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Amazon and Sears, Tales of Two Retailers

My how time flies. In my 2012 post I held some glimmer of hope that Sears would leverage analytics and refocus its resources as it faced store closings.

On a sunny Sunday in 2017, I am writing and reflecting on the lost hope for Sears, a victim not just of a shift in retailing but of a dire future it created for itself.

Business experts have been weighing in on Sears’ announcement that it may face bankruptcy. The news comes as retailers struggle with the consumer interest in online shopping.

Sears’ current woes are a stark contrast to Amazon, which has achieved success with scaling analytics, machine learning, and cloud service development into services and strategic partners. Amazon’s evolution sounds like an ironic modern day retelling of Sears’ evolution beyond its mail order catalog. Sears started with mail order to serve one-stop shopping for consumers’ household needs, just like Amazon’s start with books. Sears added stores in response to the suburban sprawl of the 1950s and 1960s, just like Amazon added products to address the growing consumer searches online. Amazon now has choices for specific tastes in a way that no sales catalog or large department store can match easily.

The losses Sears racked up took years to mount. Yet why didn’t Sears turn things around?

Part of the issue lies in Sears not fully integrating an analytics framework to its strategy. Outsourcing analytics services, as I described in a later post covering the creation of MetaScale, was a good chess move for Sears. But chess is not won with just one move or two. The next move for Sears was seeking retail-by-mobile, followed by finding better ways to integrate third party data into its own operations. Right now more and more retailers are using third party data aggregation providers for understanding demographic trends and for establishing advanced analytic models based on the data.

It’s not just clothing retailers experimenting with mobile. Business Insider reported a Starbucks announcement of a dedicated mobile order and pay-only store at its Seattle headquarters, an experiment in eliminating lines at its stores.

  • By Pierre DeBois, founder of Zimana, small business analytics consultants
  • Read the source article at informationweek.com.

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