Can location intelligence provide a lifeline for retailers?
Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.
With online growth crashing any assumption that consumers need to head to the store to get highly-replenishable products cheaply and quickly, fast moving consumer goods (FMCG) and general merchandise (GM) retailers are racing against time to rethink their physical selling locations in the context of consumers’ digitally enabled shopping journeys.
That trend is evident in RSR’s recently-published benchmark entitled, “Location Intelligence In Retail: The Value Of Where.” As shown recently in other RSR benchmark reports, FMCG and GM retailers are more enthusiastic about new data analytical capabilities than others, particularly fashion and specialty merchants.
The greater interest might be because product differentiation is among the most important value drivers in verticals such as apparel. For FMCG and GM retailers, price and convenience are top value drivers — and those value attributes are under constant strain because of competitors like Dollar General, Walmart and Amazon.
Granting that we are still in the early days for analysis of geo-location data typically generated by consumer “smart mobile” devices and the insights that can be generated, the study finds FMCG and GM retailers believing the analytics can play a vital role.
Technology adoption still faces considerable hurdles. Among all respondents, the top organizational inhibitor was found to be overarching privacy concerns, cited by 59 percent of retailers and up from 46 percent in the 2018 study. Other inhibitors were seen as proof of ROI, 49 percent; concerns over the “creepiness ” factor of tracking, 53 percent; and the retailer’s profitability based on standardized assortments and store layouts, 44 percent.
- RSR Uncharted: Location Intelligence Could Be A Lifeline For FMCG & GM Retailers – RSR Research
- Retailers Want To Know Customers’ Geo-Location – A Lot – RSR Research
- Location Intelligence In Retail: The Value Of ‘Where’ (study) – RSR Research
- Rule #1 of location analytics in retail – don’t be creepy – RetailWire
DISCUSSION QUESTIONS: Will geo-location analysis gain traction as a retail tool this year or are the privacy concerns and other hurdles too high? Do you see sufficient ROI from the technology to support investments at this point?