Many retailers continue to struggle to keep up with the disruptions that digital natives have brought to the industry. Companies such as Amazon introduced recommendation engines and rating systems. And in the last decade, the iPhone and Android mobile devices have put even more power into consumers' pockets. Shoppers can be in one physical retail location and search for a better deal elsewhere using their smart phones.
The world is shifting underneath retailers' feet. And more is yet to come. At the National Retail Federation event in New York (January 15 through 17) technology vendors are be showcasing some of the most cutting edge technologies for retailers, including chatbots, artificial intelligence, augmented and virtual reality, and more. Are retailers ready?
It depends. There's really a range of experiences across companies. Analytics can offer retailers value across many aspects of their businesses, from supply chain optimization to workforce management to understanding consumer behavior.
Yet many retailers are still struggling to get their siloed data integrated. It's one thing to offer a retail app to your customers if you've been a brick-and-mortar retailer. It is a more daunting challenge to integrate customer data from mobile apps, the web, physical stores, catalogs, social media, and any other channels to create a comprehensive picture of consumer behavior that can inform your own business decisions.
What's more, digital native retailers have changed the competitive playing field, leaving older brands struggling to keep up with the challenges of just getting up to speed with advanced analytics, according to Brian Kilcourse, managing partner at RSR Research, a technology consultancy for retailers and the former CIO of retailer Longs Drugs.
"Most retailers continue to implement the last wave," Kilcourse told InformationWeek in an interview. Retail systems have been distributed for many years because the center of all activity was at the store, he said. The original networks implemented in the 1980s and 1990s were primitive.
"When the central office went down, no one would notice for five days," he said, and that was when it came time to cut paychecks for store employees.
Yet the new technologies on display at this year's NRF will be pretty compelling, according to Kilcourse.
"The big push this year will be all about AI," Kilcourse said. He pointed to offerings IBM is putting together with its Watson AI platform together with contributions from its Weather Company acquisition, as an example. The combination is something that retailers may be able to use to leverage insights about the impact of weather on supply chain issues and store sales, for instance, and ultimately provide better predictive insights.
"AI is going to be making its case," he said. "That is probably going to be the big thing and the biggest thing to pay attention to as it relates to business intelligence."