NRF: Around the Fringes

I was struck with not only the number of SAAS vendors, but the interest in SAAS from CIOs. CIOs like the short implementation cycle and the ability to get out if the service isn't working for them. I'd place bets on all of these vendors.

Cathy Hotka, Principal, Cathy Hotka & Associates

I'd venture to say that the large majority of genuine innovations I have learned about in retail solutions have originated within smaller tech firms. Not all the companies in the short list accompanying this article are actually "garage" startups, but why quibble? The point is well-taken anyway.

The widening acceptance of software as a service (SaaS) as a delivery method for mission-critical applications is a trend that's worthy of note. Yes this business model provides a smooth on-ramp for software innovators, since it lowers the sales hurdle considerably. It's also a lower-risk way for client companies to add sophisticated tech capabilities without large commitments to infrastructure and staffing.

Contrast that with the "big iron" and massive consulting requirements of traditional software delivery. Web-delivered and SaaS applications will tend to drive down costs and make more tools available faster to more decision-makers in more organizations. The next few years will favor portals over reports; decision dashboards over post-performance reviews; business intelligence and management by exception over boiling the ocean.

James Tenser, Principal, VSN Strategies

Three things have put road blocks up for start-up companies with innovative ideas:

1. Investing
Not much money these days for start-up companies. There is also a poor track record in the retail space going back to the $100MM lost at VideOcart.

2. Lack of Sales Support
The industry is slow to support new ideas. A great example is the amount of money that is still spent on paper coupons and the antiquated redemption process. Technology has existed for years to improve this process.

3. "You can't beat Big Business"
Every time a new company does start to get some traction the 800 LB gorilla's sweep in and steal the idea or reduce their cost structure to "hurt" the new player. There are lots of examples on this one.

'MrQScan'

Innovation is definitely alive and well. The issue that a lot of these start ups have is they are usually started by the tech guy. Brilliant guys that love the tech stuff but don't have the acumen for sales and marketing. For them to get traction they need to 1) realize their inadequacies and 2) hire or partner with that kind of strength. It will also be hard to get traction from the analyst because many don't look at companies below $20 million. With that said, there are tremendous advantages to these companies, one they are extremely agile and flexible. Two, you could be a large fish in a small pond which is good for a long-term partnership, and the cost of ownership is reasonable.

Another point that the CIO will be looking at is that many of the legacy companies--big companies--have antiquated platforms and the code is mushrooming to large proportions and they are unwilling to invest in a complete rewrite. If the software was developed 10 years ago, technology has really changed in 10 years and the system is burdened with a lot of old code that today would be faster, easier to learn and much, much more flexible.

Suffice to say, new startups are worth the look! Just protect yourself and know what you are doing for a long term viable relationship.

Susan Rider, President, Rider and Associates, LLC

I’m very impressed with Revionics, a small start-up tech vendor providing a predominantly SaaS supermarket price optimization system for the "overlooked." That is, they're all about premium-level price optimization services for smaller supermarket chains who can't afford the big guys (you know who you are, "Big D"). To me, smaller supermarket chains and independent ad groups need to be looking to services like Revionics while using the ARTS Blueprint to make their bidnesses more efficient on small budgets. And while you're at it, small grocers, make sure your IT suppliers focus their efforts more on selling stuff than on controlling costs. It's proven to be the surest path to growth.

M. Jericho Banks PhD, President, CEO, Forensic Marketing LLC

Innovation is alive and well...and growing. Innovation and technology does not depend on good or bad times. Instead it feeds on itself and ideas. The continued growth of our markets, and the new ways of how we can increase productivity, communication and their impact on our lives will continue to evolve, albeit at an increasing rate. The incredible advances that we have seen in the last 5 years compared to the previous 10-20 are examples of this. Retail, the human behavior and different ways to approach these problems are just examples of these.

Kai Clarke, President, Miraclebeam Products, Inc.