Top 3 Key Data Governance Challenges in Retail Industry and Solutions

April 30, 2020
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Top 3 key data governance challenges in retail industry

With the Coronavirus pandemic or COVID-19, our personal and professional lives have come to an abrupt standstill. The healthcare system is enduring the harsh impacts of this crisis and the situation is expected to stay alarming for quite some time.

With the exact cause of this virus outbreak unknown and no possible cure seems to be working, the death toll is also rising exponentially.

At such juncture, prevention seems the best course of action,and the lockdown and containment strategy will stay put in the near future until the global healthcare scenario recovers.

Apart from the healthcare system, the political, social, cultural, and not to forget the economic scenario have been at the receiving end of this global crisis.

Present scenario

With most manufacturing units/factories being shut down, supply chains have been disrupted leading to auxiliary crises. The retail industry has been impacted the most due to the disrupted supply chain.

Inadequate inventory, uncertainties pertaining to logistics, resultant shipping delays are some of the over-the-top challenges encountered by the retail industry.

At the outset of this global crisis, data governance is even more crucial for retail giants. As the brick-and-mortar stores are being shut at the present, retailers must make the most of their digital footprint as it seems the only way to stay at the top of the mind of their customers.

With lockdown strategy in practice, customers are no longer able to entertain day-long shopping sprees. They are relying on retailers and eCommerce platforms for purchasing essential stuff online. And, data governance plays a critical role in the success of a retailer’s e-presence, ultimate sales, and revenue boost.

Need of the hour

Mobiles and smartphones have emerged as the window to the external world with the imminent COVID-19 crisis. Thus, brands and businesses must take their retail games up by a notch.

They must focus on delivering automated, seamless, and personalized experiences to foster engagement with existing customers and entice potential ones.

Why data continues to stay the holy grail for retail brands

No matter the industry, data has always played a pivotal role in the decision-making process, strategic or otherwise.

Actionable data-driven insights are even more crucial for retail brands to ascertain customer-centric information such as customer behavior, purchase psyche, past, and current brand interaction patterns.

Data helps retailers to identify opportunities to boost their customer acquisition, engagement, and retention effort as well as enhance their supply chain management efficiency.

With the rise in innovation-led globalization, data is becoming more distributed. The product content of retail brands is being available online across a multitude of platforms. This poses significant challenges for managing data both in terms of volume and variety.

Well, the significance of data is settled now. Despite the growing demand, the data governance landscape is not devoid of imminent challenges. Here are some of the major challenges pertaining to data governance in the retail ecosystem.

Major data-related challenges in retail

1. Multiple touchpoints

Today’s customers are tech-savvy and ultimately immune to monotonous brand promotions. They just don’t take the brand’s word anymore and rely more on reviews by friends and peers across the digital outlets. Digital word-of-mouth has even more significance, lately.

That being said, it is established that the buyer journey has also evolved over the time. It now involves multiple stages and retailers are attempting to capture stage-specific data in the best way possible.

Such data are interlinked and seem to have a chain effect. For instance, the data governance team needs to have a holistic and unified view of data pertaining to the customer purchase order, available inventory, order shipping details, etc.

As retail data are interlinked, they need to be updated seamlessly across multiple systems and platforms. However, the data update responsibility lies with multiple teams. And, there are often scenarios of data silos or obsolete and irrelevant data that may impact the retail brand in the longer run.

How to address

While the distributed nature of data might not be restricted, it can be efficiently managed. A robust, efficient, and centralized data governance system will play a pivotal role in achieving the same.

A data governance system ensures that the retail data stays relevant, up-to-date, and consistent across the multitude of sales and marketing platforms. With the data governance ensuring real-time data updates, data silos can be effectively avoided.

Retailers may enjoy higher visibility on the relevant aspects of their operations that in turn boosts their omnichannel retail and marketing strategy.

2. Redundant data points

Multiple data repositories and data warehouses are common for retail brands that still adhere to conventional practices and principles. Mostly these data repositories function manually.

Every time there is a change in data in a particular repository, no matter massive or huge, the same change must be made across the other repositories. And, this over the time may become cumbersome and overwhelming.

Such scenarios often lead to data inconsistencies. Unarguably, incoherent data will have a huge negative impact on the retail strategy and eventually the productivity, sales ROI, and revenue streams. This also leads to data processing, curation efforts by the concerned retail team members that rather might be a futile effort.

How to address

Easier said than done! Addressing data inconsistency is rather daunting and far-fetched, and a data governance system may come in handy at this juncture.

A robust governance system leverages data pipelines that in turn help in data gathering, curation, modification as well as thorough validation of raw data. This not only enables greater data visualization for the retail brands but also makes data analysis easy, accurate, and quick.

With the right data governance systems in place, retailers can amp up their merchandising tactics, share time-sensitive offer-related information with the customers that are sure to generate more sales and revenue.

3. Data exposure

The seamless functioning in the retail ecosystem requires the sharing of relevant data among the concerned stakeholders such as vendors, third-party entities. No doubt data accessibility if restricted will have long-term impacts on the retail space.

Yet, it may lead to challenges concerning the safety and security of retail and customer data. Though IoT and other technological advancements are essentially considered a boon, they also may pose substantial security threats for sensitive customer information and other relevant retail data.

Unauthorized access to customer data may cost retailers massively and may sabotage the brand-customer trust and relationship. The damage may run deeper than losing loyal customers as retailers might have to deal with operational inefficiencies, road-blocks, and also lost sales opportunities.

How to address

Now, the question arises, how can retailers limit the accessibility of sensitive retail data? An all-encompassing data governance application is the ultimate solution!

Most of the data governance systems come with data encryption, two-factor authentication, and tokenization features. They are crucial in ensuring top-notch security of sensitive information despite several challenges and security threats.


While the challenges in data governance persist, retail brands can adhere to some of the key best practices to obtain optimal results. Setting the retail operational model right from the beginning, adhering to industry-approved data security practices as well as data domain identification, and segregation can benefit retail brands immensely.

For further insights into data governance, its challenges, and ultimate best practices, turn to the experts at Vinculum today!


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