IBM Unveils Advanced Analytics Portfolio to Help Retailers Better Target, Understand and Serve Customers

New “Quick Start” Portfolio of Solutions to Boost Customer Loyalty and Advocacy



NEW YORK, NY .- NRF Annual Convention & EXPO 2009 -- IBM (NYSE:IBM) today announced the IBM Retail Performance Analytics (RPA), a “quick start” portfolio of solutions designed to enable retailers to analyze and apply data to business processes to help them take costs out of their businesses and drive revenue.

IBM also today launched a dedicated Retail Performance Analytics Services practice with leaders in Americas, Europe, and Asia Pacific. This team will focus on delivering an integrated portfolio of solutions to address the full spectrum of retailing challenges including customer loyalty, price optimization, supply chain optimization, vendor performance, store planning, promotion management, financial performance management and more. IBM’s new services will allow organizations to leverage data across various business processes in a meaningful way.

The new comprehensive approach, which addresses the continuum of customer, merchandizing, supply chain, financial, and total store analytics, will help retailers coordinate planning and measurement across the chain so they can grow revenue, increase market share and forge better connections with customers. By giving retailers a single-view of critical customer, financial product, vendor data and more, retailers will be better positioned to respond to changing customer and business needs. RPA combines the IBM Cognos portfolio of business intelligence and performance management software with deep industry consulting and systems integration expertise. Retailers can access valuable accelerators and tools that enable retail-specific data modeling, business performance analysis, what-if forecasting, and key performance indicators (KPI) metrics management.

In today’s store environments, retailers are focused on driving operational efficiencies and cutting costs while vying for loyal customers who will be “Advocates” for their brand. IBM’s Institute for Business Value survey of 30,000 US consumers found that consumers are feeling stress from uncertain times and relying on retailers they trust -- contributing to the nearly double advocacy increase year-over-year. IBM’s new RPA solution is designed to deliver data on customized customer preferences so that retailers better “know their customer.”

“The current economic environment is driving the growth and demand of effective business intelligence and performance management solutions,” said Fred Balboni, Global Retail Industry Leader and Partner, IBM Global Business Services. “Retailers who leverage the current situation to advance their analytical capabilities will not only weather the current crisis better but they will also be positioned for a strong competitive advantage in the future.”

The Next Evolution of Retail Business Intelligence
IBM’s Retail Performance Analytics is a quick-start portfolio solution that addresses complex information-based business problems across the enterprise. It combines hardware, infrastructure, software and services to help retailers plan, manage, and optimize their businesses.

The new Retail Performance Analytics Portfolio contains the following new features:

* Accelerators and templates give retailers a head start in performance management -- in as little as 90-120 days -- so retailers can better forecast demand and assortments based on product flow, movement and demographic make-up of the surrounding market
* Store management access to key performance metrics that can head off business issues, such as out of stock, before end of day
* Easy to use toolsets that encourage multidimensional analysis for more targeted promotions
* Dashboards that provide a platform of ease of use across the enterprise from all channels and devices
* Ability to provide information to merchants, executives, store associates and vendors in real time

The Growing Importance of Advocacy
IBM’s survey of 30,000 US consumers which found that across multiple retail segments, 38 percent of respondents are now Advocates, compared to only 21 percent last year. The study, titled “Shopper Advocacy: Building Consumer Trust in the New Economic Environment,” provides an in-depth analysis of what makes consumers loyal and the specific financial benefits that loyalty delivers for retailers in tighter economic times.

The study surveyed consumers about retailers in the grocery, large-format apparel, mall-based specialty apparel, drugstore and online retailer segments. The survey revealed that consumers under stress from economic conditions are relying on retailers they trust, leading to two attractive and valuable segments: Advocates to existing retailers and “Shifters,” a class of consumers who are known for moving their purchases and seeking new relationships with new retailers. Retailers that execute on the requisite strategies to attract and retain these addressable markets will be positioned to emerge as winners.

Other Key Findings include:

* Two-thirds of consumers surveyed said they are postponing purchases or buying fewer items overall, while 60 percent of consumers indicated they are more often shopping for products on sale and using coupons more often.
* 30 percent of consumers are shifting purchases to new retailers, representing an attractive segment of shoppers. Shifters also spend 32 percent more per trip and 37 percent more per month than those consumers who do not shift.
* The dramatic growth of Advocates serves as a bright spot for retailers, as advocacy rates have nearly doubled from year to year (2007-2008). Advocates are customers who remain loyal to their primary retailers and recommend their preferred retailers to friends and family. 31 percent of Advocates increased spend with their primary retailer within the past year.