6 things retail CIOs need to keep in mind in 2017
- 05 January, 2017 01:27
According to Forrester, U.S. online holiday sales will total more than $100 billion in 2016, a growth of 13 percent since last year. This will result in a major milestone: Shoppers will spend an equal amount online vs. in stores, predicts the 2016 Deloitte holiday shopping survey. As retailers seek to compete in this fast-moving, ever-evolving digital space, as well as use technology to take brick-and-mortar to the next level on the shelves, throughout the supply chain and at the point of sale, CIOs have a great deal on their plate.
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Technology investments and plans are already in place for this holiday season, of course — and CIOs will now get to see how last year’s efforts perform, says Walgreens CIO Abhi Dhar. “All of our work gets tested in a time-pressed period,” he says. “It provides active learning and feedback that we can build upon.” But soon enough, CIOs will take those learnings and turn to making their 2017 plans. These are six important areas they should keep in mind after the holidays wind down:
1. Think mobile ... first.
CIOs who help their retail organization to think “mobile first” will win in the coming year, says Fiona Swerdlow, vice president at Forrester and author of the 2017 Retail Predicts Report. That’s because mobile use is growing by leaps and bounds — as an example, consumers spent an average of 126 minutes on their mobile phone every day in 2015, double the time spent just two years earlier.
Successful retailers will design their offerings around how customers use their devices and the retailer’s app or mobile site. “For starters, retailers need to have a consistent cart across devices, which is not easy because the consumer is not always logged in,” says Swerdlow. In addition, consumers increasingly expect that when they look at something on their smartphone while in the store, they will be find relevant information, ratings and reviews.
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2. The checkout experience is key
When it comes to brick-and-mortar, CIOs need to help retailers drill down on improving the checkout experience, including POS promotions and in-store fulfillment, says Walgreens CIO Abhi Dhar. “This is what makes brick-and-mortar stand out — it all comes down to creating lasting experiences for our customers,” he says, noting the investments Walgreens has made in its new ship-to-store offering; making checkout with EMV chips faster and easier; as well as easy ways to associate coupons at the point of sale. “In 2017, you’ll continue to see Walgreens increasingly focus on technologies that help retailers communicate, connect and engage with customers in exciting new ways.”
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3. Be on the lookout for digital talent
As online sales boom, mobile digital talent will be in short supply, cautions Forrester’s Swerdlow. Many retailers will need to tap their partner network for digital resources, combining them with in-house capabilities. Also, digital executives will have to be groomed for broader roles, not just the ecommerce team — digital needs, after all, now pervade the entire organization. “CIOs know this challenge well in finding experienced digital developers and engineers for their own teams, particularly in mobile.” she says. “But they have to help the organization step up or risk losing that talent to other retailers eager to nab them, or startups seeking to pick them off.”
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4. Get serious about IoT security
IoT adoption continues to progress, but in 2017, CIOs will have to future-proof their security posture as the potential for unwanted users or cybercriminals to infiltrate retail increases, says Sam Elliott, director of security product management at Bomgar, a remote software vendor. “One of the greatest challenges for retail CIOs when it comes to IoT is determining who is responsible for securing, maintaining and patching the various technologies.”
Devices are often overlooked because they fall outside of ITs traditional purview, he adds, while retailers may be unaware the security responsibility lies with them, leading to a scenario in which the device ends up on a vulnerability database and is quickly exploited. In other instances, updates might be maintained by a vendor or another third party who has access to the company’s system. “Even if a device meets some definition of security, the question of who owns it and who has access to it remains a security nightmare,” he says.
5. Collect accurate and timely data
This holiday season, it’s crucial for retailers to collect accurate and timely data that can be analyzed to better manage store operations, as well as leveraged to improve sales and the shopper experience, says Tony D’Onofrio, chief customer officer of Tyco Retail Solutions. CIOs, he explains, must ensure that the data is delivered through the right vehicle at the right time, and targeted to the appropriate decision makers and customer-facing employees. “In today’s challenging retail environment, consumers are demanding merchandise where and when they want it, particularly with complex multichannel fulfillment options that can only be enabled through accurate and real-time inventory visibility,” he says.
The retail CIO needs to be laser-focused on ensuring the accuracy and timely delivery of the inventory and sales data to all stakeholders in the business — to empower managers and sales associates to best maximize their business, achieve the highest inventory ROI, and most importantly, fulfill their customer's’ expectations and needs while in-store and online.
6. The year of the API
APIs have revolutionized industries from music to transportation, with apps such as Uber, Google Maps and Pandora, says Jeff McCandless, CEO of Project44, a supply chain technology provider with a special focus on retailers and manufacturers. 2017, he adds, may be the year of the API for retail, which still lags behind in its understanding and implementation of APIs — but is starting to catch on.
“Retail CIOs will have to understand the impact this technology has on inventory optimization, setting – and meeting – customer delivery expectations, adhering to the demands of today’s always-on consumer and driving real-time visibility across the entire supply chain network,” he says. “Web-service APIs empower retailers to compete in the new on-demand reality by delivering goods in the shortest timeframe possible with the highest level of transparency and operational efficiency.”