Top 10 Retail Technology Investments in 2017

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Top 10 Retail Technology Investments in 2017

By Joe Skorupa - 04/13/2017

The just released RIS/Gartner Retail Technology Study validates three dynamic shifts in retail are taking place in 2017 – unified commerce, personalized marketing and customer engagement. By tracking 83 separate technologies and ranking them by highest level of investment interest, the study’s Top 10 Technologies for 2017 list reveals that complex, multi-year strategies are driving the bulk of current retailer investment dollars.

The Top 10 Technologies for 2017 list appears in the 27th Annual Retail Technology Study, “Reconnecting with the Consumer,” which can be downloaded by clicking here.

How to Analyze the Data

One primary mission of the study is to track retail solutions that large regional and national retailers most frequently use in their day-to-day businesses. This is analyzed from two key perspectives: 1. Measuring the current up-do-date install base to pinpoint what is and what is not commonly used in retail; and 2. Short-term and long-term purchase plans to show what solutions retailers are investing in to achieve their strategic goals.

The study applies this approach to 83 specific solutions covering such major categories as store technologies, POS/checkout, analytics, merchandising management, supply chain, workforce management and e-commerce.

One way for retailers to determine if a retailer’s tech stack is leading, competitive or lagging is to compare their organization to the benchmark average of the industry. So, for example, if 48% of retailers say they have up-to-date warehouse management software in place and another 16% are in the process of updating, then this should be considered a mainstream technology or a necessity that every retailer should continually update.

If, however, 6% of retailers have up-to-date self-checkout terminals in place and another 6% say they are currently updating them, then this is a niche technology or one that is probably not well suited for mainstream adoption. If self-checkout were new it might be viewed as emerging instead of niche, but since it has been around for many years the data shows it is not a priority item on every retailer’s checklist.

Analyzing the Top 10 Technologies for 2017 List

As noted, the Top Technologies for 2017 List was created by tracking 83 separate technologies and ranking them by highest level of retailer investment plans within the calendar year. This is a hard-number analysis that is created by the combination of two datapoints tracked for all 83 technologies: 1. started but not yet finished a major upgrade, and 2. will start a major upgrade within 12 months. (Note: Since the survey is filled out in late December and early January the 12-month time period encompasses the 2017 calendar year.)

The category “started but not finished a major upgrade” refers to retailers who are currently working on a new implementation or a major upgrade of existing technology. Investment dollars are clearly flowing into technology that falls into this category because work is currently being performed.

The category “will start a major upgrade within 12 months” refers to retailers who plan to begin the implementation within calendar year 2017 based on the time frame the survey was taken.

Large regional and national retailers go through a budget approval process that requires C-level and board approval of capital investment plans. The approval process requires a significant amount of preparation by the IT department. No major technology project can be done within a calendar year without this prep work being done and approvals securely in place. Retailers who reach this late stage in the process can be counted on to continue rolling out the project with a high degree of certainty.  

By combining the categories “started but not finished a major upgrade” and “will start a major upgrade within 12 months” a picture emerges of capital investment dollars flowing into 83 specific retail technologies within the 2017 calendar year. When stack ranked from highest to lowest a top-10 list appears.

Top 10 Technologies for 2017

  1. Multi-channel frequent shopper tracking
  2. CMR/Personalization
  3. EMV compliance
  4. Multi-channel customer behavioral segmentation
  5. Campaign analysis and forecasting
  6. Mobile POS*
  7. Real-time store monitoring KPIs*
  8. Recruitment and on-boarding*
  9. Social media analytics
  10. Mobile workforce and HR management*

*New. Did not appear on 2016 list

The list shows a focus on unified commerce (multi-channel shopper tracking and multi-channel behavioral segmentation), personalized marketing (CRM/personalization and campaign analysis and forecasting) and customer engagement (social media analytics and both of the previously cited personalized marketing technologies).

However, the list is also interesting for another major focus – the store (mobile POS, real-time store monitoring KPIs, recruitment and onboarding associates, and mobile workforce and HR management).  

As Bob Hetu, research director with Gartner and the principal analyst for this study notes, retailers demonstrate a major emphasis in 2017 for answering the question “What can we do with stores.” After a rash of closing announcements in the headlines, "it’s a good reminder for multichannel retailers that stores are a point of differentiation,” says Hetu.

To download the study to see the complete list of charts and analysis click here.

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