26 September 2018
Data-driven business
Data-driven business is hot! More and more retailers are increasingly using data as an important part of their business and this is of great benefit for the customers who get a better user experience as well as for the business partners who gain valuable insights based on customer data.
Data, data, data
In recent years, the use of intelligent data has become more and more important to the retailers who are now to an even greater extent using the valuable knowledge which is available from their data. This was also made clear at the world’s biggest retail conference ‘NRF Retail’s BIG Show’ in New York where it was emphasised that the topic is still hot. Data is used differently among the retailers and common to all of them is that it creates increased value. Value which in some cases can even been essential for the existence of the entire company.
Brendan Whitaker, Forrester
”We cannot be customer obssesed, if we are not data lead”
Design the physical shop based on online behaviour
Do you know the feeling of visiting a bookshop to be inspired for the summer’s beach entertainment but instead you are met by the most uninspiring sea of alphabetically sorted spines and this makes you give up on the hunt for the perfect time waster?
Don't worry; this never happens when you visit Amazon Bookstore. Via the use of intelligent data, Amazon has actually brought its online universe into the physical stores and has designed the stores according to the behaviour of the online customers.
Jennifer Cast, Vice President hos Amazon Books
“Rather than rely on just a few book store employees to cater to everyone's taste, we let our customers be the voice."
Amazon.com is much more than just a webshop. Amazon has been able to create a review universe in which the customers are happily writing reviews and are bringing back important feedback about every single product sold to Amazon.
Amazon is intelligently using this knowledge in the physical bookstore in New York to advice and guide the customers to find the exact book that is of interest to them. Instead of having the staff design the store and assume which books and topics that are interesting, Amazon has given the floor to the experts – namely its customers.
Categories such as “Page Turners”, “If You Like – You’ll Love” and “Hot Right Now” help the customers to find relevant books based on whether it has to be speed reading, the new favourite book or a current topic of conversation. Categories which have proved to be incredibly relevant to the decision-making of the customers.
Having several million reviews in its webshop, Amazon is also in possession of important information about each individual book which may be deal-breakers for its customers. Every single book in the store has been given a sign with online data consisting of information such as readers’ reviews from the webshop, number of stars and the total number of reviews of the individual book. Data which tells the customers everything about what other readers think about the book in question. In this way, Amazon is presenting its customers to expert knowledge which can be essential when deciding whether or not to buy the book.
By including online data in the physical stores, Amazon is creating a physical platform from which the customers get much of the same value as they would get if they were shopping in Amazon’s webshop. By intelligent use of data, Amazon has created a bookstore out of the ordinary which is value creating for its customers.
I have nothing everything to wear
Which designer do you want to wear today? Malene Birger? Rebecca Minkoff? Vera Wang? Imagine having a wardrobe of 450+ top brands and 65,000 pieces of clothing and accessories to choose from. The online retailer Rent the Runway has now made this possible.
Through a subscription-based business model, Rent the Runway has made high fashion available to everybody. For a monthly fee of only 89 dollars, Rent the Runway’s customers can choose between dresses, jackets, trousers, etc. from various high-end designers which they would like to borrow.
However, it was not that easy for Rent the Runway to persuade some of the world’s top designers to make their clothes available to everybody as they were afraid to lose value if their brands could be found in every home. But by means of a data-oriented business strategy, Rent the Runway offered the design houses valuable insights in return.
Rent the Runway
“We’re not in the fashion business! We’re in the fashion-technology-engineering-supply-chain-operations-reverselogistics-dry cleaning-analytics-business”
By having a data-oriented business strategy, Rent the Runway collects important information about each individual product from all the customers who have borrowed their clothes. In addition, Rent the Runway is responsible for cleaning the clothes and this is not an insignificant part of its business strategy. By collection user data from the customers and also collecting data about the impact on the clothes in connection with frequent use, wash and cleaning, Rent the Runway can return valuable data to the designers which provides them with much more knowledge about their own products.
Furthermore, Rent the Runway is also using the customers' feedback to advice other customers about the size of the clothes, the behaviour of the fabric and other information which may be relevant to know when the customers only see the clothes in Rent the Runway's webshop. Information that creates increased value to its customers. In this way, Rent the Runway has create a completely new market by making its business data-driven and thereby creating value for business partners as well as customers using their data.
Read more about subscription-based business strategies here.
Are you also interested in getting to know more about how your company can create increased value for customers and business partners by intelligent use of data? We would like to invite you for a cup of coffee or we can visit you for a non-binding talk.
Contact Casper Bo Jørgensen, Customer Relations Manager, at: +45 23 30 79 56 or write to cbj@hesehus.dk
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