MOBILITY SPECIAL REPORT
Mobile POS races to the bottom, customer service apps reign supreme, and BYOD begins to make perfect sense.
If retail mobile adoption stats are any indication, there’s a stout infrastructure of mobile devices, applications, and the networks that support them in retail. Our annual survey of retail tech buying decisions revealed that for the first time ever, retailers plan to spend as much on mobile hardware and software applications as they do on traditional fixed retail systems in 2014. The applications those mobile devices will support are many and far reaching — from inventory management to POS to clienteling and a host of other customer experience enabling apps.
Still, mobile adoption and mobile execution are two entirely different things. Mobile is pervasive; that’s lost on no one. But is it effective? How? What’s the quickest path to mobile device deployment success and ROI? Rather than go long on the plans of your retail peers to plug mobile devices into their retail systems infrastructures, this report will seek to identify where early adopters have stumbled, why, and how you can avoid the same mistakes. We’ll also discuss mobile trends such as bring your own device (BYOD), how machine to machine (M2M) and geolocation are bridging the gap between enterprise and consumer mobility, and how these trends can either fuel your initiatives or bring them down in flames.
Omni-channel is evolving and maturing. Retailers are turning from envisioning the future of digitalenabled shopping toward making that vision a reality. However, for all the work that has been done, one particular function of the retail business has been held apart: the supply chain.
Changing the supply chain is time consuming, resource intensive, expensive, and risky. And though most retailers have grappled with how digitallyenabled consumer shopping behaviors are changing, most have responded with a thin layer of omni-channel veneer and a supply chain unchanged — isolated and protected at all costs.
Like a pressure cooker locked down too tight, however, the forces acting on supply chain are only building greater pressure, from shifting consumer behaviors to demands for omni-channel service. And those forces won’t be easing up anytime soon. While the retail supply chain has been designed and refined to serve one channel only — stores — most retailers are looking to other channels, digital channels that only increase retailers’ need to become more seamlessly omni-channel, like mobile.
TECH SPENDING 2014
2014 retail technology budgets are strongly influenced by consumers’ newfound control of where, when, and how they shop — and how much they pay.
Retail technology budget building isn’t what it used to be. Not long ago, technology spending decisions traced a direct path from CIO to CFO to the board of directors. Today, these decisions are being driven by a much larger board of consumers, pushed down to the CMO who answers to that board and implemented with the blessing of the CFO and the assistance of the CIO. The consumer is calling the shots, and the newly empowered CMO is listening.
Our 2014 tech spending forecast illustrates this changing dynamic, driven in some cases by fear of — and in other cases the opportunity presented by — consumer control.
SMALL TO MIDSIZE RETAILING
Small to midsize retailers (SMRs) face the same challenges as the big retailers, but with much fewer resources. See where they focus these resources to maximize sales and growth.
Retail is all about the customer and sales. Unfortunately, when people talk about retail, they think only of the big-box retailers such as Walmart, Best Buy, and Target. These companies, along with Amazon and every other large retailer, definitely are a driver of retail, but the real drivers are the small and midsize retailers (SMRs), such as bohme, bebe, and all of the mom and pop stores out there.
According to the U.S. Census Bureau, there are more than 4 million retailers in America, employing nearly 45 million people full and part time, both directly and through associated businesses. According to the National Retail Federation (NRF), retail supports nearly one in four American jobs. Whether it is through manufacturing, distribution, transportation, or working directly for a retailer, the economic impact of retail cannot be denied.
E-COMMERCE SPECIAL REPORT
E-commerce has become much more than just a channel. It is an integral part of a complete retail business and the fastest-growing part of the business.
No channel of retail is growing faster than e-commerce. But e-commerce is much more than just a website; it is a global influencer of retail sales across all channels. Nowhere is this more evident than in the increased use of smartphones and mobile shopping by consumers. Consumers are changing how they shop and how they prefer to interact with retail brands, and retailers need to pay attention. Retailers’ e-commerce strategies can either enhance this relationship and increase sales, or it can damage that relationship and destroy a brand.
Loss prevention professionals' duties are undergoing a massive shift as retailers deploy new technologies, and criminals follow suit.
We all know how retail has changed with the emergence of omni-channel retailing and mobility. However, something that has been somewhat overlooked as stores are renovated, new e-commerce and m-commerce sites are built, and mobile devices are deployed in stores is the effect on loss prevention.
Internal and external shrink numbers have always fluctuated, but with the rise in organized retail crime (ORC) and advancements in the technologies they use, LP professionals are being forced into a whole new world.
Mobile devices are making their way into all aspects of retail, from consumers to associates and managers. This is causing a shift in everything from online marketing to workforce management.
Mobility has impacted retail like no other technology except for the Internet. The technology is rapidly being embraced by retailers, associates, and customers at a rate previously unseen in the world of retail, where new technologies are normally slow to make it to the mainstream. Even e-commerce was not as readily adopted by traditional retailers, with many entering the market late and having to play catch-up. It appears these same retailers have learned their lesson when it comes to mobile technology adoption.
E-Commerce has grown to more than 5 percent of all retail transactions, according to the U.S. Department of Commerce, and it is continuing to grow. The fastest growing segment of e-commerce is mobile commerce (m-commerce), as consumers become more comfortable making purchases on mobile devices with smartphone penetration exceeding 50 percent of the market. Mobility offers a unique market for retailers to reach customers, but it is also causing headaches when it comes to “showrooming” and customers having more data than associates.
PAYMENT SECURITY/PCI SPECIAL REPORT
Payment security is a responsibility shared by retailers, vendors, acquirers, and processors — all working to secure card data as it’s being accepted, processed, transmitted, and stored.
Recent industry reports underscore retail as the hottest target sector for stealing valuable payment card information. And according to Trustwave’s 2013 Global Security Report, 63% of the breaches investigated in 2012 were a result of security vulnerabilities introduced by a third party responsible for system support, development, and/or maintenance of business environments. Verizon noted similar findings in its recent breach report. These vulnerabilities often come by adding or reconfiguring a new system, new software, or through other integration failures. One seen most often is a very simple one — not changing factory default passwords in added system components — leaving you open to a vulnerability you may not even be aware exists.
CMO SPECIAL REPORT
Today’s CMO is being called upon to break down the barriers within the retail business structure and work directly with the entire C-level to create a single direction for the company.
Marketing, and specifically the role of the CMO, has really moved from being an operational function (buying advertising, hosting events, setting brand standards) into a highly strategic and valued one. While some studies still point to skepticism from the CEO on the value of the CMO, our members tell us that their level of access, partnership, and engagement with the CEO has dramatically changed and improved as their role has evolved. Now that it is standard operating procedure for the CMO to speak in the language of the business, to lead with data and to report measures, and to define where and how marketing has translated the brand into business, there is a new level of respect and responsibility. I think we will see this continue. As marketing continues to own the customer experience and be the keeper of customer intelligence and engagement, marketing will continue to grow in importance.
ANNUAL LOSS PREVENTION GUIDE
How Loss Prevention And Asset Protection Are Leveraging Big Data
Retailers are collaborating to fight the rising level of retail crime through LP/AP organizations and by leveraging the huge amount of data new LP/AP technologies supply to benefit operations, sales, and the bottom line. See how the latest technologies are enabling this in The Annual Resource Guide To Loss Prevention.
Technology And Cooperation Are The New Driving Forces Behind Loss Prevention
The new LP/AP professional works together not only with other LP/AP professionals, but also with every department in their organization to leverage new technologies and impact the retailer’s bottom line.
WFM SPECIAL REPORT
As workforce management continues to evolve, retailers are using Big Data to leverage WFM/HCM solutions to enhance the customer experience and drive sales.
Workforce management (WFM) and human capital management (HCM) have taken a prominent role in retail as companies struggle with increased competition, a sluggish economy, slow growth, and slim margins. Along with inventory, labor is one of the top cost factors for retailers, but the introduction of Big Data and a renewed focus on the customer experience is leading retailers to look at labor and WFM as a profit center to drive sales. In May 2011, we featured our inaugural Special Report on WFM. This report covered time and attendance, onboarding, and other functions. In 2012, our report focused on moving from just time and attendance to store operations. This year we will be focusing on Big Data and how WFM/HCM are being used to drive bottom line profitability.
Retailers have come to realize the channel customers use to make purchases does not matter, because it is impossible to track all of the sale influencers. What really matters is consistency across the brand to capture that sale no matter where the customer is.
There is no denying retail has been forever changed by e-commerce. It is the fastest-growing channel with retail, and it is where retailers see the most potential to gain market share. However, retailers are struggling to integrate e-commerce with their other channels to create a seamless omni-channel experience for the customer. Shoppers are becoming increasingly comfortable shopping across all channels. In PwC’s recent report, “Demystifying The Online Shopper,” global retail and consumer leader John Maxwell notes that online shopping varies by country and region. “In China, for example, 70% of our survey respondents shopped online at least once a week, compared with about 40% in the U.S. and the U.K., and around 20% for the Netherlands, France, and Switzerland,” Maxwell notes.