11 May Why Retail Dashboards are Critical, but Not Enough in 2021
What are retail dashboards?
Retail dashboards display the state of a retailer’s business in a visual, at-a-glance format designed to help retailers track and improve key elements of retail performance.
With the help of dashboards, retail employees can make faster, better decisions that align with the retailer’s Key Performance Indicators (KPIs) to streamline business processes.
Dashboards are also often referred to as business intelligence software, data visualization tools, or analytics dashboards. Regardless of what they’re called in your business, they share the same ultimate goal; to give you up-to-date performance numbers for your most important KPIs.
Let’s look at how retailers use dashboards, why they improve business performance, and why leading retailers are replacing their traditional dashboards with forward-looking advanced analytics solutions.
Retail dashboards examples:
Retailers that successfully implement dashboards do not take a one size fits all approach. Instead, they create dashboards for every business function and every level of their organization.
Here are five commonly-used retail dashboards examples:
Store performance dashboards
Store performance dashboards give retail managers instant updates of metrics such as foot traffic, sales per employee, and attachment rates to help them supervise their store’s daily operations.
Promotion planning and optimization dashboards
Using promotion-specific dashboards to monitor metrics such as in-stock percentages and promotion uplifts lets planners optimize promotion performance.
By highlighting conversion rates, shopping cart abandonment rates, top-10 performing products, and other e-commerce metrics, dashboards let retailers react quickly to changes in their online businesses.
Customer segmentation dashboards
R&D managers, sales managers, marketing managers use customer-centric dashboards to monitor customer demographics, customer lifetime value, and flag changes in the shopping behaviour of key customer segments.
Inventory management dashboards
Inventory management dashboards flag out-of-stocks, changing turnover ratios, shipping delays and other critical supply chain metrics to improve inventory KPIs.
Why retail KPI dashboards are critical
The retail dashboard examples above demonstrate a focus on key performance indicators (KPIs).
Retail KPI dashboards prevent retailers from losing sight of their business goals by streamlining their processes and are therefore crucial in a number of ways.
Prioritizing a sea of retail data
Effective dashboards consolidate data from multiple sources to give store managers, inventory analysts, buyers, and other employees the specific information they need to track their performance and make better decisions.
Accelerating effective decision making
A retail dashboard provides clear and accessible visual representations of complicated mathematical computations. Information is provided through graphs, charts, colour coding, and other data visualization techniques.
This means that a user can view and understand the state of their business at a glance, and immediately move on to decision making.
Improving business performance
Dashboards guide successful retailers.
Researchers at the Wharton School and the Harvard Business School recently studied 1,000 e-commerce retailers to understand how descriptive dashboards impact sales. They found the retailers that adopted dashboards increased their revenues by 13-20%.
The study’s authors cautioned, however, that the impacts from these descriptive dashboards were indirect and that simply creating a dashboard is not enough.
Successful retailers used the dashboards to actively assess how other decisions affected business performance.
Dashboards need to be personalized and configurable
Generic dashboards are particularly ineffective ways to manage retail performance.
Knowing the latest company-wide numbers like gross margin return on investment (GMROI) may be of little use to most employees deciding the next steps on their task list.
A dashboard retail store managers use will focus on inventory stocks and promotional sales uplifts at their location, while a director’s dashboard will be more concerned with the overall performance of their department on a monthly or quarterly basis.
Retail executive dashboards will focus on the entire business, and at even longer-term timelines — isolating high-level KPIs like GMROI.
Whatever the user’s role, however, they need a dashboard that easily adjusts to changing business priorities. Requesting a new development project with each change is not sustainable.
Dashboards need to be unified across the business
A retailer that has incorporated a variety of dashboards to support users of differing business levels has made a step in the right direction. However, they may find themselves tripping over a new problem – data fragmentation.
Users will react to the information that is provided by the configured KPIs and if the various dashboards are not integrated throughout the business, users will experience a breakdown in visibility.
For instance, an inventory analyst’s dashboard may not synchronize with a marketing dashboard. The inventory analyst would get a warning that a SKU is overstocked without seeing a corresponding reminder that the SKU is part of an upcoming promotion.
Fragmented dashboards present only part of the picture, so when an issue requires investigation across multiple business functions users waste time simply consolidating the data they need before they can even begin to investigate the issue.
A truly effective dashboard will only show user-specific KPIs, but the analytics in the backend must fully account for data across the entire business.
Why are retail dashboards not enough to be successful?
Business intelligence tools generate better insights than traditional databases and spreadsheets. However, no matter how sophisticated the systems powering dashboards may be, they suffer from an inherent weakness: they are descriptive.
Retail dashboards develop reports based on past performance. Dashboards can tell you that something went wrong, but these tools do not tell you why and cannot give you actionable guidance into making better decisions in the future.
It remains up to the analysts to glean actionable insights at the significant cost, time, and resources.
Advanced analytics make your business more proactive
Advanced analytics vendors like Retalon provide AI-driven platforms that go beyond the typical reporting of retail dashboards by providing proactive recommendations for profitable actions in your business.
Consider a traditional inventory management dashboard. It will report on a SKU’s sales history, its current inventory levels, any out-of-stock conditions, and other historical data. Unfortunately, an analyst still has to investigate the stock-outs, decide how much product to re-order, and how best to get the product there, or price the product.
Retalon’s advanced analytics takes care of all of this.
- The system recommends store-specific replenishment quantities based on anticipated demand.
- Factoring in shipping costs and lead times, it offers the most profitable fulfillment option.
- The system can also recommend promotions, prices, and more.
- The system automatically accounts for your preferences, and constraints with smart business rules.
Rather than wasting your time working through small-scale issues which can be automated intelligently, your analysts can focus on higher-level projects that build a long-term business.
Retalon’s advanced retail analytics solution integrates data from your business end-to-end improving operational efficiency and KPI performance while helping you develop a more proactive retail business.
Discover these stories about how retailers are using advanced analytics in their business. Or contact Retalon for a demonstration of advanced analytics in action using data from your retail operations.