Anyone working in retail knows that the industry has been pummeled by change over the last few years. The pandemic was a huge accelerator of trends, but even before COVID-19 was something we had heard of, consumer behavior, technology, and geopolitical changes like tariffs were forcing retailers to be much more responsive and agile. And disruption is not going away anytime soon. If anything – as the ongoing supply chain mess shows – these challenges are going to keep coming more frequently and with much more intensity.
Clearly then, retailers need to embrace agility across the organization to better sense and respond to changing consumer priorities and industry trends. To preempt and prepare for change, retailers need real-time and cross-functional insights that come from internal and external data sources. AlixPartners has recently partnered with Palantir Technologies with the express goal of making these capabilities available to our clients. Through this partnership, AlixPartners will combine Palantir’s leading platform for large-scale, machine-enabled decision-making with our expertise in value creation and helping companies transform at speed. Details of the partnership announcement can be found here.
Palantir’s AI-enabled decision support can be built upon AlixPartners’ Retail Workbench. More specifically for our retail clients, there are several solutions that can be tailored depending on the challenge, including:
- Improve localized assortment in the store with real-time visibility into customer demand and predictive insights into supply chain disruptions
- Enhance agility and dramatically reduce time needed to launch new products, resulting in fewer markdowns and lower capital needed to run the business
- Create hyper-personalization of products, services, and offers using customer behavior within and outside a retailer’s ecosystem
- Manage SKU level profitability by understanding the drivers of cost inflation and supply constraints offset by the pricing opportunity
- Improve a store’s omni-economic value and define the right balance of ecommerce and physical footprint for improving financial performance
- Find new avenues for revenue growth through product assortment, new customer targeting, or physical expansion
The combined AlixPartners-Palantir offering can help our retail clients drive true performance. For example, it can create a unified view of the omnichannel customer journey – from online browsing to app purchase to store return, measuring the true impact of specific promotions and markdowns at the SKU level. In another situation, it can utilize the power of AI and data science to forecast demand more precisely and granularly to guide inventory and staffing decisions or recommend the next best action at the individual customer level to drive trips or expand basket sizes.
Retail is flooded with data sources. However, most retailers still struggle to glean actionable insights from these rapidly burgeoning structured and unstructured datasets. Those that can get ahead of the curve will have a distinct competitive advantage in the years ahead. Winners in retail will be able to leverage the deep lakes of information at their disposal and effectively integrate data into everyday processes to make smart and monetizable decisions.