Teen apparel retailer ‘gets schooled’ on predictive analytics
Rue 21 made a strategic decision to ensure it could get the biggest return on its predictive analytics investment.
To accurately complete the adoption of predictive analytic technology across the company, Rue 21 used Action Learning, a core methodology used by the University of Liverpool. Action Learning is an experience-based and action-oriented approach to organizational learning.
The organization worked with First Insight to adopt consumer-driven predictive analytics when making design, buying, planning and pricing decisions across its apparel, footwear and accessories categories. These decisions were based on customer sentiment. To ensure the company stayed on the right path, the organization implemented action learning with executives, merchandising teams and planning and inventory teams, a move that Rue21 fully adopt the solution within three months.
The program was championed by Mark Chrystal, the company’s chief analytics officer, and a graduate of the University of Liverpool’s Doctorate in Business Administration program. He studied the learning process while attending Liverpool University.
“Too often organizations take a top-down approach when trying to integrate new solutions into the company,” Chrystal said.
“Action learning empowered the merchandising team at Rue21 and has given a voice to every individual, no matter the level,” he added. “Organizational adoption of the First Insight technology and its incorporation into our business processes has been instrumental in improving our business performance.”
Since adding the solution, Rue21 is evaluating a greater number of products, and reflecting direct consumer input in their buying decisions. “We have already seen margin improvements of up to 600 basis points on the products we have processed through the First Insight platform,” he added.
Rue21 currently operates 752 stores in 45 states.
Manual intervention is hindering the customer experience
By failing to automate pricing and replenishment processes, brick-and-mortar retailers are failing to improve the customer experience.
This was according to data from Blue Yonder, a JDA company, which pointed out that 96% of retailers rely on manual processes for their pricing and replenishment strategies, despite near universal recognition of the benefits that greater automation could bring.
Relying solely on manual intervention to execute critical processes, such as pricing and replenishment, retailers subject themselves to inaccuracies, like not having the right products available or priced at a sub-optimal level, resulting in lost sales. The good news is retailers are ready for a change.
A majority (90%) of companies plan to increase or maintain their physical store presence, as well as innovation. On average, retailers plan to invest 36% of their IT budgets in new technology, such as artificial intelligence (AI) to meet the demands of customers and prepare for the future of retail.
Half of companies (53%) openly admit that there is room for improvement in their replenishment process, while 54% said the same for their pricing strategy. For example, 58% of retailers reported that automated replenishment would generate a better customer experience, and 56% said that automated pricing would result in improved profits.
Intelligent technologies, such as automation and AI, can not only provide insight on pricing and forecast stock levels, they can deliver better replenishment and pricing decisions to retailers. AI solutions can also analyze vast quantities of data to completely automate these processes and eliminate the burden of manual intervention, enabling retailers to devote more of their resources to improving the customer experience, according to the report.
“It is clear that retailers recognize the benefits that automation can bring to their businesses, but perhaps most significant is the agility it gives them to compete with their e-commerce rivals,” said Uwe Weiss, CEO of Blue Yonder.
“Online retailers have been able to make small and regular adjustments to their pricing for years, instantly reacting to consumer demand and trends to keep their prices optimized and maximize sales, while brick-and-mortar retailers have been trying to manage with manually-operated, outdated and static pricing strategies,” Weiss added. “However, with automated pricing solutions, retailers finally have the flexibility and agility to optimize their prices in their physical estate, delivering a better experience for customers and enabling them to compete more effectively with their online rivals.”
Amazon wants members to choose their ideal ‘Amazon Day’
Amazon Prime members are getting yet another perk, one that complements the membership’s signature free, speedy shipping.
Amazon is slowly rolling out a new delivery option in the United States, called Amazon Day, according to CNet.
The invite-only program lets members set a specific day of the week for their shipments to arrive. Customers choose their preferred “Amazon Day” date during checkout, and that’s when orders will arrive, the report said.
Most items that are available for two-day deliveries will have the new Amazon Day option, CNet reported. Prime members will still be able to select their regular one-day, two-day and no-rush shipping options, when available.
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