Will your business be around in a decade?

That’s a tough question to face. But it’s a critical one. 

In fact, nearly a third of retail CEOs admit that their companies won’t be economically viable in ten years if they keep going on their current path. 

So how do you ensure a bright future for your business? How do you compete in a world in which retail giants swallow more and more of the profit? 

Here are four keys to future-proofing your business:

1. Lean into data even more

In the Big Data era, it might sound obvious to say your business needs a data strategy. You’re probably leveraging your website analytics, customer data, and much more.

But two factors loom large here:

• Many retailers have failed to adopt advanced data analytics: As the Harvard Business Review recently reported, “Even as Walmart, Amazon, and a few other leading retailers operate at the leading edge of the analytics frontier, . . . most of their competitors still use very basic tools that are far better able at tracking where they’ve been than where they should be going.” 

• What worked before won’t be enough going forward: Technology has unlocked new streams of data. Much of it can benefit your business in real time — if you commit to keeping up with the rapid pace of development. Companies that are slow to adapt will fall behind.

2. Tap into new data sources

To please your customers and stay ahead of your competitors, your business needs to use new streams of data. 

“Many retailers do a good job analyzing their own transaction data,” says Jonathan Chin, the cofounder and head of growth and strategy at Facteus, an industry-leading consumer transaction data provider. “But the real difference maker comes from looking at consumer-level data that shows spending outside of your own company.” 

For one thing, this data unlocks insights on consumers. “You find out where else your customers are spending money,” Chin says. “The data gives you a look at their entire wallet of spend — where they buy, when they buy, how they buy.” 

There’s another benefit: you can see how your competitors are doing. “You no longer need to run surveys to do a competitive analysis,” Chin explains. “You have the data at your fingertips.”

How does it work? Say you’re a Starbucks executive who wants to see how you’re performing against smaller coffee chains. Since competitors vary by region, you don’t want to see only national data. With consumer transaction data down, you can drill down to region, state, or even city. 

So suppose you want to see Starbucks’ position in California. All you do is run data for California cardholders who have shopped at Starbucks this year. Then see what those customers spend at regional competitors like Blue Bottle, Dutch Bros, and Philz. 

And what do you discover?

• Starbucks has gained back wallet share in California. At the beginning of the year, you were losing 10% of coffee spending to these competitors. But since then you’ve won back 1.2 percentage points.

• But watch out: Dutch Bros is gaining on Starbucks! Earlier in the year, 4.3% of your customers’ coffee spend in California went to Dutch Bros. Now that figure has risen to 5.7%.

• Digging deeper, you see that Dutch Bros fell off in the early summer, only to jump up again. Does this indicate that Starbucks has more appealing summer drinks? That’s something to watch as the weather cools off. 

By the way, that’s all real consumer data that Facteus made available for this article. As you can see, the possibilities for your business are endless.

3. Make data literacy a priority across your organization

High-level data analysis requires a lot of training and technical know-how. Businesses have historically invested in specialized teams with the technical skills to handle data analysis. Many big businesses are even spinning out their own data subsidiaries.

But every day, data becomes more integral to business operations. By 2025, 70% of employees will work closely with data — up from 40% in 2018. “Business leaders can’t truly practice data-driven decision-making if only specialized teams can manage and interpret complex data,” Chin says. “You need to integrate technical and analytical skills with business insight and strategic vision.”

So companies need to make sure their business leaders know how to interpret data. “That doesn’t mean every executive needs advanced technical skills,” Chin explains. “But they need the right training so they can pull insights from the data and make decisions in real time.”

Yet a recent survey shows that most companies are not data-driven. The percentage of companies saying they are has actually declined over the past four years. So by putting data at the core of your business, you can set your company apart from competitors. 

4. Invest in AI

Fortunately, technology has enabled nonspecialists to access and interpret data. 

The most powerful tool is the one transforming so many other industries: artificial intelligence (AI). As Chin puts it, “You need everyone to be data people — and AI helps make that happen.”

Chin notes that Facteus has harnessed generative AI (like ChatGPT) to make data far more accessible. “Now you don’t need to be trained in programming languages like SQL and Python,” he says. “You just have to type in a question and you get back a data-driven answer based on real-time data.”

Where should companies apply AI? Harvard Business School professor Karim Lakhani, a leading authority on AI, has a simple answer: “Well, where do you apply thinking?” 

Lakhani draws an analogy: “If the internet was the cost of information dropping to zero, my sense is that the cost of cognition, how we think, who we think with, is dropping to zero, or lowering significantly.”

The costs are dropping, but the payoff will be massive for your business — especially if you follow these four future-proofing steps.