It's no secret that the past few years have been challenging for UK retailers. According to Deloitte, 2018 saw a 36% increase in net store closures compared to 2017 - 7,500 in total. With pressure increasing and costs rising, we expect budget holders in areas like IT will start to see a squeeze on the funds available to them.
This blog explores how IT leaders can get maximum impact from their budgets and optimise their departments.
Priorities for retail CIOs
According to CIO, one of the top priorities for information leaders in 2019 is to replace outdated systems with those that are more secure and flexible.
Although many retailers are looking to adjust their digital offering to improve the customer experience, they need the infrastructure in place to be able to cope with this. At Coeo we've seen that many businesses find it hard to move existing applications to more modern systems. Many have seen the effectiveness of their applications affected following a migration.
The priorities for the IT Department should be aligned to the overall strategy for the business. As retailers increasingly look towards omnichannel offerings and seamless integration across channels, IT will come under increasing pressure to support these initiatives. Therefore it is key that leaders look to reduce costs while improving efficiency in order to make the most of constrained budgets.
How to optimise retail IT
The first step to take before making any changes is, of course, to analyse your current infrastructure to see if you are operating in the most cost-effective manner. Analyse the benefits and challenges that result from your current set-up, whether there are any areas that you are content with and any that could do with improvement.
Look at alternative technologies or methods of hosting and compare the prices and benefits to your current infrastructure - this will highlight any areas that are ripe for modernisation.
In terms of data platforms, you may find that a move to the Cloud reduces your expenditure in this area as you will no longer need to pay for associated hardware. You can read up on options for data platform modernisation on the Coeo blog.
It's also beneficial to establish a good working relationship with your organisation's CFO, particularly if you are aiming to request funds to make improvements. Clearly show them the value of IT, the work you are doing to improve effectiveness and a willingness to work together to optimise spending.
When considering improvements, prioritise those that align closest with your company's overall business strategy and will provide the greatest benefits in the short term.
Using IT to improve customer experience
A study by Aberdeen found that companies with effective omnichannel customer engagement strategies retained 89% of customers on average.
Omnichannel is a multi-channel sales approach that provides customers with the same experience however they choose to interact with your business - through a physical store, app, website or social media.
This approach moves beyond using to data to simply trace previous orders, to offer your customers a more personalised experience. For example, a supermarket could use information about food items purchased and logged in an app to provide customers with recipe suggestions (Information Age).
Data collected from multiple touchpoints can, in turn, give your business valuable insights into customer trends such as demographics and buying habits. This enables you to create offers that encourage customers to visit physical stores, improving the likelihood of impulse buying (Jacada).
If you aspire to become omnichannel, you need to be careful not to lose sight of operating efficiently to best cater to customer needs. For retailers that operate bricks and mortar stores as well as ecommerce sites, they need to ensure that the buyer journey is integrated into both the front of house and back office.
For example, a customer should not have to scan their receipt multiple times in order to receive different services – such as gaining loyalty points or returning items. Equally, key information such as stock availability should also be updated automatically.
Find out more
Looking to create an informed strategy for the future of your data platform? Coeo has created a guide to modernisation that you can download from the link below: