There has been a dramatic shift in the past 20 years in the way retailers and manufacturers attempt to influence the marketplace. Manufacturers and retailers now have massive amounts of consumer data at their fingertips, moving their relationship from competitive to collaborative. The future innovators of business will be the ones who can best garner insights from this data stream and effectively share them with stakeholders.
Downstream sales and insight data presents an intriguing dilemma for consumer products companies. Instead of using targeted data to generate actionable insights, organizations are drowning in an ocean of conflicting information. Traditional account and store-level sales data are now being integrated with new data sources, such as loyalty, coupon, survey, and social media insights. Understanding how to leverage this data has gained increased visibility among executives as the effort to manage it often overshadows the benefit. One thing is certain: the evolving consumer landscape requires downstream data effectiveness measured by how well an organization can identify and interpret insights to their partners.
Downstream data should be leveraged across multiple business functions and represents a critical component that connects supply and demand organizations. The innovators in this area are driving strategic decisions with these rich insights; but it is far more common for an organization to be wrestling with basic elements, such as which data to even evaluate, let alone using the insights and information to support strategic discussions. While investment continues to increase, most companies fail to deliver the anticipated benefits, unsure of their final objective.
A ‘data insights maturity’ scale with the following attributes helps illustrate advancement from ‘uncertainty’ (collector) to ‘innovator’ (collaborator):
At this stage, an organization is still learning which types of data they want to include in their analysis and how to manage the infrastructure. Typical decisions include which customers to focus on, and what types of data to purchase. Many organizations never emerge from the collector phase and typically view downstream data as merely a cost of doing business.
At this stage, a company will have sound practices for collecting and storing data, along with basic reporting, but will lack the ability to interpret and develop insights. During this stage, a company will start to look at the technologies that are available to analyze the data and start to consider how to share across functional areas. These companies typically have ongoing pilot efforts that individually are demonstrating success. INSIGHTS Downstream Data Effectiveness
As an organization becomes more comfortable with data sets and technology, the focus turns to how to harness actionable insights. The major driver in this phase is to find ways to communicate this information to internal and external stakeholders so that better decisions can be made. Most decisions focus on how to better share the data and how to incorporate emerging technologies, such as social media insights.
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