Top supermarket chain gains insight and boosts profitability with Microsoft Power BI
It’s a challenging time for supermarkets. Economic fluctuation, online competitors, and changing consumer lifestyles have all contributed to the sluggish sales in recent years. Staying profitable means reacting faster than ever to trends both inside and outside the store. Today, leading retailers like Meijer are keeping their competitive edge by finding new ways to work with data.
Tapping into data
Based in Walker, Michigan, Meijer is a major regional supercenter chain with 230 stores in six states. All Meijer supercenters include a pharmacy and most also include a gas station. One of America’s largest private companies, Meijer has a long history of innovation, including the introduction of the modern supercenter more than 50 years ago.
Understanding operational performance and customer behavior was easier when Meijer opened its first stores in Michigan. Now, it’s a different world, with aggressive competition, hundreds of stores, and products that range from groceries and gasoline to electronics and pet supplies. And while the phrase, “There’s more at Meijer” refers to products, it could also apply to data. The company had a potential gold mine of information, but no way to tap into it consistently across the organization.
Meijer was using a variety of technologies to manage information, including a data warehouse based on Teradata, a homegrown business intelligence (BI) tool, and reporting software from other vendors. In addition, the company’s business users relied heavily on Microsoft Excel. However, despite the diversity of technology, the company’s stakeholders all had one thing in common—they relied on IT to help extract insight from data.
Marilyn Richards, Director of Business Intelligence and Collaboration at Meijer, wanted to create a more self-sufficient environment. “No matter where I go, the demand for BI is always greater than the supply,” she says. “And people don’t always have time to wait for IT to build every report. Plus, they were unable to do on-the-fly, ad hoc analysis easily. We have to empower the business customers with relevant and timely reporting to react quickly and appropriately.”
Building a better foundation for BI
Realizing that most employees were familiar with Excel, the company decided to use the spreadsheet software as a starting point for transforming BI. And when Richards and her team learned about Microsoft Power BI and its self-service capabilities, they knew they’d found the right solution. Together with SQL Server Analysis Services and Excel, Power BI would provide the insight and real-time, self-service capabilities Meijer needed to empower employees. Meijer teamed with Microsoft BI partner obviEnce to kick off the project.
Power BI connects to an on-premises SQL Server Analysis Services cube that includes a staggering 20 billion rows of data refreshed in near-real time. With in-memory technologies in SQL Server 2016, the solution provides store directors insight into massive volumes of data—including sales across regions, stores, and individual departments—in less than two seconds.
Although the new hybrid-cloud platform is still in the pilot phase, Meijer is already seeing some impressive results. In a typical scenario, the company had opened three stores within a month. In the past, Meijer’s IT Manager of Business Intelligence, Joseph Openshaw, would have created a portfolio of new-store reports. Then he would painstakingly answer every question from stakeholders. It was a considerable challenge. “We have approximately 800,000 unique product codes and 80 different departments,” he explains. “We sell everything from floral products and underwear to pharmacy and gas. One solution doesn’t always fit every single business.”
But the new solution makes everyone’s job easier. “Now, I create one or two standardized reports that give people a snapshot of the new stores,” says Openshaw. “With Power BI and SQL Server Analysis Services, teams can pull in the data they need and ask their own questions, instead of my having to create a solution that answers every single question.”
Getting insights and boosting profit
And by asking their own questions, Meijer employees can target areas for improvement. For example, a bakery department used Power BI to compare its sales with regional performance. As a result, the department identified opportunities to boost profits. “During the Memorial Day holiday, we increased profits by more than 40 percent just on cookies,” says Matt Craig, Regional Vice President–Eastern Region at Meijer. “With Power BI, we were able to see where we were significantly behind the regional trend, focus on the problem, and create a solution.”
The next step is to extend Power BI and Office 365 companywide to each store, which will also provide access to the latest version of Excel. Openshaw points out that implementation can be carried out with existing infrastructure, including the company’s Teradata system and SQL Server. Then, Meijer looks forward to using Microsoft Azure Machine Learning with Power BI. As a result, it will gain predictive analytics and real-time alerts that can help store directors react faster and more proactively.
Improving access to information
Richards anticipates more data-driven collaboration too. “What I’m looking forward to with Power BI and Office 365 is the ability to easily share reports through OneDrive, SharePoint Online, and Yammer,” she says. “I think Yammer will be very powerful for online discussions and sharing, and even changing reports. It is an exciting step for Meijer in moving forward with collaboration and self-service analytics.”
The cloud solution will also improve access to information across any device without additional effort from Meijer’s IT team. “I love how Power BI knows what device I’m using and surfaces data accordingly,” says Openshaw. “For example, Joe Analyst can pull pricing information into a model and share it with his boss and other analysts, and they can all query the data whether they’re using phones, tablets, or desktops.”
Easier access to information is just one benefit. Openshaw stresses that access to data at the right time, not just real time, is important. Every two hours, his team sends out a sales flash to approximately 800 Meijer business leaders. “With Power BI, they drill down into hourly sales by store and department.’
The company anticipates few barriers to user adoption. “Our team members are so accustomed to having instant communication and getting instant feedback in their personal lives,” says Craig. “They want the same type of information when they try to run the business. We have 300 team members in each of our stores, and they want to get data immediately about every piece of the business from the receiving area to the sales floor to the front end. Power BI enables us to standardize data sources and empower store directors, and ultimately team leaders, to develop and track their own data sets to ensure that we improve.”
Staying ahead of the competition
Ultimately, improving means increasing profits. And increasing profits depends on keeping one eye on customers and another on competitors. “Leaders in the retail environment have to be able to understand whatever is going on in each of their departments and compare that with the competition,” says Craig. “And we have to do that in real time, because if we can’t improve something immediately, a customer will simply go to a competitor. Power BI will help us be more agile and flexible and identify the gaps quicker. That’s why it’s so important.”
We have 300 team members in each of our stores, and they want to get data immediately about every piece of the business from the receiving area to the sales floor to the front end. Power BI enables us to standardize data sources and empower store directors, and ultimately team leaders, to develop and track their own data sets to ensure that we improve.