Accelerating the Innovations in Retail Technology
Technology Integration to Add Incremental Value It used to be that Technology’s primary purpose was to create intelligence through efficiency, ideally affording substantial savings. Now, in addition to driving the bottom line, Technology is an integral component to the top line, serving as a more easily accessible treasure trove of rich information & a greater facilitator of consumer connectivity.
However, while Technology is unquestionably maturing retailers’ capabilities and accountability in providing seamless customer experiences, most retailers are far from the end-goal because of past decisions that were more about short-term gains, less about the longer lookout.
Historically, in retail, as new opportunities surfaced, even eCommerce, they were bolted on, but never integrated. The practice of system and application integration is more standard today, but proving to be far from simple. With disparate systems come fragmented processes and ultimately hard-tochangeover behaviors. It’s much like a patient with clogged arteries. A triple bypass is necessary, the recovery is long and painful, and major lifestyle changes are vital, but years are added back onto the patient’s life.
The challenge around this, however, is the sheer number of systems & solutions in the marketplace. To say its overwhelming is a massive understatement. The ability to easily match requirements to solution providers’ capabilities is becoming an art form in this crowded, rampant marketplace. As equitable partners to the retailer community, Technology providers need to proactively identify other complementary providers that integrate well and add incremental, non-redundant value to their core offering(s). There are some who have built their evolving business model around this and seen great success. It significantly reduces the upfront pressures and risks retailers encounter when attempting to stitch together a full system footprint from scratch. In turn, retailers need to remain more prudent in enforcing technology standards and be transparent about requirements early & often.
Intelligently Accessing Relevant Data
Like most things, this will be unique to each retailer, based on their vision & priorities, but a few broader “guiding principles” include:
1) Foster a data-centric culture, with centralized business intelligence so that the same data comes out, no matter who pulls it. Of course, the interpretation of the data might vary on the person analyzing it, but the data itself should be pure.
2) Right-size your data-set, don’t chase every datapoint. Retailers who are well-informed about their consumers are because they have a deep, and more importantly, selective understanding of what they need to know. They have a consumer intelligence framework to ensure that information collected and analyzed equals power. It must drive action and results at their expected baseline or above. They take the responsible path in not having to collect everything, which enables them to draw faster conclusions.
3) Gear up for Millennials. As the first generation to grow up with computers in home & in-hand, they’ve largely, if not entirely, lived in a world of fast-paced, ever evolving technology. From an early age, they learned that input created output in a digital form. As such, they get the premise of value exchange better than any other generational demographic. While they are more open to sharing, they demand great responsibility & care in return. And as the most connected generation, not complying with their expectations will come at a greater penalty. Overall, data is in abundance and will only continue to multiply at staggering rates. First identify what you need to know, (a plea to keep it simple) and then determine most reliable means to access it.
The Balancing Act
The challenge is to maintain a balance, both in thought and action. Allowing ourselves to become overwhelmed by the pace of change & veracity of options is not a consideration. We must keep sanity levels in check and maintain meaningful traction. At Tervis, our Technology mindset is always in three places:
1) Honoring what is required, by virtue of industry standards or consumer expectations.
2) Supporting and protecting what makes our unique business hum. Accepting that even the coolest, most compelling industry trends may not fit our exact business is a very freeing exercise. It ensures we have the reserves to focus in on our core & expanding differentiators, making them that much more difficult to be mimicked.
3) Playing with the abstract, the more “thought”, not quite “thing” concepts. We need to keep some bandwidth for the conceptual pipeline.
Emerging Technology Trends
Perhaps the most exciting trend is the evolving role of the Technology unit in retail organizations. IT is breaking free of its previously locked state of Technology managers and is now a highly integral, strategic business partner – newly reformed to be more customer/consumer-led as opposed to just operations led. This is largely driven by the “omni-channel” movement, requiring previously designated back-end functions to pull ahead, take greater accountability in objective and opportunity definition. IT is now engaged at the start of these conversations, not after a need has been defined and a strategy articulated. No longer regarded as a means to keep the lights on, IT has a seat at the table to create new sources of light to draw & attract around the clock. This well-rounded evolution is enabling much richer, more meaningful retail experiences that more closely deliver against objectives, if not surpass them. The most “needed” trend is Consumer Privacy Protection.
“Technology providers need to identify other complementary providers that integrate well and add incremental, non-redundant value to their core offerings”
eCommerce got off to the slow start that it did in the early years due to consumers’ concerns over the security of their information. Yet, here we are 15+ years later and it’s still very much an issue, but on a much larger stage. The breaches of 2013 & 2014 have exploited the vulnerabilities of retailers, and while some mayhem has ensued, it’s forcing much needed retailer responsibility in protecting their number one asset: the customer’s trust. It’s served as the wake-up call this industry desperately needed. Despite often being competitors to one another, this is where we need to be unconditional partners to ensure all have heard the alarm.