Making Store Lifecycle Management Strategic
It is hard believe that simply moving a location from one end of a strip center to another would increase sales by 50 percent, but that is exactly what happened to Dunkin’ Brands as reported in the Boston Globe. Dunkin’s experience is just one example of how real estate and store development is moving beyond the execution-focused functionality of traditional IWMS and SLM systems to one driven by location strategy, GIS and predictive analytics.
In hundreds of conversations with store development executives about the challenges they face and the best ways to solve them, what truly resonates with them is having the capability to set strategy and execute against it. And they want that relationship to be two-way. While strategy drives execution, lessons-learned from execution experience, and changing market conditions, will help inform their strategy going forward.
They are looking for framework to assess their portfolio, determine the best steps and build a capital plan from the bottom up – and the ability to manage that plan and assess its efficacy along the way. They want the visibility and flexibility to mitigate risk and change course if necessary before they have gone too far “down the path” or sunk too many resources into a specific direction.
Linking Strategy to Execution
Traditional store lifecycle management is failing these same executives because these solutions were developed to handle the execution side of the business and over time have become a commoditized product category. Innovation is incremental – measured in inches rather than miles. They also don’t address the key issues facing real estate and store development executives. One could argue that trying to make key store pipeline and portfolio decisions while relying on traditional, execution-focused products is similar to a body acting without a head; you may be able to move forward, but without a clear sense of purpose or direction.
And, it’s not just store lifecycle management. Standalone GIS and sales forecast point solutions lack the perspective of downstream store development execution and therefore cannot inform real estate strategy effectively. In essence, there’s no link from strategy to execution and back.
Pioneering the Way Forward
This is why our vision for the industry looks beyond point solutions and beyond execution. Our perspective and approach is fundamentally different and is driven by years of experience and expertise in the industry combined with the insight and know-how of the best data scientists and modelers. At the risk of seeming immodest, I can easily say that we are pioneers. Our team is comprised of key innovators in predictive analytics, GIS and IWMS/SLM spanning the last four decades.
We start with the premise that Intelligent Store Lifecycle Management is about having the intelligence and logic that enables you to build a plan and execute against it, as well as being able to adapt in real-time to changing conditions.
Let me give you a couple of examples.
Our customer survey process continually surveys who is shopping, where they are coming from and where they are going after, and the information gathered and analyzed may have a direct impact on defining trade areas. If the trade areas change, the analytic models adapt to reflect the change. This may in turn affect your mission critical decisions such as where to build a store, what type of store to build and the impact of remodels.
Going back to Dunkin’ Brands, it was having this logic that enabled them to make the decision to move their location. As their VP of Franchising, Grant Benson explained: “The application told us the demographics in this area had really shifted over time. People aren’t as likely to get out and have a cup of coffee in the morning here anymore. They’re getting it on the way to something else.” A change in their consumer profile had a definite impact on what type of location would yield the best sales results - Dunkin’ Brands has opened more than 1,000 locations using our models.
Strategic Store Lifecycle Management is the next wave in the evolution of Predictive Analytics, GIS and IWMS/SLM. Tango Analytics’ cloud-based Software-as-a-Service (SaaS) solution addresses the challenges store development executives and their teams face with traditional point solutions. Bringing together customer and location predictive analytics with purpose-built retail GIS and store development execution, our solution bridges the gap between thinking, knowing and acting. Simply put, we help our clients see and analyze all the available opportunities, pick the right sites and open them faster.
Read our white paper, which provides a deeper dive into the considerable benefits of Strategic Store Lifecycle Management.