DEVELOPING

YOUR DATA ASSET

Accelerating your data journey to drive growth
By Jason Nathan
Unlike some other industries, Retailers are blessed with frequent
transactional data and ample opportunities to enhance that
data through mechanics such as loyalty programs. However,
the volume, variety and complexity of data sources available
to retailers are not necessarily translating into value, as when
consulting with retailers around the world, I hear the same
issues surface again and again:

“I don’t know what to do with all my data”

“What should I do to get best value from my data?”

“How can I ensure I’m using my data to drive growth?”

Clever use of customer data can provide a distinct competitive

advantage, and elevate data-driven retailers above their
competitors, but developing your data asset and getting
maximum value from it requires not just investment, but a
commitment to organisational change. This paper looks at what
retailers need to consider when starting on their data journey.

HISTORICAL CONTEXT – WHERE WE ARE IN THE

DATA RETAIL JOURNEY
Before we look at assessing data capability, it’s important to understand the
historical impact disruptions in retail data have had on modern retailing, and how
predicted future changes may play out for retailing businesses. Disruptions in
the narrative of retail data have often related to a technological or logistical sea
change. A good example: the introduction of self-service shopping, first in the US
in the 1950s and then in Europe in the 1960s.

Here are three examples of these data-driven changes and what they enabled:

ASIA
EPOS: the electronic point-of-
sale systems that allow data to
be captured for the basket being
purchased at SKU level.
Played a key role in the development of category
management as a retailing discipline and created
a new paradigm for the relationship between retail
and suppliers.

Loyalty programs: with which customers Enabled retailers to understand who is buying
self-identify in exchange for rewards, their products over time, creating insights into
and which allow baskets to be tied to lapsers, repeat purchase frequencies, and spend
individuals over time. switching. Facilitating personalization.

eCommerce: online shopping that allows Created new data: customers’ decision sets.
customers to purchase products through Enabled by clickstream data, categories can
websites or apps that generate data about now understand that when Customer Smith buys
the entire path to purchase online. Product C, they also looked at Products A and B.

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ASSESSING YOUR DATA CAPABILITY
– WHERE TO START
In order to know what you need to do to develop your data asset, you first
must establish how ‘data-fit’ your business is. We use this model to give
clients a method to evaluate and understand where they are on the data
journey. Understanding where your business sits on the data maturity
curve, will help you determine where to start.

Let’s look at each of these stages in more detail and some typical
investments required to progress from level to level:

LEVEL
5
LEVEL DATA
4 PARTNERSHIPS
Enriched data
used to drive a
LEVEL ENRICHED self-sustaining
3 DATA commercial
relationship
Data joined
ecosystem. Both
LEVEL JOINED
and enriched
enables the

2
(segmentations
consumption
DATA scoring)
of new data
continuously;
Data joined (i.e. social) and
enrichment used
using Customer,
LEVEL ADVANCED for reporting,
monetisation
Product, Store
1
of existing
analytics and
DATA keys to allow for
activation
organisation data
deeper analysis
Capturing and
of behaviours and
utilising data
ESSENTIAL beyond Core
performance
DATA management
(i.e. Customer,
Core Sales, Product
digital and
and Stores data
competitor data)
captured and used
for reporting

3
 LEVEL ESSENTIAL DATA
1
Any modern retailer should have this – sales data, staff data, basic supply chain data. It is likely to be
used for financial reporting or managing client relationships.

LEVEL ADVANCED DATA

2
Retailers at this level typically capture a whole range of data which has latent value, but are only really
using it for certain processes (e.g. RFID to manage stock control, Loyalty Card data to operate the loyalty
programme). Often it resides in an operational silo and retailers are not aware of how to best combine it.
An example of developing your data to drive greater value would be to apply that data to different areas
of the business, e.g. use loyalty card data to determine merchandising or ranging, or using customer
service centre data to vary media content. dunnhumby can help to identify the value, stewardship,
technical implementation and opportunities combining these datasets can bring about.

LEVEL JOINED DATA

3
This is where some retailers start to join the data meaningfully. It can be joined around customers,
around stores, around time dimensions, around products, but requires some effort
to put this data together for a specific end in mind. The principal of a “data lake” (storage unit)
is set to replace the Enterprise Data Warehouse as a primary mechanic with which to do that. Good
companies know what data they have and what they plan to generate.
To create a single customer view, retailers need to establish:
• What data they need to systematically join?
• Do they have the right identifiers to join that data?
We help our clients progress from level 2 to level 3, sometimes with loyalty card data, and have helped
clients launch loyalty programs for the purpose of data enrichment.

LEVEL ENRICHED DATA

4
To progress from Level 3 to Level 4, is really about continuously enriching your data, for example,
creating segmentations that add descriptive dimensions such as ‘propensity to buy on promotion’ or
‘likelihood to have children’ and enable embedding of customer metrics into your business. Great
retailers add scores to products and customers for purposes of targeting, identifying propensity to lapse,
price sensitivity, etc.

LEVEL DATA PARTNERSHIPS

5
Retailers at this level recognise that there are data assets in the public domain which they
don’t control, but can use to better understand and/or activate customers (e.g. social media
data, wearables data). They have a clear view on the benefits of creating partnerships with providers and
organisations that help them understand open data. We help them plan and execute an ecosystem of
partnerships, drawing on experience from multiple geographies with differing challenges.

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WHAT DATA SHOULD I
USE TO BUILD MY ASSET?
Having established what current level of data maturity your business
operates at, the starting point now for any conversation around data can
be an understanding of what at a high level you want to achieve and then
creating a clear model for how your customers interact with you on their
shopping trip.

Your brand strategy should clearly lay out what you want your business to
be and what it should stand for in the eyes of your customers. Each retailer EXAMPLES OF DATA-TYPES
strives to have a USP – no one can be the best at everything – so you will WHICH SUPPORT DIFFERENT
have determined what you want to be known for. Why do your customers RETAIL STRATEGIES:
want to shop with you? Best quality? Best customer service? Best in-store
experience? The thing you want to be brilliant at, you will need to have the
most rich data to support your strategy to deliver that. Improve the instore experience

• Footfall map of your store

This model of the customer shopping journey helps retailers organise
• Customer transactional data
thinking around the data they are investing in, collecting, managing,
to inform Ranging
and presenting.
• Car parking utilization data
• Hygiene / temperature data
• Queue length time data

Best customer service

• KPIs for staffing levels

• Customer data which tells you
in real time when your best
customers are in-store (so you
can ensure your best staff on
the shop floor)
• Length of time to convert in-store

Never beaten on price

• Accurate price data

(including promotions)
• Competitor price data
• Substitutability propensity data

The model of the

Key questions to ask: which of those touchpoints generate data that you
customer shopping
own or could access through a 3rd party? Can you enrich any of those journey helps organise
touchpoints with additional data or technology which helps customers and
generates data, such as a mobile scanning app? your thinking around
What data do you currently have for each stage of the customer journey? which data sources you
Our recommendation would be to know a bit about each step, rather than
only knowing one thing.
should invest in.

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OWN – PROCURE – PARTNER
HOW TO GET THE DATA YOU NEED
So once you’ve worked out what data you need to source, you need to
decide if that is something you want to own, want to procure, or want
to source via a partner, e.g. do you want to own your own review data?
Do you want to own your own delivery data (e.g. knowing exactly what
happens at each stage of the delivery process)

Here are the benefits of owning vs procuring vs partnering:

OWNERSHIP
This provides control, but can create cost and regulatory overheads.

PARTNERSHIP
Can be brilliant but designing a sustainable incentive scheme for all partners is hard.

PROCUREMENT
This is the most flexible option but carries with it the challenge of avoiding ending up
in a heavily leveraged position.

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CONCLUSION
When looking to develop your data asset, you should ensure your business is
set up to do the following:

1 Explore use cases around data that is generated and kept.

2 Keep data that you are generating but not using, until you have
determined its potential use (within regulatory constraints of course).

3 Data you could be generating that you currently are not, e.g. what
do you want to know about your customers?

Contact us to learn more about how we can help you accelerate your
data journey to grow your business.

ABOUT THE AUTHOR

Jason Nathan is dunnhumby’s Global Managing Director for Data.
He leads our data consultancy and engineering practices, helping
clients drive growth by optimising their data assets through creation
and execution of cloud-based data strategies which put the customer
at the heart of decision making.

Learn more at
www.dunnhumby.com