Digital Transformation Wake Up Call

Digital Transformation Wake Up Call2018 RIS/Gartner Retail Technology Study

Joe SkorupaEditorial Director

RIS News

28th Annual Retail Technology Study

Presented by RIS News

Research Partner: Gartner

Wake Up Call forDigital Transformation

Big opportunities and strong headwinds accelerate the pace of unified commerce and

digital transformation

Title Sponsors: Oracle & Intel

Download at : www.risnews.com/research

2017 was a record year for consumer spending

ANDa record year for retail bankruptcies and store closings

Remind you of anything?

- Charles Dickens, A Tale of Two Cities

It was the best of times, it was the worst of times,It was the sage of wisdom, it was the age of foolishness, It was the epoch of belief, it was the epoch of incredulity, It was the season of Light, it was the season of Darkness, It was the spring of hope, it was the winter of despair, We had everything before us, we had nothing before us, We were all going direct to Heaven, we were all going direct the other way


RIS News

Retail Wins Big in 2017 and 2018

Strong Economic Trends• U.S. annual retail sales up 4.9%,biggest increase since 2011• U.S. Retail holiday sales climb 4.9%over 2016• E-commerce sales rise 16% comparedto 15.6% in 2016• Unemployment is low, stocks are high,consumer confidence is high, wages areincreasing• The Fed is so bullish on the strength ofthe overall economy it is planning toraise interest rates several times in2018 to avoid overheating

Big Retail Winners• Amazon• Best Buy• Carter’s• Coach• Costco• Lululemon• Ross Stores• Sephora• The Home

Depot• Trader Joes• Ulta• Walmart

Retail’s Dearly Departed in 2017 and 2018Bankruptcies and Liquidations• Aerosoles• BCBG Max Azria• Bon-Ton• Charming Charlie• Claire’s• Gander Mountain• Gymboree• Payless• Perfumania• Rue21• The Limited• The Walking Company• Toys R Us• True Religion

Massive Store Closings• Abercrombie & Fitch• Ascena Retail Group• Bebe• Foot Locker• GameStop• Gap• Guess• JC Penney• J. Crew• Macy’s• Michael Kors• Sears/Kmart• Staples• The Children’s Place

No “Retail Apocalypse” But…The Rising Tide Did Not Lift All Boats!

• Retail revenue grew 4.2% in 2017, according to U.S. Department of Commerce • However, only 26% of respondents met or surpassed this growth• 74% of retailers did not achieve average revenue gain recorded for industry• 27% either lost revenue or closed their books with NO increase

Source: 2018 RIS/Gartner Retail Technology Study

But IT Budgets Are Set to Rise in 2018!

• IT Budgets are planned to rise 4% in 2018, up from 3.5% last year• 69% are planning to increase IT budgets in 2018• This is down from 88% who planned an IT budget increase last year• So fewer retailers are increasing IT budgets and the increases are higher

Source: 2018 RIS/Gartner Retail Technology StudySource: 2018 RIS/Gartner Retail Technology Study


RIS News

Key Takeaway #1Retail is bifurcating into leader and laggard groups

• 184% of leaders identify analyticsas a key strategy over the next 18months compared to laggards• 192% of laggards are struggling tooptimize stores as a growth channel• 224% laggards say retiring legacysystems is a major problem holdingthem back

Top 10 Technology-Driven Strategies



Top 10 Technologies for 2018





Technologies to Watch in 2018

1. Order management is only important if you care about online sales,in-store sales, omnichannel sales, customer satisfaction and loyalty

2. Fulfillment and an optimized omnichannel supply chain are onlyimportant if you want to compete with Amazon, Walmart and Alibaba

3. Mobile-first solutions are only important if you care about in-storeconversions, store productivity and meeting customer expectations

4. CRM and a rich customer database are only important if you care aboutpersonalized marketing, building loyalty, and growing your customer base

5. Supercharging the in-store experience to increase engagement usingimmersive technologies, i.e. kiosks, digital displays, handhelds, and emergingtechnologies, such as virtual and augmented reality, robotics, IoT, and AI

Trends to Watch in 2018

1. Digital transformation is the key to meeting customer expectations,personalization, productivity and the ability to be responsive to change

2. Gen Z shoppers, a tech-savvy generation on steroids, seeknew, creative, interactive and self-service shopping experiences

3. The art of the store, with its promise of great prices, products andservices, must be reinterpreted through omnichannel technology

4. Think like a startup and make strengths out of current weaknesses,such as change management, innovation, disruption and failure!

5. Yes, You Can! Amazon, Walmart, and Alibaba alter the retail center ofgravity but leave open many doors of opportunity for fast-moving retailers

Thank You!


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Digital Transformation Wake Up Call