Using Data for Consumer Enchantment
There is almost a consensus that massive data collection and analysis are quickly transforming and redefining all business models around the world, and only those who know how to properly use these resources will be able to survive and prosper. Now, the question is to what extent will each company be able to capture, interpret, and transform these increasingly larger volumes of information in intelligence powerhouses to improve internal processes and revolutionize the relationship with their partners, suppliers, and consumers?
This is a specially challenging and encouraging scenario for Lojas Renner S.A. We are the largest omnichannel fashion and lifestyle retailer in Brazil, in a segment where behaviors and consumption habits change day by day, and we work nonstop to anticipate and exceed our customers’ expectations. We call this purpose “enchantment” – delight, and, due to that, we are a data-driven company since we use data as allies in our journey to constantly transform and improve the consumers’ purchase experience.
One of the main technologies that enable companies to pursue this goal is radio-frequency identification (RFID). In retail, it allows for the development of innovative solutions to integrate physical and digital channels, to track the movement of products in the stores, and to identify those that please customers the most, besides reducing ruptures and increasing stock accuracy, improving sales predictions, product distribution and reposition, speeding up checkout and deliveries, and avoiding problems in the supply chain.
Technology is also fundamental to risk areas, such as auditing, compliance, and loss prevention. In them, the massive use of data broadens exponentially the productivity and analytical capacity of the companies to act with intelligence, proactivity, speed, and maximum efficiency in the prevention of process flaws and shrinkage, for example.
This is what we are doing at Lojas Renner. At the end of 2021, after three years of working in partnership with Sensormatic, part of the Johnson Controls group, the company finished the implementation of an innovative system for large fashion retail, which was recognized as one of the best in the world by the RFID Journal Awards. It is a solution that uses a single tag with the functions of radio-frequency identification and anti-theft safety, applied on 100 percent of the products sold in our over 400 stores of the Renner and Ashua brands.
This means over 500 million pieces tagged until now, just as around 4 million readings per day and a gigantic volume of collected data, which enables the permanent evolution of the efficiency of our online and offline operations. For example, with the RFID technology, physical sales points can act as small distribution centers in support of e-commerce and doing so with agility and economy, since it enables the real-time localization of purchased products to answer customers faster based on the closest location, be it for delivery or pickup in stores.
Compared to 2019, when the implementation of the system was initiated, RFID technology has also reduced by 87 percent stock rupture level, which indicates how many products are stocked in the stores but not exposed in sales areas. This was possible due to the automatic reposition warnings sent to the “Bluebird”, mobile data collectors used by our teams. Besides that, it is important to highlight the easiness to make inventories at any moment and in a few minutes, instead of annual or monthly surveys.
Compared to 2019, when the implementation of the system was initiated, RFID technology has also reduced by 87 percent stock rupture level, which indicates how many products are stocked in the stores but not exposed in sales areas
In the same period, there was a 64 percent increase in the accuracy of stocks, an indicator that represents the compatibility between the physical number of stored products and the volume registered in the database. This is key information for the omnichannel operation since it allows the integrated management of stocks to serve customers at physical sales points and on e-commerce.
Another observed improvement lies in the bigger capacity of identifying which products please customers the most in each store since it is now possible to track all products taken to the fitting room and to know whether they were effectively bought. This improves sales predictions, ensures a stronger assertiveness in the collections, and reduces the need to reprice products. Besides that, consumers gain more safety and agility at checkouts with the registration of all pieces in a single reading, simultaneous to the deactivation of anti-theft alarms.
Our manufacturing suppliers also benefit from it. Since they are the ones who attach RFID tags, they can use the system to improve their internal controls on order production and shipping. Therefore, they reduce the need for returns due to mistakes in the counting or selection of models, colors, or sizes of the ordered pieces.
Lojas Renner S.A. is a company with a 57-year history, around 25,000 collaborators, and over 600 stores in Brazil, Argentina, and Uruguay, besides Renner brands such as Youcom, a young fashion brand, and Camicado, the largest Brazilian retailer in the home and decor segment. It also controls Realize CFI, a digital financial company; Repassa, an online platform for the resale of used clothing, footwear, and accessories; Uello, an express delivery Logitech; and RX Ventures, an investment fund for startups focused on new retail solutions.
This set of operations composes what we call the “fashion and lifestyle ecosystem”, which has innovation culture as its fundamental pillar to develop people, technologies, products, and services and, at the end of the day, as mentioned at the beginning of this article, “delight” our consumers in all relationship channels and moments of interaction with our businesses.