Maximizing profits in grocery retail with advanced analytics and organizational maturity

by | May 3, 2023 | Articles

The grocery retail industry has come a long way in adopting advanced analytics to improve business performance and customer experience. However, there is still untapped potential in this field, especially for companies with high levels of organizational maturity.

As the economic landscape continues to evolve, retailers must leverage advanced analytics to remain competitive. In this article, we will explore how organizational maturity and advanced analytics can work together to drive growth and maximize profits.

The adoption of advanced analytics in grocery retail

Over the past several years, many successful grocery retailers have been using advanced analytics to improve various aspects of their business. According to a McKinsey report, industry leaders are already capturing the value of analytics by implementing tools to analyze pricing, assortment, promotions, and customers. However, there is still room for growth as the market continues to change and customer habits evolve.

McKinsey experts suggest that additional value can be captured in the profit and loss (P&L) by using advanced analytics. While companies are already utilizing analytics for assortment, pricing, promotions, and personalization, grocery retailers can potentially increase their earnings before interests and taxes (EBIT) by up to 2% by tapping into P&L.

To achieve this, industry leaders should pursue new, more advanced use cases, such as utilizing better quality data, more granular data, and real-time analytics. This requires a strong analytics department and a high level of organizational maturity, which leads to the next point.

The importance of organizational maturity

Organizational maturity plays a crucial role in capturing the full value of advanced analytics. Companies must develop a good level of organizational maturity before they can fully benefit from advanced analytics.

Organizational maturity affects existing processes and change management practices, which are essential for adopting new technologies and continuously improving use cases. As companies reach higher maturity levels, they can effectively integrate analytics into their daily processes, benchmarking their performance against established KPIs. Without the right processes, tools, and mindset, even the most advanced analytics solution will fall short of its potential.

The goal should be to provide insights to many business users, so they can help drive adoption and promote organizational maturity further.

Choosing between in-house development and external consultants

Deciding whether to develop an advanced analytics solution in-house or rely on external consultants can be a challenging decision. Companies often lack the technical expertise and experience needed to adopt advanced analytics, and gathering requirements from both the business and technical sides can be a tall order.

McKinsey suggests that using external help is the fastest and least risky path, especially for basic use cases like product assortment and forecasting, which are widely available in the market.

Firms like Centida are leading the way in this regard. We have successfully assisted a diverse range of clients, from small businesses to Fortune 500 enterprises, in implementing advanced analytics, underscoring the fact that external expertise can be a game-changer in the world of retail analytics.


In summary, there are still untapped opportunities for grocery retailers to maximize the potential of advanced analytics, particularly for those with high levels of organizational maturity. By focusing on organizational maturity and pursuing more advanced use cases, companies can unlock additional value in their P&L and drive growth.


analytics | BI | sales
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