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Tuesday, 25 August 2009 05:30

CRM and BI take aim at coalface retailers

Australian retailers are starting to push CRM and business intelligence tools out to the coalface, providing store managers with unprecedented levels of information about both their customers and the store’s performance.

Both Super Cheap Auto Group and Gloria Jean’s Coffees are exploring how to make more information available to their in-store managers over the next 12 months. According to Dr Bruce McCabe, director of technology innovation at KPMG; “When you push it out to the coalface you can set up feedback loops,” which he explained “combine human intelligence and silicon and improve both through an iterative process.”

“One of the great opportunities in business intelligence is to increase the footprint and make intelligence available to the people who can act on it, not just the (executive) managers,” he said.

Karin Hattingh is the divisional controller for Gloria Jean’s Coffees in Australia which is installing IBM Cognos TM1 to provide enhanced reporting for the business. “One of the aims for the future is to do franchise partner analysis and benchmarking,” according to Hattingh, who hopes to have a system ready by Christmas.

“If they know that other franchisees are returning 18 per cent profit, compared with their 10 per cent,” she said, store managers may be in a position to, for example, tackle their costs of goods. Analysis may show their wastage or salary costs are higher than comparable outlets allowing store managers to make changes to improve performance.

“When you drill down to that level you might find that some of the franchise partners never use casuals for more than 20 hours a week, and if you pay less than $400 a week then you don’t have to make superannuation contributions.” Having more granular store level information would allow franchise partners to more effectively manage their businesses.

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Super Cheap Auto Group owns a series of brands in Australia, running a total of about 350 stores. In 2002 the company decided to embrace SAP tools for enterprise management and is now implementing CRM Professional and Campaign Management. Although the initial focus has been producing reports for executives, CIO Wayne McMahon said that the group was this year looking at how to make more information available at the store level.

“They could know if they (customers) have got a (loyalty) club membership, their demographic, age, and what products people buy. For example in a Goldcross Cycles (store) if it’s a first bicycle then they are likely to want to buy a kit as well.”

McMahon explained; “In our business it’s about enabling decision makers,” and that the “longer term vision is about potentially rolling reports into stores.”

But having access to information just for the sake of it won’t benefit anyone – the type of information provided, and the amount needs to be carefully thought through. As Dr McCabe notes; “An individual in a Super Cheap might be disconcerted if they were greeted by name. But managers could use the system to suggest the McDonald’s upsell. If they buy a socket set, they might want a ratchet as well.

“There are lots of little things you can do when you push that intelligence to the store level.”

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