Identity Resolution Daily

By Julie Garcia, Marketing and Public Relations

I spoke recently with Doug Wood, our senior VP of sales who had just returned from the National Retail Federation’s Big Show at the Javits Center in New York. Having spent 20 years in the retail industry, the Big Show is like homecoming for Doug so he ran into quite a few old colleagues and friends (or ‘mates’ as he likes to call them). He said that one of the things on people’s minds is the possibility of a recession and how it would impact retailers. Obviously, when money gets tight, discretionary spending goes down. You gotta pay the mortgage. You gotta put food on the table and gas in the car. But you don’t really need another pair of shoes. Well, I do, but that’s a separate post.

Retailing Today’s recap of the Big Show on their RTTV also listed the downturn in the economy as a key issue at the show. What that means for companies like ours that sell to retailers is that the decision makers are going to be even more focused on return on investment (ROI). Basically, when money is tight for the retailers, your product better make them more money or save them more money. There’s no room for ‘nice to haves.’

That may send a trickle of fear down the backs of some vendors, but we actually feel pretty good about it. Most retailers lose about 1.5% of their revenue to shrinkage, which is, interestingly enough, about half their profit margin. If a retailer could get rid of that shrinkage, they would basically increase their market value by 50%. That’s huge.

Now, you can’t eliminate shrinkage entirely, but you can reduce it dramatically. Just take a look at the graph below. The green bar shows what an existing Returns Authorization Solution declined. The blue bar shows the Identity Resolution Engine uplift and what should have been declined. That’s some pretty dramatic uplift if we do say so ourselves. In fact, recent efforts in the retail and insurance sectors have shown that our Identity Resolution Engine™ (IRE) provides a 20-40% lift over and above the results companies can get with other commercial providers.

So, while I would never say ‘bring it on’ about a recession, we feel pretty sure that no matter what happens with the economy, there is still a very compelling argument for retailers to use IRE to improve their loss prevention efforts.

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This entry was posted on Wednesday, January 23rd, 2008 at 3:14 pm and is filed under Retail, Loss Prevention. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.