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By Tony Agresta, senior director of marketing, Market 6
When suppliers and retailers discuss “collaboration,” what do they really mean? Is collaboration about coordinated planning or much more? A panel of experts at FMI Connect discussed this topic. As the session evolved, it became clear that some attributes of collaboration are obvious and others more subtle.
Let’s start with the primary business driver for collaboration – The Shopper. The shopper continues to expand her horizons as markets continue to provide options. Overall store capacity and formats continue to rise. Competitive options spring up in markets all the time. The digital path to purchase and direct store delivery represent growing channels. The fact is, shoppers are in control. This reminds me when “churn” in the mobile phone business became the primary driver for more effective promotions, bundled services and lower prices. Shopper buying power has and continues to be at an all-time high.
Usher in collaboration. The end goal is to delight the shopper but reaching collaboration nirvana is no easy task. In the first article of this series (FMI Connect’s Powerhouse Panel on Collaboration), I defined collaboration as “a process jointly shared by retailers and suppliers consisting of planning, budgeting, analysis, promotion and measurement.” Let’s expand on this idea.
For collaboration to work, a complex mix of events, data, people and systems needs to be synchronized into a customer-centric strategy. Visionary suppliers understand this idea and proactively deploy collaborative strategies to address fluid changes on the shopper side, changes that retailers attempt to anticipate and plan for.
What role does analytics play? Sustained growth in predictive analytics and descriptive analytics (data visualization, BI, dashboards) continues to be applied across most sectors. It is also fueling demand in supplier-retailer collaboration. By connecting to more and more data, analysts have the ability to discover patterns and anomalies previously hidden. In turn, they share insights with other members of their organizations. Decision-making is accelerated. Accuracy is heightened. Actions driven from the discovery-collaboration cycle emerge and are applied in a proactive way. Analytics is used in every step along the way from manufacturing through supply chain, distribution centers and retail, the end goal of which is a positive experience for the shopper.
The root of collaboration seems grounded in “connections.” Connections between people, data, processes and organizations drive collaboration. Without connected data, without connected technology allowing for improved planning, budgeting, category management and supply chain management, the promise of “customer-centricity” seems a distant dream. The customer continues to make decisions rapidly. Her buying options continuously expand and so must the rest of the ecosystem.