April 30th, 2012 by Kelly Liyakasa

The first thing Scott Friesen does when we sit for an interview at SAS Global Forum 2012 is show me his watch – the corporate epitome of a “mile marker” for making it to your fifth birthday at the Minnesota headquarters of consumer electronic retailer Best Buy.

It appears a bittersweet reminder to the big box’s Senior Director of Analytics in the Consumer Insights unit, that times have, indeed, been difficult in the brick and mortar world – from the resignation of CEO Brian Dunn to a roller coaster in sales to the 50-store shutter (Friesen aptly reminds me that the chain is opening 100 smaller-scale models and I promised I’d report it.)

“It’s extremely dynamic,” he reiterates of the retail conglomerate’s culture, “and, I think appropriately paranoid in a business where that paranoia can actually be a healthy cultural attribute to keep you alive.” I can already tell this is going to be a great conversation.

The question weighing on my mind – talking to Best Buy from the customer analytics end – was how the retailer was really evolving in a multichannel environment when owning big real estate no longer equals big sales. Best Buy has had plenty of use for predictive modeling, updating its SAS Enterprise Miner solution and newly implementing SAS Model Manager – to cull information and make informed decisions with that data.  Friesen graciously (and candidly) answered some questions for CRM magazine; excerpts from our conversation are as follows: 

 

Are consumers more fickle? How do you reach them in the channel of their choice?

Friesen: “To really take it to the next level, you need to concern yourself with non-transactional events. So one of the paradigms we’re in the middle of shifting is not only thinking in terms of transactions, but thinking in terms of events. An event would be, ‘They call us on the phone, so the call center can see that within their records that that data set needs to talk to all the other data sets…’ so we’re finally investing in piping all of that data together. That, to me, is a major evolution of what I think social media is changing. If you only talk to a customer when they’re buying something from you, and if the only thing you ever talk to them about is buying stuff from you, I think that’s not going to be adequate in the future. So, it actually involves being in a real relationship, which would involve, ‘We know what products you bought and what other products would be compatible with that.’ That’s another thing that’s in development, and more of a product-centric thing – like what things go with what things – and that’s its own major challenge not only for us, but for consumers.  

Are you using social media for any product/merchandising intelligence?

Friesen: “Within the consumer insights unit, we are definitely monitoring sentiment in the blogosphere, and at this point, I would say ‘We’re listening.’ We do, for example, have a robust Facebook presence, and we do respond to things that come in, so it’s not only listening, but some talking going on there. But, again, I think the magic and we’ve not yet taken that step, is how all of that integrates with the other trends. For example, what we’re not doing yet is tying social media trends to inventory positions and that’s a moment where you need to bring those data sets together and you say, ‘Wow-this thing’s just blowing up, everybody wants this hot phone, I’d better get inventory rushed to that place,’ and that’s on a whole different level and I believe that’s in our future.

Talk social media impact on the customer service experience.

Friesen: “I think you can see the people that are angry much clearer than you could before. They used to complain at a cocktail party, and now they post it on the Internet. Globally. That’s the difference. That’s changed the game, and I think a lot of companies are responding to that reality. It raises the bar on how consistent and how excellent you have to be.

Everyone knows of the big box struggle to compete with Amazon.com, especially with the concept of “showrooming” going on.

Friesen: “I think one of the things that’s really interesting is, and I have a tremendous amount of respect for what (Amazon) has done, but in certain respects, it’s easier. They have one channel. And you can’t even really call them. Try calling Amazon. We have stores. We have the website. We have phones, and people call us. Alot. Times millions. We have in-home services where we are visiting people in their home. We’ve got B2B services. You take the amalgamation of all of that and it is extremely challenging from a data standpoint, from an analytics standpoint. The good news is – every moment you start to make those linkages and connect it, the power and completeness of that view and the ways we can positively impact our customers, I think are highly differentiated in the marketplace, and a lot more powerful than a lot of single-channel players, players that for example – don’t have services. That’s one of the reasons why, despite the challenges we’ve had in the media, I feel bullish about the opportunity as we bring these things together.”

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