WWD Mentions First Insight | Holiday Season Blind Spots Revealed in First Insight Report
Retailers and brands face significant challenges as they gear up for the upcoming holiday shopping season, according to a new report by First Insight Inc., the predictive analytics and VoC solution provider.
The report, titled “Retailers’ Blind Spot for Holiday 2024,” polled retail executives and concluded that retailers and brands need to integrate predictive analytics with consumer insights to optimize pricing, promotions and marketing strategies in order to navigate these challenges.
The report spotlights several key concerns identified by retailers, including promotional effectiveness where retailers “are unsure if their promotional strategies will be too reactive rather than strategic,” authors of the report said, adding that inventory management is also a concern. “There is significant worry about having stocked the right merchandise and in sufficient quantities.”
Other challenges include customer alignment where retailers are not confident that their planned assortments will resonate with target consumers. The survey revealed that more than half (53 percent) of those polled said they use the previous seasons’ sales histories while 49 percent said they use trend services and reports and 42 percent said they rely on customer comments and reviews from their websites.
The report also found that retailers are primarily relying on backward-looking data or third-party sources for insights, with more than half using previous seasons’ sales history and trend reports. Less emphasis is placed on real-time VoC data, which can provide valuable insights into current customer preferences.
For the upcoming holiday shopping season, external pressures are severe and are out of the control of retail executives. “Retailers find themselves at the mercy of economic forces and cultural whims as holiday 2024 approaches,” the report stated. “The consequences of inflation continue, threatening to further drive-up prices of essentials like gasoline and groceries. This financial pressure on consumers feels like an invisible hand, shaping shopping behaviors beyond retailers’ grasp.”
There are other challenges as well. “Simultaneously, the unpredictable nature of social media-driven trends is continuing to keep executives on edge, as a single viral TikTok video could make or break a product’s success overnight,” the report’s authors said.
“With rising inflation costs, retailers have much to worry about, especially whether the products they bought will be what consumers are willing to spend their money on,” said Greg Petro, chief executive officer of First Insight. “This makes it imperative for retailers to ensure their offerings align with consumer expectations.”
The report noted that the “powerful combination of predictive analytics and Voice of the Customer data can’t prophesy the next TikTok sensation, [it] can offer something equally valuable — a deep dive into consumer sentiment. By understanding where shoppers feel the financial squeeze most acutely, retailers can fine-tune their pricing strategies and craft promotions that truly resonate.”
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