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22pc of retailers will integrate beacons this year: study

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January 14, 2015

Beacons are expected to boom in 2015

Beacons are expected to boom in 2015

NEW YORK – IHL Consulting Groups and RIS News executives at the NRF 104th Annual Convention & Expo said that while a good percentage of retailers currently have up-to-date POS software systems, emerging technologies that retailers will focus on over the next 12 months will likely be beacons, predictive analytics and EMV.

At the “2015 IT Forecast – Key Takeaways and Findings” session during the NRF 104th Annual Convention & Expo, the executives discussed findings from the 12th Annual Store Systems Study 2015 that looks at retail technology spend trends and completed and compiled by IHL and RIS News. While the store is a key focal point in the study, there is a continued push to viewing the entire experience as omnichannel, but ultimately, these things take time.

“The stuff we talk about at NRF takes three years before we see it,” said Greg Buzek, president of IHL Consulting Group. “We hear it’s coming, we’re going to get there, but it’s not there yet.

“On average, it takes one year after purchase decision for deployment time, and by the time deployment occurs, you’re behind,” he said. “Putting tablets in stores is an example.”

Now, and tomorrow
Mobile holiday sales were up 50 percent this year, and Mr. Buzek believes that consumers spent Thanksgiving Day by watching football or eating turkey while browsing deals and shopping on their smartphones.

Meanwhile, there has been a year-over-year store count and remodel growth. Store infrastructure is changing to include Wi-Fi and beacons. Enterprise IT budget growth is 4 percent overall, while store IT budget growth is 2.9 percent overall.

The study found the top store priorities for 2015 are omnichannel integration, at 55 percent, and single transaction engine, at 36 percent. Gladly, POS integration has already been done for the most part, and retailers will spend 2015 enabling payment terminals (40 percent) and tablets for managers and associates (34 percent).

The future of POS architecture looks as follows. Sixty-three percent of those surveyed use a distributed order management hub/POS front end and 37 percent use traditional client/server POS.

Twenty-two percent of those surveyed are up-to-date in state of distributed order management, and 28 percent will be implementing this in the next 12 months. And yet, it will take 19 percent of those surveyed 12-24 months to execute the move.

A whopping 50 percent of retailers surveyed cannot effectively use their existing shopper loyalty profiles in-store, which creates disconnect between retailers and their customers.

The most popular emerging techniques are predictive analytics, at 28 percent, and beacons at 22 percent, with only 2 percent of beacon deployment currently in use. 

Ongoing trends
According to the findings of the survey, retailers at large are now in a good position to accept returns and check inventories through stores, meaning that ship from store capabilities need to grow. For the most part, retailers are up-to-date with equipping managers with mobile devices but need to build on mobile POS and engage consumers on mobile at store checkout.

PayPal is currently the largest mobile payment solution of adoption, but 2015 will show Apple Pay, Ally Pay and coupons on mobile screens. Current trends follow payment application on separate networks and point-to-point encryption in regards to card security adoption, but EMV is expected to take over this space this year.

The executives touched on the idea of the waning concept of Black Friday, as consumers are coming to expect deals and promotions throughout the entire holiday season, and they are not doing all of their shopping on Black Friday and Cyber Monday.

This fact points to the overall consumer demand and how retailers can benefit from responding to their needs and desires and providing experiences on the channels they communicate on.

“Consumers want both physical and digital, and we want to be able to manage our choices across both of those spheres,” said Allen Outlaw, vice president of commerce technologies at Toshiba Global Commerce Solutions. “Consumers are the choice here and we have to win with the consumer, and more retailers are recognizing that.

“We’re seeing more focus on how to go down the right journey,” he said. “Yes I can cobble together and integrate my store system, my Web commerce engine and my call center, and I can bolt that stuff together, but if you’ve learned anything, the pace of change in this industry is more in the past five than it probably was in the past 25.

“That pace isn’t slowing down. So by going to that single instance by building forward-thinking architecture, you are enabling speed for your business and your brand, because customers are changing everyday.”

Final Take
Caitlyn Bohannon is an editorial assistant on Mobile Commerce Daily, New York

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