Twitter
Facebook
Linked In
RSS
Login or Register
New to InternetRetailing?
Register Now
Internet Retailing
You are in: > Home > Themes > Mobile

This is your 1 complimentary article for this month

Become a member for unlimited and immediate access.


Register
Already a member? Log in here

… because mobile investment offers best returns

Linked InTwitterFacebookeCard
… because mobile investment offers best returns
… because mobile investment offers best returns
Leading retailers globally are increasing their investment in IT systems, with mobile climbing up the list of investment priorities as it offers a better return.

So says the IT in Retail report from Martec International. It covers the systems strategies and priorities of the UK’s 150 leading retailers – representing retail sales of £210 billion and more than 60,000 stores, or 63% of the UK.

The average spend on systems among the leading 150 retailers has risen slightly to 1.0% of sales – back at its 2011/12 level. There was a peak in 2004 when IT spend was at 1.4% of sales and ever since then it has been gradually reducing until the turn up this year. Planned replacement levels are high too, which backs up the trend of increased IT spend.

For the last four years the top investment priority was e-commerce / multi-channel systems and this year e-commerce is again the top priority. Traditionally store systems consumed the largest part of the IT budget, often as much as 80%, because of the multiplier effect of a large number of stores. Store systems again come in at second place. With the rapid acceleration in online and mobile sales, it makes sense that the gap in investment intentions should widen. There is more return to be gained from implementing consumer focused mobile solutions than routine upgrades to EPOS systems. Third in the list of investment priorities is ERP which has a much higher prominence than previous years. It demonstrates that significant IT investment is being planned.

M-commerce is obviously attracting a lot of attention. Survey respondents with stores now experience 4.1% of their total sales from mobile devices, about half of their online sales. 81% of retailers have a web site that is optimized for smart phones and tablets at present, up from 60% last year. Some of the leaders in mobile now do more than 70% of their online sales on mobile devices.

The average retailer now has 4.6 different sales channels. This figure is increasing each year. But systems are not very often integrated across all sales channels, making it difficult to manage them profitably.

There is a significant level of IT spend that is not controlled by the IT department. 42% of retailers recognise that other departments invest in IT projects that do not come under the auspices of the IT department and this is up significantly from 33% last year.

The key departments that do this are e-commerce and marketing (22% of all retailers have e-commerce departments that invest in non-IT controlled projects and 17% for marketing). HR is third although the incidence is smaller, but it’s growing too. Control of the complete IT landscape is slipping out of control of the CIO as cloud based applications become more common and easy to invest in, without involving IT.

Cloud based computing is now mainstream – 80% of retailers already use one or more applications on the cloud, this is up from 51% last year, with a further 6% planning to do so. The largest group (26% of retailers) runs a variety of minor applications on the cloud. The single most important retail application run on the cloud is e-commerce used by 21% of retailers, up from 15% last year. Often this investment in cloud based systems is being made outside of IT, by the e-commerce department.

“We believe that consumer pressure for a joined up shopping experience across channels is boosting retail IT spend at the moment,” .” says Fran Riseley, Director, Martec International. “This means retailers are buying ERP systems, and replacing merchandising and e-commerce systems so that the vision of a single stock pool and view of customers across all sales channels is realised. It is significant that IT spend is moving out of the IT department, with marketing and e-commerce executives being the main investors in technology beyond the CIO.”
Linked InTwitterFacebookeCard

Become a Member

Create your own public-facing profile
Gain access to all Top500 research
Personalise your experience on IR.net
Internet Retailing
We are the magazine, portal and research source for European ecommerce and multichannel retail, hosting the board-level conversation for retailers, pureplays and brands across all of our platforms. Join the conversation.

© InternetRetailing Media

Latest Tweet

Internet Retailing
Tamebay
eDelivery
Twitter
Facebook
Linked In
Youtube
RSS
RSS
Youtube
Google
Linked In
Facebook
Twitter