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Top 6 Challenges Facing Retail in the Digital Age

Posted by Norman Korn on Jan 6, 2015 11:33:03 AM

Last month, Amazon tested its new one-hour delivery service in New York City, giving shoppers the capability to order items from a specific list, with items ranging from toiletries to pet food. Once ordered, Amazon provided customers with notifications and real-time tracking of the product until it arrived at its destination, less than an hour later. Amazing, right?

Although, Amazon is only one example of how retailers are adapting to meet customers’ demand for a fast, unique, 24-hours-a-day, 7-days-a-week experience, and companies are using emerging technologies to help meet those needs.

Today’s tech-savvy consumers want an “always open” shopping experience stocked with the latest in-demand products and experiences. To accommodate these changing needs, retailers are required to evolve their strategies, capabilities and technologies in order to expand their core business and boost customer loyalty – while also hoping to mine new market opportunities that can fuel solid business decisions and help to boost their sales.

Multi-channel, social retail data management, analytics, customer centricity, mobility and infrastructure optimization are key areas of focus in the fast-growing retail market. These technologies create multiple opportunities for solution providers who want to take advantage of the growing retail market opportunities. Innovative retailers are leveraging these new capabilities to enhance their brand, drive revenue and increase retention and loyalty. However, navigating the challenges of competing in the retail market alone can shift the focus away from the customer. Below are some of the few challenges facing the retail industry and solutions providers today that could prevent retailers from competing in the market and closing deals in the future.

  • Fragmented IT infrastructure. Aging and siloed IT, store and distribution networks make it nearly impossible to efficiently brand, market, merchandise, service and sell across multiple retail channels.
  • “Always open” availability. Retailers often do not have an effective plan for dealing with costly outages that can disrupt the customer experience, impact sales and reflect negatively on the organization.
  • New and emerging technologies. Newer technologies—such as digital signage, kiosks and mobility—are challenging retailers’ infrastructures and emerging technologies, such as near-fi­eld communications (NFC), are close behind.
  • Growing data. As with other industries, retailers collect and store massive amounts of customer, product and transactional data—which is meaningless unless it can be mined for actionable intelligence.
  • Performance bottlenecks. Managing a large number of simultaneous customer transactions can slow applications to a crawl—and potentially impact sales, not to mention frustrate and lose customers.
  • Skyrocketing costs. Instead of directing scarce resources to improving the customer experience, resources are often diverted to maintaining inefficient infrastructures—driving productivity down, costs up and negatively impacting the shopping experience.

With all of these challenges at hand, same-day delivery doesn't exist because the delivery driver’s truck is going faster.  It exists because the IT systems are in place to take the order, receive payment, reserve the inventory and schedule pick-pack-ship in near real-time without human intervention.  As retailers try to make sense of all of the hype and challenges ahead, a common thread exists:  IT capabilities are central to all of them, enabling tactics and strategies that provide a competitive advantage.


Interested in learning more about the retail market and capabilities to better serve your retail customers? Are you planning on attending NRF’s Big Show next week at the Jacob K. Javits Convention Center in New York City?  

Join me at the event! Visitors at the Avnet Booth #625 will learn how to turn retail shoppers into fans for the “Grand Slam of Customer Experience.” and join Avnet at one of the speaking engagements throughout the week:


If you have any questions about Avnet’s presence at NRF, or want to arrange some time to meet, feel free to reach out to me at Norman.Korn@Avnet.com. If you're not attending NRF, please feel free to also reach out to me and I would be happy to discuss any questions you might have.

Tags: Mobility, Big Data, Business, Channel Retail, Data, Data Analytics, Events, Information Technology, NRF, Retail Technology, Customer Experience, Fragmented Data, Multi-Channel Retail, Multi-Channel, Retail