, consider doing an inventory of all the data that you have. What is it? What’s the quality of it? And then, most importantly, what questions does it answer? That’s where I would start. Secondly, I would identify the questions that you have for your business that are not being answered by your data, your technology or your team. And then thirdly, I would map those questions to the types of data and research that you will need to close that gap and answer those critical business questions.
FN: Connecting with the consumer is a big focus for many footwear companies right now. How should they be leveraging data to improve this customer relationship?
BC: It’s time for retailers to invest the time and money into their customer digital experience and communication. Your customers, the fans of your company, want to know what’s happening with your company: What are you doing right now and how can they get access to your product? One way of doing that is by asking them to be more involved with your brand, such as through participating in a survey. If you have a community, if you have their emails, let’s create a survey to understand their needs and interests, and then follow up with plans to actually meet those needs going forward.
FN: The pandemic has stretched many companies thin. What are some small, inexpensive actions that they can take with their data, for maximum impact?
BC: It’s a good time to think about adding a form on your website to invite people to be part of your community. That’s a simple, free thing that you can do: Ask them to put in their email and be part of your newsletter or email campaign. From a data perspective, it’s time to evaluate your customer data and make sure that it’s accurate, that you’re using the right name and the right email address, etc. You can do the same thing with your suppliers. And then, once you do that data audit, face the facts about your data. Start prioritizing and figuring out how important these products are strategically so that when you’re ready to invest in better data, you already have the plan laid out.
FN: Are there any common misconceptions that companies may have about the role of data in their business, that are important to dispel?
BC: There is a misconception that you can continue to work around data issues. Some companies have been around for a while and they’ve put together a patchwork of solutions instead of facing the facts. But now you have the time to ensure that the workflow is efficient, so you’re not wasting your time or your employees’ time with these work-arounds.
Another misconception is the “more data, the merrier” or “big data is the answer.” That’s great for the larger companies that have dozens of locations, but most companies don’t need to do that. However, the foundation of your data — your products, your customer, your supplier data, your sales information — all needs to be accurate, useable and transparent to your organization, in order to enable better decisions.