Industry trade show discussions around multichannel, omnichannel and data intelligence put customer first, writes Miya Knights, Retail Technology editor

Retail Business Technology Expo and Cards & Payments Solutions 2012 opened its doors at Earls Court 2 for yesterday, providing a window into the current industry mood and trends.

With over 200 exhibitor stands, one ‘Pecha Kucha’ and four seminar theatres, two innovations showcases and representation from global industry retail associations, such as the Global Retail Forum and the Association for Retail Technology Standards of the US National Retail Federation (NRF), it was easy to feel overwhelmed by the sheer array of information on offer. In that sense, organisers certainly succeeded in building the show into an event that felt far more mature than one only in its second year.

The size and scale of the show, confirmed by the number retail IT technology decision makers and suppliers with the latest products and services they had to offer, was the best indicator yet that demand for technology as a means to harness not only innovation and competitive advantage, but also strategic agility, is beginning to return to the industry. Put another way, by John Lewis IT director Paul Coby, who gave the expo’s keynote address, consumers are increasingly driving retailers to regard technology as much more than just a functional cost centre that – in hard-pressed times – they could afford to ignore.

Maintaining brand consistency

“In my view, you’d be King Canute if you think this is not happening,” Coby declared, after outlining the unabated growth of sales through digital commerce channels experienced by the department store retailer. He said that nearly at 25% of its sales are conducted from online and that it was seeing between 20 and 40% growth year-on-year in some categories, while 20% of its online orders are already made through tablet devices. “I think this amounts to revolution in retail,” he continued. “Or rather it is that retail is being revolutionised by changes in technology. But we’re staying true to our heritage, while competing in uncertain economic times. Most importantly, we are addressing the business of retailing in this new ‘omnichannel’ world.”

Whether the retailer or IT supplier subscribes to the terms, ‘multichannel’ or ‘omnichannel,’ Richard Cuthbertson, Oxford Institute of Retail Management research director at the Saïd Business School, University of Oxford, suggested such terms implied that retailers realise they can no longer afford to take a siloed approach to maximise the value of their customers. “Retailers have traditionally developed lots of technologies for online versus the store. Traditionally, this has been silo-based, where the retailer captured the customer with the store experience. What we’re seeing with technology adoption now is that the retailer is no longer in control, it is the customer who, armed often with more knowledge about the product they want to buy than them, decides how they want to interact with that retailer and so has control.”

Maximising information integration

Cuthbertson kicked off a major retail technology research project with Intel this year and was at the show to discuss key customer-focused themes. “Retailers are still stuck in the mindset of selling to channels,” he added. “But customers don’t see ‘channels,’ they see logos and a brand and expect a certain service or value from that brand. In the same way, what is a digital screen in the store to them? One that delivers information, but that is a used for training by HR [human resources], to deliver promotions for marketing and as a sales tool by store staff.” Chris O’Malley, Intel retail marketing director, took up the point that IT has never been more important as a strategic enabler: “The CMO [chief marketing officer] sees it as a tool for increased conversion rates and basket sizes. They come back from shows like this and say to the CIO [chief information officer] or CTO [chief technology officer], 'we need that,' and the CIO or CTO wants to find the most stable, reliable solution."

In response, many at the show were keen to stress that technology, as an enabler, was only as good as the data it processed and sales or operational information it provided in a customer-centric manner. IBM Netezza was discussing its new intiative with US software and consultancy firm Aginity, to provide retail analytics on top of the IBM data warehouse appliance. "Achieving one view of the customer is nothing new," Farrukh Khan, IBM Netezza retail solutions executive told Retail Technology.

"But retailers have to handle a lot of persistent data, with volumes that are going through the roof." He added that the partnership was not trying to repeat what had already been achieved through customer relationship management systems (CRM) or existing analytics packages. Jonathan Tebay, IBM Netezza retail and consumer packaged goods business solutions executive in Europe, Middle East and Africa, said: "With siloed operations, retailers find it difficult to analyse customer behaviour across channels, where they don't necessarily know whether they are losing customers to other channels."