Executive Briefings

Retail, So in Need of Innovative Technology, Is Said to Be Slow to Make IT Investment

Retailers generally have a reputation for being slow to embrace the latest innovations in technology. According to data from the U.S. Census Bureau, the retail industry as a whole spends far less on technology than nearly all other service sectors.

Interestingly enough, one of the key reasons that retailers are slow to adopt new technology is that their existing technology infrastructures – the hardware and software systems that form the backbone of their IT operations – limit their ability to roll out promising new technologies. Retail Systems Research's 2013 Merchandising Benchmark report underscores this point: "Forty-five percent of retail winners believe their existing technology infrastructure is preventing them from moving forward."

Big Data and analytics, currently the rage in many industries, provides a prime example. E-tailers such as Amazon and Netflix pioneered Big Data and other analytics techniques during the last decade. But a recent research report from EKN, Big Data in Retail, points out that retailers in general spent less than half of 1 percent of their entire IT budget on Big Data projects in 2013. Moreover, they lack even the basic analytic maturity that is required to take advantage of Big Data insights: only 60 percent of retailers are able to perform even basic analysis and reporting tasks.

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Interestingly enough, one of the key reasons that retailers are slow to adopt new technology is that their existing technology infrastructures – the hardware and software systems that form the backbone of their IT operations – limit their ability to roll out promising new technologies. Retail Systems Research's 2013 Merchandising Benchmark report underscores this point: "Forty-five percent of retail winners believe their existing technology infrastructure is preventing them from moving forward."

Big Data and analytics, currently the rage in many industries, provides a prime example. E-tailers such as Amazon and Netflix pioneered Big Data and other analytics techniques during the last decade. But a recent research report from EKN, Big Data in Retail, points out that retailers in general spent less than half of 1 percent of their entire IT budget on Big Data projects in 2013. Moreover, they lack even the basic analytic maturity that is required to take advantage of Big Data insights: only 60 percent of retailers are able to perform even basic analysis and reporting tasks.

Read Full Article