Solita has released its Retail Barometer for September 2024, providing in-depth insights into the current outlook of the retail industry and its ongoing efforts to leverage data as a key driver of revenue growth. Conducted bi-annually, the study gathers insights from key retail industry stakeholders across Europe, exploring challenges, opportunities, and new strategies in an evolving market.
Retail industry facing economic headwinds in 2024
As the global economic climate continues to impact businesses, Solita’s report reveals that the majority of European retailers rate the state of the industry as “weak” or “average” for the first half of 2024. Rising operational costs, driven by inflation and geopolitical instability, remain significant concerns, with 70% of respondents pointing to these as major challenges.
Data monetisation: A powerful driver of retail growth
With operational costs surging, data-driven strategies are becoming central to retailers’ plans for recovery and growth. According to the Solita Retail Barometer, 85% of the respondents either have or plan to implement a consumer data strategy. The report highlights that data is viewed as a critical tool for understanding consumer needs, optimising operations, and driving profitability.
“Retailers are usually quite good at their core business processes like merchandising, logistics, store operations, e-commerce, and marketing – if you fail at one of these, you will soon be out of business. However, when it comes to ownership and processes for, say, definitions and data quality for customers and other key information objects, most classic retailers are at an early stage,” said Anders Hedfalk, Business Consultant and Industry Expert, Solita.
Barriers to success: Challenges in data monetisation
While many retailers recognise the potential of data, challenges remain. The report identifies inadequate processes, outdated technology, and poor data quality as the primary barriers to data monetisation. Regulatory hurdles and financial constraints also pose significant challenges, preventing retailers from fully realising the value of their consumer data.
20% of retailers also cite company culture as a limiting factor, pointing to a need for more widespread adoption of data-driven decision-making across organisations.
“Despite the substantial potential for collecting more data, companies aren’t short on gigabytes. Their main problems in monetising data are the lack of appropriate processes, limited financial resources, and insufficient data quality. These are serious issues, but they also have relatively straightforward solutions: retailers need data management expertise that can be gained either by hiring the right specialists or investing in the support of external experts,” said Tomasz Woźniak, CEO, Future Mind, a Solita company.
Loyalty programs lead data monetisation efforts
Companies leverage consumer data for a variety of objectives. The primary goal is optimising marketing and sales efforts, selected by 90% of respondents. Generating reports and analyses comes in as the second most common use of data, with 80% of respondents prioritising this. Following closely behind is the goal of enhancing services and improving the customer experience, an area where 70% of the respondents are actively focusing.
When it comes to data monetisation methods among European retailers, loyalty programs have emerged as the leading approach used by the majority of respondents. Personalized offers, mobile apps, and direct communications are also key tools in retailers’ strategies to enhance customer engagement and gather valuable consumer insights.
Looking ahead: Investment in AI and analytics
While retailers are cautious about increasing IT investments in 2024, there is strong interest in AI, data management, and analytics. These areas are seen as crucial for staying competitive in a fast-changing market. Retailers are particularly focused on enhancing their ability to personalise customer experiences and improve operational efficiency through smarter data usage.
About the Solita Retail Barometer
The Solita Retail Barometer was conducted using the Computer-Assisted Web Interviewing (CAWI) method. Data was gathered from 20 key decision-makers across Denmark, Finland, Germany, Poland, and Sweden. All respondents represent retail companies with annual revenues exceeding 100 million EUR. The survey provides valuable insights into current retail trends and challenges, reflecting the perspectives of industry leaders actively shaping the sector.
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For more information
Anders Hedfalk, Business Consultant and Industry Expert, Solita, Sweden, [email protected], +46 706 05 10 16
Tomasz Woźniak , CEO, Future Mind, a Solita company, [email protected], +48 60 962 69 55
About Solita
Established in 1996, Solita is a technology, data, and design company dedicated to digital transformation. Empowering businesses and societies to reinvent themselves, the company focuses on advanced technology, data innovation, and human insight by offering strategic consulting, service design, software development, AI & analytics, and managed cloud services. A vibrant community of over 2,100 forward-thinkers, Solita operates in nine countries: Finland, Sweden, Denmark, Norway, Estonia, Belgium, Poland, Switzerland, and Germany.
About Future Mind
Future Mind, a member of the Solita Group, is an award-winning Digital Advisory & Delivery company that has been creating innovative digital products for 15 years. The Future Mind team consists of more than 200 professionals, including business and technology consultants, analysts, developers, and UX & UI designers. Thanks to expert know-how and experience, the company supports leading brands in making strategic decisions, digital transformation management, and digital product development and maintenance. In its projects, the company combines the potential of mobile and backend technologies with a strong base of cloud, data and AI solutions. Future Mind guarantees the highest quality in every project by cooperating with specialised technology partners from around the world. The solutions created by Future Mind’s experts have received numerous industry awards, and the company’s dynamic growth has been recognised by magazines such as Forbes and Financial Times.
