Retailers Buying Into IT - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Hardware & Infrastructure

Retailers Buying Into IT

This year's top expenditures, AMR Research says: supply-chain improvements and better store systems and planning applications. Next year will bring more in the way of self-service and other areas.

Retailers are dipping into their tills and bumping up spending on IT. Analysts expect three areas to see the most benefit: self-service processes, mobile technology, and promotional and merchandising tools, according to a report Wednesday by AMR Research Inc.

IT spending by retailers rose to 2.9 percent in 2005 as a percentage of company revenue from 2.5 percent in 2004, and overall technology budgets are expected to increase by 3 percent in 2006, according to AMR.

Eighty percent of retailers report that the Sarbanes-Oxley Act (SOX) and it attendant compliance issues are the driving force behind the increases in IT spending.

For retail this year, the focus has been on technology that affects top-line performance and the consumer experience. That means better store systems, and better planning applications, and supply chain capabilities. There are three major investment areas for retailers next year.

"Expect to see increased penetration of self-service kiosks and self-checkout devices," said Scott Langdoc, vice president of retail systems, AMR Research Inc. on Thursday. "You also can expect more mobile technology available to store associates to create a more pervasively interactive relationship between the store associate and the consumer."

Retailers also will focus more on promotion and merchandising strategies, Langdoc said. About 29 percent of retailers plan to upgrade their current store software. Specific investments are likely to include applications that improve processes such as inventory and replenishment, point of sale (POS) systems, distributed order management, workforce and task management, and customer loyalty programs.

Vendors are aligning their product lines to improve functions in software, hardware, and services to match the demands of retailers. The applications market for the retail industry this year is expected to rise 10 percent from 2004 to $6.6 billion, with application license revenue accounting for $2.2 billion. The investments are going into consumer-centric technology to help drive top-line revenue and margin improvements.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Previous
1 of 2
Next
Comment  | 
Print  | 
More Insights
State of the Cloud
State of the Cloud
Cloud has drastically changed how IT organizations consume and deploy services in the digital age. This research report will delve into public, private and hybrid cloud adoption trends, with a special focus on infrastructure as a service and its role in the enterprise. Find out the challenges organizations are experiencing, and the technologies and strategies they are using to manage and mitigate those challenges today.
Commentary
Future IT Teams Will Include More Non-Traditional Members
Lisa Morgan, Freelance Writer,  4/1/2020
News
COVID-19: Using Data to Map Infections, Hospital Beds, and More
Jessica Davis, Senior Editor, Enterprise Apps,  3/25/2020
Commentary
Enterprise Guide to Robotic Process Automation
Cathleen Gagne, Managing Editor, InformationWeek,  3/23/2020
Register for InformationWeek Newsletters
Video
Current Issue
IT Careers: Tech Drives Constant Change
Advances in information technology and management concepts mean that IT professionals must update their skill sets, even their career goals on an almost yearly basis. In this IT Trend Report, experts share advice on how IT pros can keep up with this every-changing job market. Read it today!
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll