Getting smarter with each sale

Eastern Mountain Sports, an outdoor specialty retailer in the U.S., turned to business intelligence software to gain insight into the actions of individual shoppers and boost sales of high-profit items.

"Using the general dashboard, we identified a behavior with our Footwear Guru program where people [at one store] were selling a lot of custom footbeds," which are shoe inserts that sell for US$20 to US$40 per pair, says Richard Pedott, EMS's vice president of sourcing, planning and allocation. He called the store manager, who looked at the same information and determined what that store was doing to produce that result. That selling strategy was then moved out to rest of the stores.

"We had a 73 percent pickup on footwear accessories, and that is a high-margin business," says Pedott. "That's just one example of the many things that can happen with BI software."

About 18 months ago, EMS began using WebFocus BI software and iWay middleware from Information Builders in New York. IWay extracts point-of-sale data from EMS's AS/400-based legacy ERP software and other applications and loads it into a Microsoft SQL Server data mart.

EMS then uses WebFocus to create dashboards, which provide a common view of that data to more than 200 end users at the headquarters office and retail stores.

"EMS has more than 80 stores, with several disparate data sources, including legacy merchandising systems, financial systems and point-of-sale devices," says Keith Gile, an analyst at Forrester Research. "Accessing this wide array of data sources and delivering reports, analysis and information back out to the store management in an easy-to-use fashion were key."

Pedott says the ability to easily link these data sources was a leading factor in selecting WebFocus and made it possible to go from design to installation in 12 weeks. Another was ease of use. "If you can surf the Internet, you can use their tool," he says.

The biggest benefit, according to Pedott, is that with WebFocus, everyone from the CEO to the store managers gets a common view of the information, which they can then use to identify locally successful sales and operations activities to implement throughout the company.

"With business intelligence software, I can discover what products customers purchase together and with what frequency," says Pedott. "This assists in determining product placement on the floor, creating strategic promotions and deciding what items to include in our shop on the Web."

His next step will be to expand the BI system out into the supply chain. "BI can become a cheap way to do collaboration with suppliers and other B2B partners without requiring them to make an investment," Pedott says. With WebFocus, he can create a mini version of the dashboard and e-mail it out as a Zip file. The hoped-for result is to have as many people as possible actively involved in the company's success.

"If it is done well, BI provides focus and gets every brain into the game," Pedott says. "It dramatically increases the number of ideas to grow the business."

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