One in four retailers slow to adopt new technologies
Stores, both physical and online, need to adopt four key strategies for a more complete customer experience
Traditional stores and online channels alike are committing to significant IT investment as they both create and respond to changes in customer behaviour.
The surge towards more personalised customer interactions means increasing adoption of technologies and platforms such as IoT, cloud and Big Data, although a new report from Vertiv shows one in four retailers are still slow to adopt these new technologies and integrate them across operations.
CUSTOMER ENGAGEMENT IS CRITICAL
A seamless shopping experience is no longer a "nice to have", but an imperative.
And it is a key reason why retailers worldwide are heavily investing in online and digital to improve customer engagement.
In Singapore, the government has recognised the importance of this trend with its Infocomm Media Sector Industry Transformation Map.
Launched in November 2017, the plan incorporates several ecosystem-wide projects, the first of which will turn the Malay heritage site of Kampong Glam into a test bed for retail digitalisation at the neighbourhood level.
NEED TO INTEGRATE TECHNOLOGIES
The Vertiv/DCD study found that the walls of siloed operations supporting physical stores, distribution centres and online retail channels are being broken down, facilitating the aggregation and analysis of data found within them.
This is helping drive a customer-directed transformation of the organisation.
As the process moves forward, there is a shift from using technology primarily to cut costs, automate processes and provide better management of the supply chain, towards enhancing a well-defined and seamless customer experience.
Once integration is firmly established, retailers are able to find and put to use the mass of data held within their organisation far faster, allowing the constant refinement of the customer experience.
INCREASE IN DISTRIBUTION CENTRES AND WAREHOUSES
The key driver for IT investment by retailers is the growth in online commerce.
Over the next two years, the amount of data centre space dedicated to online retail - both on-premise and collocation - is expected to increase by 20 per cent, with cloud hosting increasing by 33 per cent to support store applications.
An important part of the retail digital evolution includes a massive transformation of distribution centres.
The research suggests the number of distribution centres and warehouses will increase by about 26 per cent over the next two years as retail companies increasingly realign operations to meet consumer demand for online purchasing.
The amount of data centre space dedicated to distribution/logistics is expected to increase by 10 per cent and the use of cloud hosting to support distribution will increase by 87 per cent.
FUTURE DATA CENTRE STRATEGY STILL EVOLVING
The report predicts that the adoption of collocation and cloud hosting will increase.
Retailers are moving more computing power into stores to support edge computing types of applications that communicate with customers and influence them closer to the point of decision.
Ultimately, the goal for today's retailers is to move the organisation and its use of technology beyond selling products and services, extend its brands through the use of experiential technologies, and deploy tools that can rapidly find and analyse data in order to support a more engaging customer experience in real time.
The writer is Vice-President, South-east Asia, at Vertiv, an American provider of equipment and services for data centres.