23rd annual retail technology study
Post on 30-Oct-2015
34 Views
Preview:
TRANSCRIPT
-
7/16/2019 23rd Annual Retail Technology Study
1/12
%
%
RETAIL
P R E S E N T E D B Y
A S U P P L E M E N T T O R I S N E W S A P R I L 2 0 1 3
S P O N S O R E D B Y :
2 3 R D A N N U A L
T E C H N O L O G Y S T U D Y
INSIDE:
Study Methodology
Four Forces of Change
Responding to Opportunity
Reshaping the Store
The Art of Seamless Commerce
Successful Synchronization
Retail at
the
of change
Retail at
the
of change
speed
-
7/16/2019 23rd Annual Retail Technology Study
2/12
S E C T I O NRETAILT E C H N O L O G Y S T U D Y
PUBLISHER
David Weinand
904.374.8590 dweinand@edgellmail.com
SALES
ASSocIAtE PUBLISHER Catherine J. Marder
603.672.2796 cmarder@edgellmail.com
SEnIoR AccoUnt dIREctoR Lisa Wallace
904.217.3489 lwallace@edgellmail.com
SEnIoR AccoUnt dIREctoR Ashley Ramirez
904.372.4017 aramirez@edgellmail.com
ASSIStAnt to tHE PUBLISHER Jen Johnson
jjohnson@edgellmail.com
EDITORIAL
GRoUP EdItoR-In-cHIEf Joe Skorupa
jskorupa@edgellmail.com
ExEcUtIvE EdItoR Adam Blair
ablair@edgellmail.com
ASSocIAtE EdItoR Nicole Giannopoulos
ngiannopoulos@edgellmail.com
ONLINE
vP of onLInE MEdIA Robert Keenanrkeenan@edgellmail.com
WEB dEvELoPMEnt MAnAGER Scott Ernst
sernst@edgellmail.com
dIREctoR of LEAd GEnERAtIon Jason Ward
jward@edgellmail.com
onLInE EvEnt PRodUcER Whitney Ryerson
wryerson@edgellmail.com
ART/PRODUCTION
cREAtIvE dIREctoR Colette Magliaro
cmagliaro@edgellmail.com
ARt dIREctoR Lauren Cloos
lcloos@edgellmail.com
PRODUCTION
SEnIoR PRodUctIon MAnAGER Pat Wisser
pwisser@edgellmail.com
Subscriptions 978.671.0449
Reprints: edgellreprints@parsintl.com
212.221.9595
CORPORATE
CEO/Chairman Gabriele A. Edgell
gedgell@edgellmail.com
President Gerald. C. Ryersongryerson@edgellmail.com
Vice President John Chiego
jchiego@edgellmail.com
CORPORATE OffICE
Edgell Communications
4 Middlebury Blvd, Randolph, NJ 07869
973.607.1300 fAX: 973.607.1395
Member
Member
Printed in the USA
F O U N D E R
Douglas C. Edgell
1951-1998
ABoUt GARtnER
Gartner Research is a leading provider of research and analysis about the global information technology industry. It worked with RIS to bring out
this study, which was conducted during the rst two months of 2013 . In conjunction with the RISeditorial team, Gartner created the survey and
posted it online. Gartner performed the analysis of the data and was then interviewed by RISon the meaning of the data. Gartner was not paid
for its involvement and RIS did not involve any of the advertisers in the report during the preparation or analysis phases.
This years study is based on input rom people who
are senior-level decision-makers within their own orga-nizations. The respondents also represent retail compa-
nies that, due to their size, exert considerable inuence
on retails technology trends. These executives exhibit
both responsibility and authority to set their compa-
nies IT and business agendas, and their insight gives
the study its unique hallmark.
To provide a valuable cross section o the industry,
respondents are invited to participate based on careul
retailer selection, job title, revenue segment and retail
category. Unlike some other studies, the ocus is on
senior-level decision makers. 17% o all survey respon-
dents are CIOs and another 10.4% are C-level execu-
tives. The remainder o respondents include business
leaders who are senior level executives without tech-
nology titles but who have signifcant responsibility or
IT, including directors o IT (39.6%) and departmental
managers (33%), together accounting or just about
three-quarters o the survey pool.
Since large retailers play an important role in driv-ing IT trends, they have large technology budgets and
are a representation o the industrys overall spending.
Many revenue levels are represented, ensuring that the
study is an accurate representation o the diversity in
the industry. The respondent pool is made up o 11.3%
that have more than $10 billion in revenue and 30.2%
that have between $1 billion and $10 billion.
The study also represents retails diversity with ver-
ticals such as apparel/ootwear/accessories, specialty,
hard goods, C-store/drug/grocery, department stores/
mass merchandise/big box discounters and direct
(catalog and e-commerce). The largest verticals repre-
sented are apparel/ootwear/accessories at 23.5% and
specialty at 20.8%, which themselves include a broad
and diverse mix o assortments and business models.
STudy METhodoLogyGaininG technoloGy insiGht from
c-level retail executives
CxO10.4%
CIO17%
Director IT39.6%
DepartmentalMgt.
33%
$10 B
30.2%
$1 B to
$10 B
12.3%
$500 M
to $1 B
7.5%
$250 M to
$500 M
12.3%
$50 M to
$250 M
Apparel/
Footwear/
Accessories
23.5%
C-Store/
Drug/Grocery
16.1%
6.6% Direct(Catalog &E-commerce)
Dept.
Store/Mass
Merchandise/Big Box Discounter
15%
Hard Goods18%
Specialty20.8%
Retail Segment
job title
annual Revenue
w h O r E S p O N d E d
R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3 a P r i l 2 0 1 3 3
RETAILT E C H N O L O G Y S T U D Y
-
7/16/2019 23rd Annual Retail Technology Study
3/12
RETAILT E C H N O L O G Y S T U D Y
E X E C U T I V E S U M M A R Y
FouR FoRcEs oF chAngEa whirlwind of new capabilities will either strengthen retailers or level them
B y J e f f R o s t e R
4 a p r i l 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
The era o true retail inno-
vation has arrived, which
Gartner calls the Nexus o
Forces. In this view busi-
nesses are built on our big pillars:
Cloud, Mobile, Social and Inorma-
tion. These orces join together in
a whirlwind that will either recreate
businesses or level them.
Lets be clear about this. In my
opinion retailers have always been
extremely innovative. Thats the
main reason the industry has so
many home-grown systems. Retail-
ers historically were not satisfed
with the unctionality o packaged
applications and chose to developtheir own sotware. This was abso-
lutely the right decision at the time.
The challenge now is that when
ormer cutting-edge unctionality
gets old it can be a roadblock inhibit-
ing the ability to develop cross-chan-
nel capability. This roadblock leads
to a search or solutions and into the
mix o options retailers discover the
transormative power o the Cloud.
With Cloud capabilities, ormerly
conservative adopters o technol-
ogy have the ability to jump orward
and end up with a 21st century inra-
structure, which is both more nimble
and more cross-channel enabled.
And this is possible to achieve at a
lower cost to operate.
This possibility suddenly opensup new options and also raises ad-
ditional questions, such as: Do Cloud
investments come frst or should
Major action iteMs over the next 18 Months
top 10 technologies for 2013
Developing a mobile enterprise and/or store s trategy
Expanding multichannel (synchronization) initiatives
Developing a mobile commerce strategy
Campaign management and promotions effectiveness
Leveraging social media
Adopting a unified enterprise platform
Cost containment
42.5%
41.5%
30.2%
24.5%
20.8%
19.8%
18.9%
50%
43.4%
42.5%
42.5%
41.5%
40.6%
40.6%
39.6%
39.6%
36.8%
Campaign analysis & forecasting
Standard Forecasting & planning
Mobile POS
Predictive analytics
In-store pickup or return of web goods
Multi-channel planning & forecasting
Campaign management
Allocation
Assortment planning
POS peripherals
-
7/16/2019 23rd Annual Retail Technology Study
4/12
RETAILT E C H N O L O G Y S T U D Y
E X E C U T I V E S U M M A R Y
6 A P R I L 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
paring to give customers access to
greater inormation and services.
This is heralding a new era or retail-
ing. Hopeully its not too late.
ConCLusIonThe year ahead or retailers is flled
with challenges, opportunities and
critical decisions. Successul retail-
ers will have to build innovation and
risk taking into their organizational
DNA or risk obsolescence or worse,
irrelevance.
The old adage, ailure is not an
option, is exactly the wrong recipe
or success in the new social/mobile
enabled enterprise. You learn rom
ailure. Retail success has always
been through innovation, determi-
nation and no small amount o luck.
In this new era we are entering, suc-
cessul retailers will need all three in
abundance.
Mobile be frst? How do we harvest
real insights out o the Inormation
weve warehoused or so many
years? And where does Social ft
into the puzzle?
The answers to these questions
will dictate retail success in 2013
and beyond. Welcome to the Nexusand good luck.
MAjoR ACtIon IteMs
Mobility has moved to the main-
stream or oreront o retail strategy,
which is no surprise because its
been buzzed about or several years.
But this years data indicates we are
now seeing real adoption. The hype
is gone, the reality is here, and retail-
ers are moving orward aggressively
with mobility as a key strategy.
Social media slipped down on
the priority list o major action items
this year rom the top perch to fth.
But thats not a bad thing. We are
still quite early in the serious adop-
tion phase and I expect it will rise
higher as the Chie Marketing Of-cer continues the digitization o re-
tail marketing budgets.
The rise o the CMO is clearly
evidenced in the 14% o the respon-
dents who have made a top priority
out o providing marketing depart-
ments with advanced IT tools. Some
retail IT departments could see this
rise as a new competitor or scarce
budget resources. That would be a
mistake. I believe its critical or the
CIO to lead the charge in empow-
ering marketing with the tools or
cross-channel success.
PAIns to oveRCoMe
Retiring legacy systems: This is a
datapoint that has gotten tremen-
dous attention rom both retailersand vendors alike.
Vendors view this as an oppor-
tunity and it is. But theres a clear
warning here because some ven-
dors and their solutions are on the
wrong side o the retirement trend.
Its an equally serious warning
to retailers, because it indicates that
competitors are aggressively improv-ing their capabilities. The key ques-
tion or retailers to ask is: Are you
ready to engage in the business o
retail with a competitor who has im-
proved every aspect o its business
and is operating in a cross-channel
mindset? I not, now is the appointed
hour to remedy the situation.
Empowered consumers: Retail-
ers are now dealing with a consum-
er that has better knowledge than
associates and consumers also have
direct access to competitors while
standing in your store.
But instead o whining about
showrooming, smart retailers are
aggressively battling back and pre-
Top Challenges over The nexT 3 Years
Retiring legacy systems
Developing applications to satisfy empowered consumers
Application integration
Managing big data
Optimizing stores as a major channel
Consumer smart devices in the enterprise
Upgrading store-level bandwidth and infrastructure
PCI compliance
Mobile security
45.3%
41.5%
38.7%
36.8%
32.1%
29.2%
23.6%
17.0%
12.3%
Je Roster is vice president industry market strategies, retail or
Gartner. This is the 13th year he has been the chie analyst or the
Retail Tech Trends Study.
-
7/16/2019 23rd Annual Retail Technology Study
5/12
RETAILT E C H N O L O G Y S T U D Y
I T B U D G E T S
Examining thE gap bEtwEEn succEss and survival in thE agE of rEtail transformation
B y J o e S k o r u p a
8 a p r i l 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
During the Great Recession
Warren Buet noted that
when the tide goes out
you see who is swinning
with pants and who isnt. During
the downturn, some without pants
ound cover and some didnt. For
the latter, exposure was both em-
barrassing and costly.
Today, the tide is rushing back
in and a dierent phenomenon
is taking place. Now we see who
has a oundation that can manage
the food and who will get washed
away. The thing about oundations
is they need consistent shoring upor they weaken over time.
The rise o smart, digital shop-
pers and introduction o disruptive
technologies over the last couple o
years have weakened the ounda-
tions or some retailers by under-
mining the traditional strengths o
their core business brick-and-mor-
tar stores.
A major undermining orce
comes rom online pure-play retail-
ers who have perected the art o le-
veraging their inherent advantages.
Until recently, traditional retailers
essentially ignored the threat, rea-
soning that Internet sales were a
relatively small part o the overall
revenue pie. When Internet sales get
larger, so the reasoning went, it willbe time to stop dabbling and sink
major investments into it.
That time has arrived. But ater
REspondIng To oppoRTunITy
IT BudgeTs as a PercenT of ToTal revenue
change In Year over Year IT BudgeT
5%1% to 2% 2% to 3% 3% to 4% 4% to 5%
11.3%
30.2%
10.4%
6.6%
1.9%
7.5%
Decrease
>10%
Decrease
between
5% to 10%
Decrease
between
1% to 5%
No
Change
Increase
between
1% to 5%
Increase
between
5% to 10%
Increase
>10%
4.7% 3.8% 4.7%
28.3%26.4%
16% 16%
-
7/16/2019 23rd Annual Retail Technology Study
6/12
RETAILT E C H N O L O G Y S T U D Y
I T B U D G E T S
1 0 A P R I L 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
years o online experimentation
and maturity by pure-plays, a new
phenomenon has emerged and
suddenly traditional retailers see
that pure-plays are beating them to
growth opportunities. Not only that,
but pure-plays are also investingheavily in disruptive technologies to
hijack market share rom traditional
retailings core business brick-and-
mortar stores.
In the age o retail transormation
the spectrum o opportunity ranges
rom success on one end and surviv-
al on the other. The deciding actor
is the strength o the retailers oun-
dation.
AmAzon Is not
the PRobLem
Its tempting to single out Amazon
as the traditional retailers arch-en-
emy, but larger orces are at work.
Pure-play retailers as a group have
a start-up mentality that drives them
to be frst to market with innova-tion. They are adept at developing
state-o-the-art websites, exploiting
low prices, pioneering advanced
analytics and perecting high-speed
ulfllment.
Their aggressiveness is backed
by large technology investments
and a willingness to learn rom ail-
ure. A business model o this type
chips away at the oundations o
traditional retail brands, who with
ew exceptions have not made the
necessary fnancial commitments to
match fre with fre.
But there is evidence o change.
Retailers like Walmart, Target, Nord-
strom, Macys, Urban Outftters and
Saks, to name several leading exam-
ples, have converted their omnichan-nel strategy rom a buzzword into a
plan o action. Each has recently re-
ported strong fnancial earnings that
indicate they are reaping monetary
rewards or their eorts.
As we examine this years IT bud-
get trends we fnd that retailers, led
by those cited above, are increasing
their tech investments in 2013. This
is a positive sign, but perspective is
needed. Note that retail tech invest-
ments are made in the millions o
dollars with a capital M. Amazons
tech investments are made in the
billions o dollars with a capital B.
From this perspective retailers
with the best chance o making up
ground against aggressive pure-plays are those investing in technol-
ogy at levels above the industry av-
erage, which is less than 2% o total
annual revenue.
From the data in this years study
we see that the group o above-aver-
age tech investors comprises 26.4%
o retailers. This aggressive group is
composed o a spectrum o retailers
that ranges rom slightly above av-
erage tech investors, those commit-
ting 2% to 3% o revenue to technol-
ogy (10.4% o the respondent pool)
to those that are committing more
than 5% o revenue to technology
(7.5% o respondents).
Obviously, the latter group is tak-
ing an aggressive stance and willlikely become better positioned to
capitalize on the orces o change
sweeping through retail.
Maturity of it architecture
Advanced IT
infrastructure/
systems w/ deep
integration
Mostly basic IT infrastructure/
systems w/ some advanced
upgrades
Mostly advanced
IT infrastructure/
systems w/ some gaps
in integration
32%
13%
36%
19%
Basic IT infrastructure systems
w/ critical limitations
architecture approach to Software
Seek best of breed software
Seek integrated solutions suites
Seek software-as-service models
Use third-party services to help develop software
Use in-house IT resources to develop software
57%
51%
39%
31%
36%
-
7/16/2019 23rd Annual Retail Technology Study
7/12
RETAILT E C H N O L O G Y S T U D Y
I T B U D G E T S
Drilling one level deeper into
budgets, we see that ew retailers
are actually planning to decrease
spending on IT, just 13.2%. But
a much larger group plans to go
through the year with a at (no in-
crease) budget projection 28.3%.
That means that 58.5% intend toincrease their IT budgets year over
year, which is 5 points higher than
last year. As previously noted, the
important act to consider is not just
that retailers are investing more in
technology year over year, but how
much more they are investing. Is it
enough to maintain status quo when
you actor in ination and the cost o
opening new stores? Is it enough toclose gaps with competitors?
When looked at through this lens
we see that 32% o retailers are ag-
gressive IT investors, meaning their
budgets committed to IT are ris-
ing at an above average level. This
group consists o 16% who will in-
crease IT budgets 5% to 10% year
over year and 16% who will increasetheir IT budgets more than 10%. The
good news is this aggressive group
o 32% is nearly twice as large as it
was last year (17%).
IT STraTegy
I retailers were making steady in-
vestments in their IT inrastructure
in such areas as advanced upgrades
and deep integration, we would ex-
pect to see year-over-year progress
in the maturity o their architecture,
applications and tech stack. To be
able to track this progress we would
need to ask the same question in the
same way each year, and we have
done that.
On the lowest step o maturity,
which we call basic IT inrastruc-ture and systems, we see 13% o
respondents, which is down slightly
rom last year. One step up is called
mostly basic with some advanced
upgrades. Here we see a dramatic
reduction rom 45.7% in 2012 to
32% in 2013. So, clearly, retailers aremoving out o these two lower steps
on the maturity ladder.
The biggest gainer in this maturi-
ty model is called mostly advanced
but lacking comprehensive integra-
tion. This jumped rom 22.9% last
year to 36% in 2013, a huge leap.
And in the fnal step, called ad-
vanced IT inrastructure with deep
integration, we see a rise o two
points year over year.
The data shows a picture o
emerging inrastructure strength
or a majority o retailers. Those on
the lower rungs o the ladder will be
acing sti headwinds.
As the retail tech stack evolves so
does the architecture approach to
sotware. Seeking best-o-breedsotware (chosen by 57%) has
been the top approach chosen by
retailers or many years because it
oers the most exibility.
Using IT resources to develop
sotware has also been a top ap-
proach, and last year it came in sec-ond place, just two points below the
best-o-breed option. But this year
developing sotware in-house drops
ar down the list and was selected
by just 31% o respondents.
This datapoint indicates another
kind o maturity taking place in retail
technology the maturity o pack-
aged sotware solutions to deliver
what retailers want. Previously, re-
tailers had been orced to write their
own sotware to get the retail-spe-
cifc solutions they needed. But this
is no longer the case or more than
two thirds o retailers.
As the whirlwind o change plays
out in retail, it will reward those
who are investing wisely to shore
up their oundations. For those whohad been investing wisely and con-
sistently over the last several years,
the rewards will be even greater.
Top 10 IT ServIce provIderS reTaIlerS Seek
for STraTegIc InSIghTS
Microsoft
IBM
Oracle
SAP
Cisco Systems
JDA
Deloitte
HP
NCR
Accenture
41.5%
37.7%
30.2%
26.4%
23.6%
15.1%
13.2%
12.3%
11.3%
10.4%
The archITecTure maTurITy model ShowS
a pIcTure of emergIng STrengTh for a
majorITy of reTaIlerS.
1 2 a P r I L 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
-
7/16/2019 23rd Annual Retail Technology Study
8/12
RETAILT E C H N O L O G Y S T U D Y
S T O R E S Y S T E M S
MOBILITY, RFID AND CUSTOMER LOYALTY INVESTMENTS ENHANCE STORES PIVOTAL ROLE
B y A d A m B l A i r
The store remains a key fo-
cus of technology invest-
ments and the reasons are
obvious: despite the im-
pressive growth of digital channels,
stores are still where the vast major-
ity of transactions take place. But a
funny thing is happening to store ITas retailers move closer to a seam-
less omnichannel operating model.
Retailers are beginning to use
store technology not just to sell
more products but to learn more
about their shoppers, as demon-
strated by high levels of current ac-
tivity and future interest in frequent
shopper/loyalty programs and shop-per tracking capabilities.
The desire to gather as much in-
formation as possible during a cus-
tomers store visit makes sense.
As stores become just one channel
among many that todays consumers
use on their path to purchase, retail-
ers are importing the data-gathering
and analytics theyve used in the dig-
ital world into the brick-and-mortar
sphere.
POS ON THE MOVE
One major theme in this years study
is the accelerating move to mobility,
in this case to mobile point-of-sale.
Nearly three in 10 respondents have
already invested in mobile POS, and
another 22.6% say they are planningto invest in 2013.
However, it should be noted a
solid 35.6% say they have no mobile
REshApIng ThE sToRE
1 4 A P R I L 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
StatuS of PoS technology
StatuS of Item-level RfID
DoeS youR oRganIzatIon Plan to InveSt
In mobIle PoInt of Sale (PoS) In 2013?
POS terminals (traditional, fixed)
POS peripherals
POS software
Self checkout terminals
Mobile POS
47%
39%
39%
8% 14%6%
5%
6% 14% 28% 18%
18% 18% 14%
17% 20% 11%
15% 15% 8%
Up-to-date tech in place Started but not finished major tech upgrade
Will start major tech upgrade in next 12 months Will start major tech upgrade in next 12-24 months
Don't know
12.3%
Yes, already investing
29.2%
Yes, planning to invest during 2013
22.6%
No
35.8%
Item level RFID 4% 6% 5% 14%
Up-to-date tech in place Started but not finished major tech upgrade
Will start major tech upgrade in next 12 months Will start major tech upgrade in next 12-24 months
-
7/16/2019 23rd Annual Retail Technology Study
9/12
RETAILT E C H N O L O G Y S T U D Y
S T O R E S Y S T E M S
1 6 A P R I L 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
POS plans, reinorcing the point that
there are retail environments where
this technology does not appear to
add value at this early phase.
One in our (25.5%) o respon-
dents say they will decrease the
number o xed POS units in storesas a result o their mobile POS in-
vestments, though nearly two-thirds
say they will not, implying that in
many store settings, mobile POS
will be an addition to, rather than a
replacement or, traditional POS.
Do these trends spell a slow de-
mise or traditional POS systems?
Certainly not. Spending plans re-
main solid and will remain that wayas xed-POS stations evolve. One
way to describe the planned de-
crease in xed-POS stations is right
sizing. In many stores all POS lanes
are intermittently manned. The ad-
dition o mobile POS to the mix en-
ables retailers to serve customers
during sales peaks while simultane-
ously removing rarely used lanes.Nearly hal (47%) o respondents
have up-to-date POS terminal tech-
nology in place, and 39% are up to
date with their POS sotware and pe-
ripherals. The percentage o retail-
ers with upgrades already in prog-
ress is in the high teens or all three
technologies, and is at similar levels
or those planning upgrades during
the next 12 months.
RFID RIsIng
Another area showing both prog-
ress and promise is item-level RFID.
In recent years, major retailers have
not only gotten on board but strong-
ly publicized this technologys ben-
ets. The change can be seen rom
the 2012 Tech Study, when only 1%o respondents had up-to-date tech-
nology, to the 4% that are up to date
this year. An impressive 14% o re-
tailers plan an RFID upgrade within12 to 24 months.
This years other star technol-
ogy is actually an old retail standby,
the requent shopper/loyalty pro-
gram: it tops the list o current up-to-
date store technologies at 29%, and
also shows strong gures or cur-
rent and uture investment (a total
o 30% within the next 24 months).Learning as much as possible about
individual customers is seen as criti-
cal to customer engagement and the
more targeted, personalized market-ing necessary in todays inorma-
tion-saturated age.
Retailers are also turning a more
analytical eye on the way custom-
ers shop their stores, as refected in
the strong gures or shopper track-
ing capabilities. These technologies
have advanced ar beyond tradi-
tional trac counting and can pro-vide important insights into stang,
merchandising, marketing and cus-
tomer service.
Will your organization decrease fixed Pos units
in stores during 2013 due to mobile Pos investments?
status of sto re technology
Yes, plan to decrease f ixed POS
25.5%
No plans to decrease
fixed POS
63.6%
Don't know
10.9%
Frequent shopper or loyalty program
Store level loss prevention
Kiosks
Shopper tracking capability
Store level task management
Digital signage displays
NFC (Near Field Communication) payments
Electronic shelf labels
29% 21% 12% 19%
25% 1 4% 8% 16 %
19% 8% 10% 13%
19% 16% 11% 19%
17% 11% 12% 21%
10% 1 3% 9% 14%
5% 1 1% 7 % 2 0%
3%
6% 14%
3%
Up-to-date tech in place Started but not finished major tech upgrade
Will start major tech upgrade in next 12 months Will start major tech upgrade in next 12-24 months
-
7/16/2019 23rd Annual Retail Technology Study
10/12
T E C H T R E N D S
RETAILRETAILT E C H N O L O G Y S T U D Y
C R O S S C H A N N E L
ThE ART of SEAmLESS CommERCEclimbing up the maturity ladder to synchronize the shopping experience across channels
B y J o e S k o r u p a
Until a ew years ago, e-
commerce operated as i
it were on the edges o the
retail enterprise, somewhat
similar to a surprisingly successul
startup or large pilot program. The
revenue generated by e-commerce
in this view was thought o as addi-
tive to the core business but not reallypart o the core itsel. This mentality
also extended to how e-commerce
technology ft into the tech stack.
But those days are rapidly draw-
ing to a close. A number o retailers
recently reported 50% year-over-
year increases in online revenue
capping several years o double
digit growth. When revenue fgurestravel an upward arc like this they
begin to attract serious attention
and so do the eorts to more closely
integrate digital channels into the
core business.
When we examine this trend over
the last two years we see that sig-
nifcant progress has been made in
e-commerce maturity and mobile
channel development.One way to track e-commerce ma-
turity is to check the upgrade status o
the e-commerce platorm, the basic
building block o online retailing. I re-
tailers are steadily investing in e-com-
merce capabilities we would expect
to see signs o maturity emerge in
upgrade status over time, and we do.
Last year, or example, 16.9% oretailers said they dont have an e-
commerce platorm and this year the
number drops to 14.2%. Even more
dramatic is the number o retailers
who say they have replatormed with-
in the last two years and thereore
have up-to-date technology 27.4%
this year compared to 18.3% last year.
In the mobile channel we can see
that progress is moving steadily or-ward, but not at a brisk pace. The
reason or the measured pace is that
current sales volumes in the mo-
bile channel are still low compared
to overall sales. Where we see the
most activity is the datapoint or
pilots in progress 28.3% this year
compared to 24.1% in 2012.
Although many in retail have
dubbed 2013 the year mobility be-comes a reality, it is also true that it
will take several years beore it ully
enters the retail mainstream.
R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3 a p r i l 2 0 1 3 1 7
StatuS of E-CommErCE P latform
StatuS of organizationS CuStomEr faCing
mobilE ChannEl dEvEloPmEnt
Re-platformed within 2 years,
no need to upgrade
Plan to upgrade within 24 months
27.4%We don't have an
e-commerce platform
14.2%
Platform needs updating,
but no plan to upgrade
Currently upgrading
platform now
7.5%
28.3%
Plan to upgrade within 12 months
15.1%
7.5%
Fully functioning mobile
commerce strategy in place
9.4%
Pilots in progress28.3%
Not planning any activity17.9%
Planning under way44.3%
-
7/16/2019 23rd Annual Retail Technology Study
11/12
M E R C H A N D I S I N G & S U P P L Y C H A I NRETAILT E C H N O L O G Y S T U D Y
1 8 A P R I L 2 0 1 3 R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3
TIghTenIng The LInkAge beTween meRchAndIsIng And The suPPLy chAIn
B y J o e S k o r u p a
SuccESSfuL SynchRonIzATIon
Retail organizations are
composed o a number o
departments that rely on
each other to share inor-
mation in a symbiotic relationship.
When the departments are synchro-
nized the enterprise is capable o
delivering a greater level o peror-mance than the sum o its parts.
But interdepartmental linkage
goes deeper than that. In many cas-
es, the output o one department is
the input or another. For example, in
a car company the engine or a vehi-
cle is built in one plant and shipped
to another plant or fnal assembly. I
the engine plant is running behind,
then a chain reaction occurs and the
production o fnished vehicles will
get delayed.
This concept, which is also a
orce at work in retail enterprises, is
known as interdependence, and it is
especially evident in the linkage that
occurs between the merchandising
and supply chain departments.
meRchAndIsIng And
suPPLy chAIn PRIoRITIes
The process o replenishment o
products to stores is a perect ex-
ample o interdependence between
merchandising and the supply
chain. It is so critical to store per-
ormance that 33% o retailers have
made it a point to keep their replen-ishment technologies up to date, the
highest level o up-to-date tech on
the merchandising priority list.
A substantial number o retailers
(21%) also say they have begun but
not fnished major upgrades to their
replenishment systems. This means
that more than hal o retailers (33%
up-to-date plus 21% with projects
underway) have been involved with
upgrading their replenishment sys-tems within the past ew years. This
is a large amount o IT activity and
it is indicative o how important re-
plenishment is to meeting sales and
merchandising goals.
Three other items on the mer-
chandising priority list deserve
special notice. They are campaign
analysis and orecasting, campaign
management, and multi-channel
planning and orecasting. Thesethree are noteworthy rom a data
analysis perspective because they
register the highest levels o uture
StatuS of MerchandiSe technology
Replenishment
Item management
Forecasting and planning
New product or private label development
Allocation
Category management
Assortment planning
Price and markdown optimization
Product lifecycle management
Campaign analysis and forecasting
Shelf and space planning
Campaign management
Multi-channel planning and forecasting
Replenishment
Item management
Forecasting and planning
New product or private label development
Allocation
Category management
Assortment planning
Price and markdown optimization
Product lifecycle management
Campaign analysis and forecasting
Shelf and space planning
Campaign management
Multi-channel planning and forecasting
21%33%
25%
24% 25% 19% 13%
24%
21%
21%
19%
19%
17%
15%
12%
9%
8%
21%
16%
20%
25%
12%
22%
19% 14% 8%
25% 25% 16%
14% 15% 13%
15% 15%16%
23% 17% 12%
17% 15% 11%
21% 19% 7 %
13% 14% 8%
18% 17% 8%
11% 10%
Up-to-date tech in place Started but not finished major tech upgrade
Will start major tech upgrade in next 12 months Will start major tech upgrade in next 12-24 months
-
7/16/2019 23rd Annual Retail Technology Study
12/12
M E R C H A N D I S I N G & S U P P L Y C H A I N
R I S R E T A I L T E C H N O L O G Y S T U D Y 2 0 1 3 A P R I L 2 0 1 3 1 9
investment plans in the merchandis-
ing category and, just as signifcant-
ly, all three are important to market-
ing executives, the new center o
gravity in retail organizations.
Campaign analysis and orecast-
ing not only registers strong current
activity (with 25% saying they have
already begun upgrades) but it also
shows strong plans or uture de-
ployment 25% say they will start
within 12 months and another 16%
in 12 to 24 months.
Campaign management is equal-
ly strong with 21% working on up-grades now, 20% who will begin in
12 months, and 12% who will begin
in 12 to 24 months.
Multi-channel planning and ore-
casting, oten reerred to as an om-
nichannel strategy, lags in current
activity (16% deploying now), but
strong uture intentions will enable
it to quickly catch up 25% will de-
ploy within 12 months and 22% will
begin in 12 to 24 months.
In supply chain trends we see con-
frming evidence that multi-channel
strategies are gaining traction, espe-
cially in the area o multi-channel ul-
fllment. Here we see that 18% plan
to begin deployment o an upgrade
within 12 months and 22% will begin
in 12 to 24 months.All o these technologies are wor-
thy o singling out because their
numbers are signifcantly higher
than the others on merchandising
and supply chain priority lists. But
when we look at a related area o
demand-chain technology, business
intelligence and analytics, we see
numbers that are even higher. In act,as a group BI and analytics shows
the strongest set o purchase inten-
tions across the board o any other
technology grouping in the study.
The lowest rated technology or
uture investment, or example, is
market basket analysis, where 29%
o retailers say they will be upgrad-
ing within 24 months. The highest
is predictive analytics, where 46%
say they will be upgrading with-
in 24 months. A close second is
social media analytics (43% upgrad-
ing within 24 months), which is not
only the newest kid on the block, but
perhaps the most difcult to eec-
tively manage.
StatuS of BI/analytIcS technology
StatuS of Supply chaIn technology
Warehouse management systems
Distributed order management systems
Transportation management systems
Sourcing
Real time inventory visibility
Multichannel fulfillment
Trade promotion management
Radio frequency identification (RFID) case/pallet
Warehouse management systems
Distributed order management systems
Transportation management systems
Sourcing
Real time inventory visibility
Multichannel fulfillment
Trade promotion management
Radio frequency identification (RFID) case/pallet
16%32%
24%
24% 14% 8% 13%
22%
20%
16%
8% 12%
7% 8% 9%2%
17% 10%
16% 18% 22%
14% 19% 17%
13% 10% 11%
13% 8% 18%
11% 8%
Up-to-date tech in place Started but not finished major tech upgradeWill start major tech upgrade in next 12 months Will start major tech upgrade in next 12-24 months
Market basket analysis
Shopper tracking
Margin optimization
Predictive analytics
Social media analytics
Market basket analysis
Shopper tracking
Margin optimization
Predictive analytics
Social media analytics
21%25%
21%
19% 16% 16% 17%
10%
9% 18% 17% 26%
18% 25% 21%
22% 15% 20%
16% 13%
Up-to-date tech in place Started but not finished major tech upgrade
Will start major tech upgrade in next 12 months Will start major tech upgrade in next 12-24 months
T E C H T R E N D S
RETAILRETAILT E C H N O L O G Y S T U D Y
top related