Would you cross the street based on yesterday’s traffic information? Of course not!
Well that is essentially the risk that retailers are taking by making decisions based on old information – batched sales from yesterday or last week. Ok, it’s a little overdramatic, but you get my point.
As you know, customers are becoming more demanding – driven by new technology and the real-time capabilities it enables. A customer can be shopping at a store for a specific model of computer and she can take a photo of it and get instant access to the best prices from multiple competitors and the closest store that has it in stock – in real-time.
Consumers expect a seamless experience in the store, on the Web or anywhere customers choose to shop. This is why “real-time retail” is the new imperative. Unfortunately, most retailers don’t have real-time retail capabilities today.
What is Real-time Retail?
When a customer walks in your door, do you know who she is? Do you know what she abandoned in her online shopping cart this morning? Do you know that she looked at your daily specials on her smartphone 30 minutes ago? Can you see current inventory at your store and all other stores and distribution centers in your chain – in real-time? These capabilities are examples of real-time retail in action.
BRP Definition of Real-time Retail:
Real-time Retail – Delivering a seamless experience to consumers whenever, wherever or however they choose to shop by gathering, analyzing and disseminating customer, product, pricing and inventory data across all channels – in real-time.
What industries have embraced real-time retail?
Banking was the first industry to capitalize on the power of networks to enhance the customer experience with real-time retail. Until the 1970’s banking required personnel to handle a transaction, but everything changed with the development and utilization of automated teller machines (ATMs) supported by a robust and redundant network. When ATMs were tied into systems, it facilitated access to, and transfer of, real-time cardholder account information. Today, consumers can get cash, deposit checks and conduct nearly all their banking whenever and wherever they want – in real-time.
Why don’t all Retailers have Real-time Retail?
The simple answer is that it is the road less traveled. Very few people really want to risk their career on innovation, especially when it is a complex undertaking. While the technology is readily available, most retailers are saddled with legacy systems that are not conducive to massive real-time read/write demands. Integrating numerous systems together to work in near real-time is even a daunting proposition. And the time and cost to do a total systems rip and replace is not usually an option.
Developing a strategy and roadmap for real-time retail is now an imperative for success. For established retailers with legacy systems, the only feasible approach is to prioritize the most critical real-time capabilities and start there first
The Problem is that Infrastructure has no “home!”
No department in the retail organization is willing to invest in infrastructure. While all departments require, and indirectly benefit from, a strong infrastructure, projects to improve technology infrastructure rarely gets allocated budget funding. Why? Because it is hard to demonstrate the ROI and there are a lot of other projects with quick payback that get funded instead. Just as railroad projects in the 1800s and highway projects in the 1900s were funded without a tangible ROI, infrastructure projects need to be justified in the same manner – because “it is the right thing to do.”
What do Leading Retailers Think about Real-time Retail?
To get feedback from retail industry experts, I recently moderated a lively workshop session on “Real-time Retail: It’s What Customers Demand” at the RetailConnections Omnichannel Retail Executive Forum in New York. Check out the Workshop Recap of the ideas and comments debated and discussed in this session, including:
- Real-time Retail
- Personalized Selling
- Interactive CRM
- Monitor & React
- Task Management
- Nimble Execution
Why will Retailers move on this?
Once retailers have the infrastructure in place, they will follow the money. Historically, IT expenses are 60% hardware, 20% software and 20% services. With a robust infrastructure that requires minimal/thin hardware, it will take almost half the costs out of projects and be extremely cost effective to achieve real-time retail capabilities. It will be an easy decision!
Real-time retail is becoming a mantra in the retail industry and is a key focus area for most of our clients.
I would love to hear your thoughts on this topic and any examples of retailers having success with real-time retail.
Please share your comments below.