Retailers failing to deal with accumulating customer data, claims SAP


UK retailers are failing to deal with the accumulating amounts of customer data they collect, according to a new report from SAP. 

The study, which examines plans for technology investment in 2012 among 100 retail companies, found data is swamping the industry, with over half of the respondents admitting to having access to more data than they can actually act upon.

In addition, 88% of companies surveyed claimed to experience problems gaining valuable insights from customer data.

According to SAP, UK retailers are at a crossroads and face a year of critical business decisions, which will have long term impact on future success. 

Technology will be crucial but retailers are compromising their IT investments for 2012 and failing to balance short-term customer facing investment with long-term, back office spend, said SAP. 

In particular, retailers are failing to harness new technology to analyse and act upon customer data, said SAP.

Key findings of the report include:

  • Over three quarters of retailers have seen customers become more responsive to offers, 75% have also reported a rise in demand for a more personalised service
  • Two thirds of retailers are under pressure to provide IT innovation to improve customer retention and loyalty
  • Just under half of retailers surveyed admit to finding it difficult to turn customer data into insight
  • Seven out of 10 retail companies are more likely to invest in customer facing technology than back office during 2012
  •  Retailers are challenged by balancing the need to improve profitability (76%), reduce costs (65%) as strategic priorities

Chris Osborne, retail industry principal SAP UK and Ireland, said: “The real choice to be made isn’t between front of house or back-office; rather it’s about the business as a whole. What retailers should be striving to achieve is consistency and transparency across their business. Retailers need to get to grips with data now in order to be able to cope with the deluge of information that is available, both on their business and their customers.

“The retail industry recognises the need to analyse data while improving customer service, but how to achieve that in harmony is clearly where there’s cause for confusion. By investing more heavily in customer facing technology, companies are opening themselves up even wider to receive more data, which they are already struggling to utilise effectively.”