By Rick Moss
A new study conducted by RIS News, along with Gartner, and sponsored by Lawson Software, indicates a retail community that is broadly re-energized in many areas of retail technology development. In one portion of the survey, retailers voice a newfound commitment to invest technology funds to get them closer to the customer.
When asked how they can best grow their businesses, 43 percent of retailers surveyed see changing their value proposition to consumers as most important, versus 33 percent who would grow through the building of new stores, and 13 percent through acquisition. Said Andrew Gaffney, group publisher, RIS News, "Retailers are discovering that using technology to keep customers' loyalty and meet their increasingly sophisticated demands is a helping them stay competitive."
Other survey results show that retailers' primary concern is on improving service for the time-starved customer:
- In the next 2 years, 60 percent of the retailers plan to use knowledge management software solutions to make personalized customer data available to store personnel.
- Sixty-three percent will improve their loyalty program data analysis to flag "best" customers and their likes and product preferences.
- As a result, more than one-third of retailers will have behavior analysis projects underway by year's end to pinpoint improving customer relationships.
On the challenge of how to capitalize on the mountains of data generated by frequent shopper programs, most respondents seemed to be making solid moves toward data warehousing and analytics implementations.
- Eighty-two percent of retailers (sales of $1 billion or greater) have or will implement data warehousing by the end of this year.
- Sixty-two percent of retailers will implement business analytics programs by 2005.
The survey respondents were 221 senior retail executives from a cross-section of retail segments. Fifty-one percent of the respondents have C-level or VP titles. Twenty-three percent of the sample is over $1 billion in annual sales revenue; 8 percent between $500 to $1 billion; 11 percent between 250 and 500 million; 16 percent between 50-250 million and 42 percent under $50 million.
Moderator's Comment: It sounds like these retailers are "stoked". Are we on the verge of a golden age of retail technology?
Granted, this news release from the researchers and sponsor is somewhat partisan. The title almost gave me goosebumps: "Retailers Embrace Technology and Increase IT Spending as a Competitive Differentiator; Enthusiasm for Technology Seen as Shift toward Retail Renaissance." But we do seem to have turned a corner. While the media seems to be unable to shake their post-bubble, luddite mood, savvy retailers have honed their techno-strategies and have learned much about where to invest effectively. So yes…I do believe we may soon be actually seeing some revolutionary results from all this amazing number-crunching, and the consumer will be the greatest beneficiary. [Rick Moss - Moderator]