This year's Black Friday sales may have increased only slightly over 2009, but PayPal reported a whopping 27 percent increase in total payment volume. And, U.S. online sales rose 16 percent on Cyber Monday, topping $1 billion for the first time says Bloomberg. It is no surprise more shoppers are buying online. What is new is how the shopping experience enabled by smartphones, social media, and other technology is driving revenue.
Here is a look at some technology trends that are propelling the retail industry forward. Many of these applications and technologies can also be used across industry segments.
1 - Social Media and the Shopper
Facebook and Twitter continue to be powerful players in the retail world. Today, retailers are expected to have a presence on Facebook and Twitter, and the savvy ones are leveraging these sites to market new products, promote special offers, and build relationships whose goal is to drive business online and in stores.
This year, it is the consumers themselves who are major influencers. By using Facebook, members are recommending their favorite product or service to each other. Social media is becoming a powerful source for opinions beyond the traditional online e-commerce sites where shoppers seek anonymous online opinions ( such as Amazon.com and yelp.com).
2 - The Explosion of Information
The good news is that retailers have a treasure trove of data and information available to them via the Internet and their own captured customer information. This data can be mined and analyzed and put to use in such areas as CRM (customer relationship management) strategies, new product development, and improved business processes. The explosion of data will not only increase storage needs, but will force IT to examine how it can make the necessary information available to employees and to customers, on-demand.
3 –Retail Technologies to Attract Customers
Mobile shopping is the biggest trend. The National Retail Federation points out how retailers are using special mobile coupons as well as leveraging QR (quick response) Codes. These QR Codes are found on products and marketing pieces which, when scanned with a smart device, can divert shoppers to websites or other locations for more information about the product or promotion. On Black Friday this year, 5.6 percent of shoppers used smartphones to access online retail websites. These same smart devices and new applications will surely drive new business processes and customer experiences.
Steps for IT to Consider as Retailers plan for 2011:
While the retail industry has one of the lowest IT operating budgets as a percentage of revenue, IT can make big strides by considering these strategic steps:
Action: Leverage the Cloud, be it private or public. Consider hosting as many applications in the cloud as makes sense. Options may include software-as-a-service for email, e-commerce, and CRM; business process-as-a-service for payment processing; and infrastructure-as-a-service where the cloud supports storage, servers, and file systems for variable utilization levels.
Action: Be a strategic partner with other internal business groups such as those determining the corporate social media strategy, for example. The expertise of the IT organization is an asset and a revenue driver when technology is used as a competitive advantage and business enabler.