Last fall, Devon Wolfe and his colleagues at Pitney Bowes Business Insight (PBBI) foresaw a bleak holiday season, as others did. They took the next step, though, and tried to anticipate how to help retailers afterwards. “We knew that retailers would be looking for what to do in early 2009, that they’d want to know what’s going to happen next,” Wolfe told me in a recent phone call.
So the company created PBBI MarketPulse, a market analysis software tool that uses current macroeconomic data to predict retail store performance. MarketPulse reports can help retailers improve the operational efficiency of their store network by analyzing key economic indicators for specific markets or trade areas. Those indicators include population change, housing turnover, income growth, household wealth, and unemployment estimates, among others. (For more details, click here.)
“Our mission is to give people actionable answers,” said Wolfe, PBBI managing director of Americas strategy and predictive analytics for retail, restaurant, and real estate. “If retailers can be sharper on right-sizing their inventory with business intelligence, and they can move that gross margin by even a fraction of a percentage point, the potential gain across a retail chain is huge.”
Wolfe recalls trying to help retailers forecast during the 2000-01 economic slump, “but obviously it was nothing like this,” he said. (Click here for a related article on retail strategies during a difficult economy.) Until now, “there wasn’t this type of analysis to do because everybody was gung-ho with expansion. Now there’s a very intense need to study markets at a local level and really understand which markets make sense and which ones don’t.”
With retailers now beginning to place their holiday orders (click here for an article on 2009 holiday shopping orders), what does Wolfe think lies ahead? “It looks like things should continue to get worse throughout the rest of the year,” he told me.
Is it 2010 yet?