While the retail technology space has boomed just as quickly as commerce moved online, some sectors still relied on older management systems and tactics well after others had upgraded.
“In this hyper-competitive space with many new entrants and high consumer expectations, you have to be able to make decisions a lot faster,” said Gary Liu, VP of marketing at retail enterprise software-as-a-service provider Boomerang Commerce.
Founded in 2012, the idea for Boomerang’s platform came to be during founder and CEO Gurushyam Hariharan’s time on the retail merchandising and supply chain team at Amazon in the early 2000s.
Hariharan was tasked to work on developing technologies to move Amazon’s strategy and decision-making out of spreadsheets. He saw an opportunity to leverage technology and provide it as a service to other retailers, said Liu, enabling them with a platform that they can use to drive merchandising decisions and strategy and to optimize their pricing.
“Chief merchants and category managers were still moving in spreadsheets,” Liu said. He noted that while they had point-of-sale (POS) systems, product catalogue data, the CRM and eCommerce systems, all of that data is still largely unstructured, requiring aggregation and analysis to effectively make decisions.
Today, Boomerang’s Retail Performance Management Suite of solutions enables customizable, near real-time, data-driven merchandising decisions for enterprise retailers. The platform leverages machine learning, Liu said, pulling in SKU data, current prices, and online and in-store performance data from the retailer’s various sources.
“We combine their data with external market signals,” Liu said, “whether that might be what’s trending based on searches, bestsellers in certain categories, a competitive pricing data feed — and then we match those external data points with the internal data in our Data Dictionary.”
Boomerang’s platform then applies machine learning toward this data to determine the optimal strategies and merchandising decisions for each retailer’s various categories, brands, and SKUs.
On top of the platform sits a newly released application called price performance management (PPM), which leverages the data elements from the Data Dictionary to track pricing.
“So that they aren’t bombarded by tons of data,” Liu said, “we point to the areas of high and low impact, and, on the low-impact end, PPM recommends areas that require that merchant’s attention.”
For example, say that a retailer’s key value item is priced competitively due to changes at a competitor store. Based on those signals, PPM recommends that merchants take action, providing appropriate out-of-the-box strategies along with strategies that retailers have themselves developed.
“From there,” Liu said, “retailers can watch that, track performance and close that loop.”
Boomerang’s platform is scalable and can be installed in a variety of different manners and speeds. For example, a client could tie the platform to their PoS system, allowing in-store prices at checkout to reflect changes in online pricing.
“I might not want sales associates to update display prices every day, but I might want to have those prices ring up at the POS if my strategy is to drive positive customer in-store experience,” Liu said.
Boomerang Commerce now works with 10 of the top 30 in Internet Retailer’s 500, along with many others. Boomerang drove over 2.5 billion pricing decisions in 2016, said Liu, helping customers drive an aggregate of over $500 million incremental revenues and concessions.
Liu gave an example from one of Boomerang Commerce’s clients, Groupon. Currently, Boomerang manages over 400,000 SKUs for Groupon Goods, the company’s physical goods segment.
Before signing on with Boomerang, Groupon performed manual research and pricing updates with a 30-day SKU turnover rate. Applying PPM and building a portfolio of SKU pricing strategies to optimize their inventory using Boomerang’s platform, Groupon Goods saw a 12 percent increase in revenue lift on the SKUs priced using Boomerang.
Larger retail enterprises are more likely to see numbers in the single digits, Liu noted, with the largest seeing some 1 percent — still a significant lift on multiple billions in revenue.
Moving forward, Boomerang Commerce will continue to innovate, Liu said. Next week, the company will make more announcements at ShopTalk around additional upcoming applications that will run on top of their Retail Performance Management platform.