Barron McCann - Delivering Service Excellence

Increased retail tech investment in 2016 aimed at expanding and understanding

While growth in 2015 was down from 2014 at 2.2%, [1] historically low fuel prices and mortgage rates combined with increased consumer confidence suggests that consumer spending will be the main driver of business growth in 2016. Consumer expectations are constantly evolving, and the main trends currently are speed and interactivity. On average, retailers enjoy an average of 3 minutes ‘goodwill’ time before customers start abandoning delayed purchases.

Diversifying available payments methods has become a priority, sitting at the top of the major action items list for the 85 HQ-level senior executives surveyed in the 24th annual Retail Info Systems study, with 46% of these executives naming it their top priority. [2] More sophisticated CCTV systems are giving retailers a new approach to CRM in addition to enhancing loss prevention. IP-CCTV systems combined with Video Analytics are not only capable of facial recognition, they can also process the details of an observed in-store situation by counting, monitoring direction and measuring speed to provide all kinds of insights into customer behaviour.


Increasingly diverse options


With the ever-increasing level of choice available, we expect the demand for expert consultation and managed service provision to increase over the course of the coming months. Having access to the wealth of experience possessed by service providers can both simplify and enrich the planning process. Retailers can get an introduction to new solutions which they may not have considered, alongside a well-informed evaluation of their effectiveness in applications similar to their own, and may also get valuable warnings against potentially problematic systems. Retail technology systems is an increasingly specialised field, and using a service provider can eliminate the substantial costs of generating the required expertise and knowledge in-house, having a big impact on the bottom line.


Multi-site rollouts


The degree of expansion across multiple sites in some retail sectors in recent months and plans for similar future development has been impressive. Aldi and Lidl have lodged 93 and 78 new store planning applications respectively, a testament to their explosive growth [3]. Combined with the need for different devices for different purposes, the growth of new and often varied format locations can increase the complexity of installation considerably. Some of the most explosive growth to date has been made by companies in partnership with service providers, for example Pep & Co’s unprecedented opening of 50 stores in 50 days, handled in partnership with Barron McCann.


Tighter card payment controls


PCI DSS compliance is also a big factor, with the latest updates to the regulations tightening the rules further by ruling out SSL/TLS (the standard internet encryption protocols) as security controls in any shape or form. [4] Any business which handles card payments much comply with the PCI DSS or risk substantial penalties if they lose card data while out of compliance. Due to the requirements of PCI DSS compliance, some retailers will face especially complicated upgrades. Using a service provider solves this problem simply by repositioning responsibility from the retailer to their provider. P2PE (point-to-point encryption) solution greatly simplify PCI DSS compliance by reducing the scope of the card holder data environment: if card data is lost, the system is held accountable rather than businesses who’ve implemented it.

Overall, we anticipate that retailers will place their focus on boosting productivity, increasing security and improving insight by implementing new tech solutions. The ever-present need for uninterrupted operations in face of an increasingly impatient consumer market may see more organisations specifying 2-hour fix rather than NBD SLAs for their business critical systems, and similarly the need for constant monitoring is likely to rise. A highly ambitious retail sector has driven innovation in new retail technology, and now that sector is taking full advantage of these new developments in order to optimise operations and deliver the strongest possible customer experience.





Contributed by: Alan Watson, MD, Barron McCann

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