In Retail, Size Matters

As you try on a pair of new jeans at your favorite retailer, you soon discover what retailers have known for years:  size matters.

It’s fitting that at “Retail’s BIG Show,” hosted by the National Retail Federation (NRF) in New York, Jan. 16-17, a hot theme is size. As retailers examine the recent holiday shopping season, assessing the effectiveness of big markdowns, big sales and big spending, they’re also grappling with a rapidly changing industry, from mergers and acquisitions to the spread of super centers. Size matters.

Right product, right price, right time …
New technologies from SAS are helping retailers plan more effectively, better understand their customers and vendors, deliver the right offer at the right time via the right channel, and have the right merchandise for sale at the right price.

It is no longer enough to allocate merchandise based on past regional performance. Forward-thinking retailers like Kohl’s (see related story) now plan and allocate merchandise at the store level based on the size and color demanded by consumer shopping that store. Detailed analysis of customer and sales data using software from SAS reveals distinct differences between stores, even within the same region. Using these insights, they optimize merchandise assortments. So when you want a pair of size 8 black jeans, they’re available. Size truly does matter.

SAS highlighted its comprehensive retail intelligence offerings at the NRF conference, demonstrating its suite of retail intelligence solutions, including:

• Customer Relationship Management 
• Merchandise Intelligence
• Operational Intelligence 
• Performance Management 
  

These solutions turn data about customers, merchandise and operations into knowledge that in turn influences the most fundamental business decisions. They help retailers gain greater insights into daily operations, leading to decisions that affect their organization’s overall share performance.

Size optimization at Kohl’s
Highlights at NRF include a “Big Idea” session by SAS customer Jon Nordeen, Kohl’s executive vice president of merchandise planning and allocation. Kohl’s, with more than 700 stores in 41 states, is attracting new customers by providing fashion-focused merchandising, a better in-store experience, and a strong advertising campaign. Nordeen will discuss the role size optimization can play in improving customer experience while at the same time, strengthening merchandise performance. Kohl’s has turned to SAS as its technology partner for retail intelligence, including size and revenue optimization among other areas.

The SAS analytics platform used by Kohl’s for size and markdown optimization is part of SAS’ comprehensive, integrated suite of retail solutions that address the merchandising life cycle. The SAS suite includes financial planning, assortment planning, forecasting, revenue optimization, space planning, allocation, fulfillment and vendor collaboration.

Uncovering trends, identifying opportunities
Built on the SAS Enterprise Intelligence Platform, SAS solutions for retail help address complex challenges by combining advanced data integration, business intelligence (BI) and predictive analytics.

“With SAS Enterprise Intelligence Platform at the foundation of a retail intelligence framework, business solutions such as size optimization can be integrated throughout the merchandising life cycle,” says Lori Schafer, vice president of the global retail practice at SAS.

Through the platform’s data integration technology, including software for extraction, transformation and loading (ETL) and data quality, retailers can gather, organize and cleanse disparate data on their customers, finances or other operations. SAS’ powerful predictive analytics help distinguish what’s important from what isn’t, uncover patterns and trends, and identify opportunities. Finally, with traditional BI tools, the retailers can put the power of an enterprise intelligence platform – one that goes beyond BI and simple reports – in the hands of people throughout their organizations for better, timelier decisions.