Interviews, insight & analysis on digital media & marketing

Data silos among internal teams leading to missed opportunities for retailers

Data silos between commercial and marketing teams are leading to missed opportunities for retailers according to research by product performance management (PPM) platform ROI Hunter.

The survey reveals nearly a third (32%) of retail marketers are still basing their advertising decisions on guesswork or gut feeling, with 46% of ads run, on average, failing to deliver the results needed.

The need for guesswork likely stems from the fact that many retailers lack the full picture of how their products are performing compared to their marketing efforts. Despite most retail marketers saying they deploy data-driven ad strategies, only 36% say they understand which of their products have the highest and lowest margins, only 32% know which products are their most profitable, and over a quarter (29%) admit to not knowing their best-selling products.

Nearly a fifth (17%) also say poor collaboration between commercial and marketing is a top challenge and 55% say they struggle to access data because it is separated across the company. This suggests that data is siloed between departments, with marketing and commercial disconnected, limiting campaign opportunities.

The problem is significantly higher among fashion retailers, with nearly half (45%) of fashion retail marketers admitting promotion decisions are based on a guess or gut feeling. Misalignment between departments is also more prominent, with 29% citing poor collaboration between commercial and marketing as a top challenge and 61% admitting to struggling to access data.

Karel Schindler, CEO at ROI Hunter, said: “There’s a clear misalignment between marketing and commercial teams among retailers. In the race to grab shoppers’ attention, marketers are rushing out campaigns without full visibility into product performance. Retail leaders need to take steps to eradicate silos across departments and enable shared access to product-level data so both departments can work together to promote the items that will perform best for their goals.”

Misalignment among retail departments is not just being felt by retailers, but by shoppers too. Over two-thirds (67%) of 2,015 consumers surveyed as part of the research say they have been served digital ads for out-of-stock items, and 70% for products with low availability. A fifth of shoppers say this happens often, suggesting a large proportion of retailers are spending their marketing budget promoting out-of-stock or low-stock items.

Product availability is also named by retail marketers as the second biggest reason why ads are perceived to underperform, reinforcing the disconnect.

To learn more, download the full report, The Retail Advertising Effectiveness Report 2022, here.

Research

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