The National Retail Federation 2018 Big Show conference and exhibition in New York City last month produced few real surprises for those of us who closely follow retail technology.
There were a few key takeaways, but arguably little in the way of brand-new innovation. It was cool to see the Starship delivery robot, some robots for in-store, see the ability to try a new shade of lipstick, and look at some very cool smart shelves that changed the message as you got closer (see image). However, I did not see these as particularly new or innovative.
What I did find interesting was a piece written by Nikki Baird at RSR after the event. Her perspective on new innovation was similar to mine but she did observe that the best innovation came from connecting technologies together.
To benefit from this innovation, Nikki said retailers need to adopt a flexible platform. This will allow multiple systems and things to be brought together, but she said: “Most retailers don’t have that. And if they do, it’s fragile, hard-coded integration that will be rendered obsolete by the next upgrade cycle.”
I was intrigued again when George Lawrie of Forrester made similar comments about ecosystems of retail applications working together.
Retailers “differentiate through process and experience, so they are reluctant to consign all their applications to a single vendor,” he said. “They have to experiment with point solutions and in-store gadgets, but face challenges to scale and integrate the winners into their legacy enterprise stack.”
I found this very interesting because connecting new technologies to the existing infrastructure is exactly what Software AG has been helping the world’s most progressive retailers with for many years.
Some other takeaways are below:
Ecommerce is Dead
Well, not really. The reality is that the boundaries between physical and digital retail are fuzzier than ever. 56% of the retail sales are influenced by digital channels. Personally I am surprised it is as low as this. I am proud to say that Software AG powers ecommerce and omni-channel sales for the biggest and best names in omni-channel retail. There is still work to do, however; recent research shows that while 91% of retailers have an omni-channel strategy or are planning to invest in the technology in the near term, only 8% feel they have mastered it.
AI is Ready for Bigtime
Retailers have used predictive analytics for over 20 years to determine sales, plan pricing and space allocation. But there was a lot of use of the term AI from many vendors – but also retailers themselves around operational decisions. Whether this is ‘spin’ is not clear – however momentum is growing and Software AG incorporated Zementis into the Digital Business Platform for exactly that reason.
Stores are Far From Dead
We all know about stores closing but what struck me was how much tech was on display for use inside stores. The biggest feature here was POS devices – from SO MANY vendors (more than I have ever seen before), driven by the need to replace to ensure that propositions like BOPIS (buy online pick-up in-store) can be operated. It also expanded to in-store robots for checking shelf stocks and planogram compliance. Adding lots of new technology – even something as seemingly standard as a new POS – needs the ability to align it to the rest of the ecosystem, otherwise the BOPIS promise cannot be fulfilled.
In conclusion, it really feels that, for retailers, consensus is gathering; the need to bring together their systems into a solid ecosystem – defined by Gartner as “a system of systems” – is becoming more and more critical. Gartner also said: “The purpose of digital business is wholly focused on delivering a modern, differentiated consumer experience” and the retailers that capitalize on this are most likely to be the winners.
Find out more of what Software AG is doing to help the world’s best retailers by clicking below.