The adoption of location intelligence in strategic decision-making within the retail industry

Abstract

The upward trend of online shopping, together with rapid technological advancements and evolving consumer behaviour results in increasing decision-making complexity for retailers. Location, whether site selection for a new retail store or understanding target markets, is more complex now than ever before. Location intelligence has emerged as a technology that is fundamentally changing the retail game and offering early adopters a competitive edge. The purpose of the study was to undertake an analysis of the role that location intelligence plays in decision-making as a strategic enabler for South African retail growth. Through an exploratory qualitative research design, making use of semi-structured interviews with 12 high-ranking executives, the research explored whether retail executives were aware of the term ‘location intelligence’ and to what extent they had been exposed to geographical or location-based tools and technologies for decision-making. Furthermore, the research explored retail executives’ perceptions of the role of location intelligence for competitive advantage as well as to what extent location intelligence has been adopted for strategic decision-making. Key findings from the thematic analysis showed that location intelligence is understood from an operational perspective and not core to the firms’ retail model and strategy. The study also found that although executives believed that location is key to their organisation’s success, they were unaware of the benefits of location intelligence for strategic decision-making. This research contributes to Retail Decision-Making Theory and the internal environment component of the retail location planning and decision-making model in that macro, meso and micro factors influencing retail location decision-making were understood. Furthermore, the study contributes to Location Theory from a strategic perspective. The outcome of this research also provides some insight into the extent to which location intelligence has been adopted within the South African retail sector. The research offers key recommendations for the adoption of location intelligence and mentions areas for future research