Posted by Barney Beal, Content Director, NetSuite
Retail has evolved tremendously over the past decade and this tempo isn’t slowing down anytime soon. Technological advances and evolving consumer expectations are directing this transformation, which has forced retailers to make quick decisions in an effort to survive. For most, those decisions were and continue to be costly and convoluted as IT departments struggle to keep up with the rapid pace by patching together each channel of business. Now retailers are hanging by the loose thread that’s stringing these various systems together; tangled by individual strands of data for each department of their business including financials, customer records, ecommerce, in-store, warehouse and wholesale.
The current multi-channel, multi-silo landscape most retailers operate with isn’t working. This approach hinders the customer experience, adds unnecessary IT costs, creates data redundancy errors and limits growth. Retailers understand they must invest in technologies that are flexible enough to help them overcome these barriers which is why many are evaluating cloud technologies. In fact, according to the retailers interviewed in the annual 2016 Store Systems Study, Brave New World of Unified Commerce, conducted by RIS News and IHL, 26 percent of all retail software spending in 2016 will be dedicated to cloud-based software.
“Cloud technology is the key to success for retailers,” said Matt Rhodus, Director and Industry Principal for Retail at NetSuite. “Cloud-based solutions offer flexibility, scalability, accessibility and overall cost-effectiveness and that is something on-premise solutions just can’t compete with.”
In this same report, results revealed that of all projected cloud spending, retailers are reserving 51 percent for ecommerce platforms and 21 percent for store systems.
Rhodus advises retailers to exercise caution when purchasing customer-facing solutions.
“What’s important to remember is that customer-facing systems won’t solve the underlying issues,” he said. “To really achieve unified commerce, you must have visibility across every touchpoint. A new POS or ecommerce platform might be equipped with all the bells and whistles, but it won’t get retailers to omnichannel commerce on its own, it must have a database to feed information from efficiently and accurately. If that data feed is broken your customer experience will be too.”
Matt suggests retailers first lay a solid foundation such as a cloud-based ERP system, which according to the study only makes up 10 percent of all cloud spending in 2016. “Once a solid back-end solution is in place, retailers can then shift their focus and invest in POS and ecommerce solutions.”
To learn more about this strategy, join Matt for his on-demand presentation focused on achieving unified commerce.
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Download the 2016 Store Systems Study, Brave New World of Unified Commerce, to discover which technologies retailers are investing in now to break down these silos and achieve true unified commerce. Get the Report.