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When it comes to retail tech, consider gray matter before gray hair

February 19, 2014

I don't think it's discriminatory to say something self-incriminating, so first, allow me to admit to sporting a few gray follicles myself. Secondly, I'm not against anyone of any ilk. Objectively though, when I look across the landscape of purveyors of in-store technology including digital displays or tablet solutions, many that offer either dated or "me too" concepts are represented by people of a "certain era."

The point is not about age, but about perspective. It's crucial for technology providers to think progressively and be in-tune with the mindset and motivations of current and future users. Yet, many of the "latest concepts" in retail have previously been piloted or deployed at least three to seven years prior. No kidding.

In 2010, one of the world's biggest POS vendors proved this point while promoting its new music download kiosk. iTunes was already ubiquitous and growing tremendously, yet this "old school" company opted to revisit stationary music download machines — something introduced in the 90's.

Recently I watched a video from a digital signage vendor that proudly boasted of their system, an ultra-typical web-like product interface with a button with which a shopper can summon a salesperson for help. If beckoned, the associate arrives with a tablet that reveals the consumer's browsing history. Replace the word tablet with Blackberry and we're back in 2005.

There's nothing wrong with systems that provide core interactive features and services, especially for retailers that offer none. But if you want to stay ahead of the competition (Amazon Flow for example), distinguish your store as a unique destination, and provide the best in class user experience, ordinary doesn't cut it.

The problem is, vendors that are not on top of today's fast moving tech trends and social change will suck up your budget on their way to delivering an average (or worse) engagement solution that will never recoup your investment. Many of these cases prove that eons of industry experience are not automatically a good thing.

If you want to grow your in-store interactive engagement, do the research and do the math. It's imperative to question the knowledge and thinking of any vendor you entrust your brand and livelihood to. It's easy to dismiss new tech as trendy or for younger markets only, but that's a mistake. Even if you have grey haired customers, that's no justification for risking your business on fossilized technology that's only cool to the people who are pushing it.

Discussion Questions:

Are retailers looking progressively enough at in-store technology options? If not, what's causing the conservative approach? To what degree may retail have to wait out an older-thinking mindset before true tech-driven innovation arrives?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

What's the likelihood that retailers may have to wait out an older-thinking mindset before true tech-driven innovation comes to retail?

Comments:

There are two different questions here.

1) Are retailers looking progressively enough at in-store technology options? The short answer is yes. I see a real changing of the guard and it's coming through in our data. Retailers are becoming much more open to real technologies that can improve the customer experience in stores, and improve their merchandise assortments. I think the folks in my age bracket are either retiring or adapting to change, while a new era of executive comes into power.

2) Are vendors looking progressively enough? Well, that depends on the vendor, doesn't it? It depends on how much they are willing to invest in R&D vs. milking existing technologies, how well they understand the competitive landscape, and how well they are rewarded for innovation vs. earnings. So I think it's a matter of calculating ROI.

In the end, market forces will win out in this case. And vendors with old thinking will start dying off, while those who experiment and take changes will thrive.

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Paula Rosenblum, Managing Partner, RSR Research

There is not much differentiation in retail formats yet, with a few exceptions. Why? If there is a team of top executives with a similar perspective, it will be difficult to get different ideas. The team for generating ideas needs to be diverse and then the executives need to realistically determine which solutions can be implemented to match their most valuable consumers in a cost effective way. Using a homogeneous group to generate new ideas for a group of consumers who are not like the homogeneous group is not likely to result in much innovation.

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Camille P. Schuster, Ph.D., President, Global Collaborations, Inc.

Most small, independent retailers don't have the resources to quickly take advantage of the latest in-store technology options. Large, corporate retailers have to go through multiple levels of decision makers and getting their stockholders on board before switching to the latest tech-driven innovation. Let's face it, it will always take longer to adapt to new technology than to create it.

'RetailRetell'

The starting assumption in our culture is that "people resist change" and that mindset causes the very circumstance we keep complaining about. It may be that people don't resist change so much as they resist "being" changed. When the new idea comes from within and has passion attached to it, not much can stop it.

What frustrates me is our complete intolerance for exponential change. Those big leaps in seeing what is possible. As long as the "change" is linear and presented in tiny baby steps, it may be accepted. But try something truly transformative and minds - young or old - can't seem to deal with it. Sadly, the "That's impossible!" line we draw is very close to where we're standing.

As my friend tech forecaster Dan Burrus says: The biggest challenge facing organizations today is that they'll change but they won't transform."

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Ian Percy, President, The Ian Percy Corporation

The challenge is that we always have new devices (e.g., in the late 1980s we had cart-mounted "tablets," and home delivery of groceries was also started at that time), however several issues still linger. We still have too many out-of-stock items in-store, especially promoted items. We still have in-store staff customer service failures and the checkout process is still far from perfect.

Bottom line, we need PROCESS, not just technology innovation. Tech is great and cool, however, implementing tablets in your stores does not guarantee profitable growth for your company. Don't be too proud to look at your basic business processes and eliminate non-value-added elements of every task...and this advice is coming from a technology company employee!

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

When it comes to in-store and consumer-facing retail technology, retailers should beware of capex and long-term commitments. There are some vendors who want to sell you stuff that anchors you to their solutions. They may use vintage reasoning to justify this. Resist, please.

As a rule of thumb, I believe retailers should seek out the lightest technology possible to deliver on each goal. Choose what's quick-to-deploy and easy-to-discard once it turns obsolete or the goal itself loses relevance (which will happen sooner than you probably think).

Kiosks, smart shopping carts and in-store digital signage are instances where systems were all too frequently behind the curve on launch date. When form follows function too closely, there is no good way to re-purpose the hardware when the functional needs change.

Smarter retailers are getting used to continuous churn in their shopper-facing solutions. Smartphone connections, small digital screens, in-store sensors, and beacons all look promising at the moment. Just be ready for all present assumptions to change in an instant.

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James Tenser, Principal, VSN Strategies

As a technology vendor, these questions pose issues that we deal with all the time. Most retailers have somebody in the organization looking for new technology, unfortunately most of the time they're just authorized to "look," not buy. The buying decision is often made at the very top of the organization because the technology changes the way things are done in every store, every day.

We use a customer driven tech development approach. That is, we develop the bones of something new and complete it when we have a lighthouse brand onboard to pilot. This approach ensures that we address real business process pain points with solutions that are not only new and "cool," but actually solve a problem.

Once the pilot is complete we are then in competition with everything else in the budget and often the new idea doesn't make it, even with proven ROI. Why? New ideas bump up against the "way we've always done it" mentality and it's safer to do nothing.

Pretty much the only feedback retailers get about their in-store experience is from their Customer Experience Surveys which are unscientific and usually so subjective that the results can and are interpreted to support the decision not to move forward with something new.

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Marge Laney, President, Alert Technologies, Inc.

You just can't generalize on any of this. Some retailers are smart and progressive, others aren't. Same with vendors. No group has a monopoly on anything. Sometimes the gray hairs don't understand the tech itself, but accept and understand what it can do for them, and move forward with experts they trust. (I try to be in that category.) Others hold it back. It takes all kinds, and the process is Darwinian. As I recall, Walmart sat quietly in the back of the room and took notes at all the ECR conferences 25 years ago, and then were about the only ones to take real action.

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Warren Thayer, Editor & Managing Partner, Frozen & Refrigerated Buyer

I cannot agree more with the poster. And I have a theory as to why. The retail industry still relies on an ancient platform, the "trade show" to launch and demo technology solutions. We can't really blame vendors because, frankly, the approach has worked rather successfully in the past. This is how it works.

Pick a trade show and purchase a big booth. Do the dog and pony show. Meet tons of well-intentioned people and make a lot of promises. Don't actually show much (you can't anyway, you're on the floor). Next thing you know you're selling a lot of consulting hours on projects that run for months.

Judging a vendor by the size of its booth at a retail trade show is perhaps the worst "metric" one could use, and here is why. Retail is going through an existentialist crisis right now. E-tailers are carving an ever larger slice of the market pie. Social media is changing customers' research and shopping habits. Now is not the time to do things "the way we always have." While there is nothing wrong with trade shows per se, a trade show is hardly indicative of what a technology vendor is capable of.

If your technology vendor can't demonstrate they are nimble and quick-to-market, skip them. If you can't see and try a product in a matter of hours, move on. If integration costs real money, it means the offering isn't actually productized; keep looking. If your technology vendor could do these things any other way, they would. Buying from the boardroom-ware vendor could mean you are buying the worst of the lot...buyer beware.

Fabien Tiburce, CEO, Compliantia, Retail Audit & Task Management Software

Seems to me the challenge is that the tech solutions I'm seeing are "what the techies can build" rather than "what helps the consumer in a meaningful way."

For example...iPad proliferation. Stores have this fantasy that consumers want to watch video on demand in their stores. I don't find that enough of them want to seek out on-demand (meaning randomly pick a video for any product in the store) to have the technology meaningfully have a sales impact.

Actually, most products in stores don't need video (I don't need a video about the 10 penny nails I'm about to buy and I don't need a video about dish soap).

So, the most effective in-store video remains the traditional model where video is integrated as a promotional driver for products that clearly benefit from video. The primary value of technological advance has been to make this effective and cost effective for a wider range of products and with more in-store video displays.

Techies love to make technology that makes them feel innovative. As a former tech employee, I have seen this in action for decades. But what stores need is technological applications that are meaningful to consumers. And these are extraordinarily rare.

Doug Garnett, Founder & CEO, Atomic Direct

Retailers -- as a group -- are not progressive because retailing -- as an industry -- is the oldest of all human group activities and so the "rules" have had eons to calcify.

As to the generational innovation cycle -- please! Was Steve Jobs too old to innovate? Or Bill Gates? Or Larry Ellison?

If retailing is waiting for the birth of an enlightened generation, it will be waiting a long, long time. Innovation is driving by individuals (often, but not necessarily young) who are touched by genius and genius is found in every generation as -- sadly -- is conventional thinking.

Want to sew change? Try dropping the seeds in more fertile soil. Change the cultural mores of retail before they change another generation and innovation will explode.

Being "progressive" is a state of mind, not a statement of chronology.

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Ryan Mathews, Founder, ceo, Black Monk Consulting

In the spirit of reducing complexity via listicles, here is my deconstruction of this brave and relevant question.

5. Naysayers kill innovation but they also care about data breaches - the balancing act is an organizational issue.

4. Store systems are thought of as platforms, mainly with a back office focus, so front office systems suffer back office head winds.

3. Moving from Data Models to APIs is not going to happen overnight - it's going to obsolete incumbents - like SAP and Oracle, they are not going to accelerate their own demise, they are trying to ride the wave - no/yes?

2. PTSD due to past in-store changes is hard to overcome.

1. We can't all be Amazon, we can't compete for the talent and we can't offer the incentives of tech companies - we need the help of tech companies!!! (Go to 5 above and repeat.)

Vahe Katros, Consultant, Plan B

I like a saying I once heard; adapt or die. The thing about new technologies is that they require early adopters and patience. How long did it take for the airlines to convert passengers from using reservation agents to booking tickets online? There is still the option, but a huge percentage of passengers book online. They also check in online. The airlines may be one of the best case study for converting people to newer technologies.

Look at self-serve checkout in stores - or using PayPal, online banking, and the list goes on and on.

If the technology is simple and logical, saves time and money, with the right roll-out, it will catch on.

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Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC

Generally there are three kinds of new and exciting Information Technology (IT) offerings in the market. This is true for any and all businesses and/or consumers. The new IT contributions include hardware, software and any combination amount of these ingredients known to IT insiders and "the banished" as vaporware.

The stories of what happened to the last guy or gal that jumped all in on version one of anything are countless and horrifying. In fact, most of the long term employed IT managers and executives refuse to do anything until the jury is in on the products under consideration.

When looking seriously at cutting edge technologies for whatever reason it is a good practice to leave your wallet and pen at home which will allow you an opportunity to make a decision after the sales and marketing either has worn off.

'gjarnoldjr'

No. Most retailers ARE 5-10 years behind, if not more. This is not just because of the older mindset, but because demanding change, and paying to get it implemented, within an organizational structure, takes a tremendous amount of time, resources (both human and financial) and most importantly, organizational support and awareness from the top of the company down. To have all of these align, and focused on a single technology is difficult to say the least. Add to this the speed at which technology moves, and you have a continually lagging indicator (retail technologies) trying to be reflected in current market innovation and technology usage.

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Kai Clarke, President, Kowa Optimed, Inc.

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