Retail Tech Spending in 2017: The Focus is on Customer Experience
Innovative Retail Technologies recently published the results of their annual subscriber survey on retail technology spending drivers for 2017. The overwhelming trend: customer experience.
Trends from 2016 continue in 2017, including mobile for POS and task management for retail associates; customer relationship management; inventory visibility, back office omni-channel initiatives that drive inventory transparency.
Tech Portfolio Confidence Remains “Tepid”
Only 50% of merchants believe their technology portfolio is well-rounded, which is remaining generally the same since 2015. However, 75% believe the technologies they have invested in will help them succeed—a big improvement year over year since 2009.
Following are some specific thoughts behind this general trend:
The Cloud is King
Half of those surveyed (retailers of all sizes and segments) are moving towards the cloud. Many of the roadblocks in the past have been cleared; network, security, and user experience are solid in cloud applications. Other exciting responses were that cloud adoption was reported as the “best” technology decision their companies made in 2015-16, and moving to the cloud was one of the top responses as having the most positive impact on the bottom line.
Omni-channel Investment will be Driven by Inventory Visibility
Over half of retailers surveyed reported that they are “actively investing” in omni-channel technologies and systems. When it comes to inventory visibility across channels, progress has been slower, but recently, confidence is on the upswing. Inventory management and visibility were reported as top priorities for supply chain/logistics spending, followed by warehouse/DC management and price management. This is an indicator of the increased digital influence on retail. Retailers must be able to locate inventory anywhere, then quickly and flexibly fill the order—customers expect this level of service. To attract customers, retailers are investing in price management tools.
Wireless is Coming
Wireless networking and Wi-Fi are in the lead when it comes to in-store software infrastructure priorities, due to the need to connect more with customers digitally (mobile and e-commerce). Likewise, in-store mobile hardware investment is rising, as are retailers who are building out infrastructures to support mobile strategies.
EMV is Still a Priority
Retailers will continue to invest in payment processing. While spending has been steady, payment processing software is a top investment priority.
Mobile trends reflect how important it is to be able to execute on customer experience initiatives, which means software, mobile devices, and wireless networks must work together. Social media and e-commerce platforms are also a part of this picture, as are store associates. Retailers reported being generally satisfied with their staff.
Security is a Concern
With all this focus on customer experience, retailers are still concerned about security. Video surveillance has re-emerged as a top priority, along with payment and mobile security.
The Worst Decisions of 2016
When asked, retailers varied widely on what they believed to be the worst decisions—internally or externally—of 2016. However, what surfaced most often was related to payments. “Lax” approaches to payment security, investment in obsolete payment technology, PCI compliance, and mobile payment were all cited. According to the authors of this report: “As payment processing investments build in 2017, we expect to see increased outreach and collaboration among payment providers and the merchants they serve.”
And the Biggest Surprise…
Surprisingly, few respondents believe drone delivery will “get off the ground”. Most felt that investment in the industry into drones is a big mistake; while the idea sounds fun and futuristic, it’s not a realistic one, when things like regulatory requirements, labor, insurance, and litigation are taken into consideration. The benefits will have to outweigh the costs before drone delivery becomes viable.
Read the entire Innovative Retail Technologies article for more details on the survey results.
Want to start the New Year ahead of the curve? Contact the retail experts at ArcherPoint to discuss your technology strategy for 2017.