A Look Back at 2010 Predictions

Now is the time of year people make their predictions for next year, but before I start thinking about 2011 it's worth a look back to see how my predictions for 2010 fared.

1. Borders and Blockbuster bite the dust. I would have never predicted a strong brand such as Circuit City could die, but now I know it can happen to anyone. Borders has lost the battle with Barnes & Noble and Blockbuster has lost to Netflix. And just to be sure, Amazon put an extra nail in each coffin.
Borders received additional investment from Bennett LeBow to keep it afloat, but the stock is down around $1.25 with no profits in sight. Blockbuster filed for bankruptcy back in September.

2. Every retailer finally has a page on Facebook... but very few figure out how to keep fans engaged. Retailer postings become noise, and fans start to unsubscribe. Twitter goes in the same direction. A few standout retailers will figure out how to use social media, and the rest will remain dumbfounded.
Most retailers are on the Facebook bandwagon, and their fan bases seem to be increasing thanks to promotions like The Gap's logo redesign, Lowes' black Friday sneak peak, and Walmart's Crowd Savers. There are several examples of f-commerce advancements, including some interesting integrations from Amazon.

3. Smartphones consolidate and grow. More and more people will step-up to smartphones, most of which will choose iPhone, Blackberry, and Android phones. Other smartphones will vanish, and networks will start to strain. But retailers will finally embrace mobile as the next big channel. Retail marketing departments will build mobile apps without the help of their IT department, and eventually they will get into a bind.
Android has been on a tear lately stealing market share from Blackberry. Palm and Microsoft are trending down, and Apple is holding steady. Smartphone sales are up 15% and expected to continue. Retailers understand the importance of mobile, and some innovative applications have been produced this year.

4. Google helps the little guys. Google will push its Favorite Places project to help give exposure to small retailers and restaurants. They will enable small retailers to act like big ones by providing storefronts, detailed product information, and coupons for consumers. Google will find a way to bring augmented reality to the masses.
I can't say I've seen much new from Google regarding Favorite Places, but they've continued to push local product search. From the PC or smartphone, consumers can search for products and see which nearby stores have it stock. Oracle Retail even productized an integration to Google to support this effort. I suppose if Google ever buys Groupon then it will bring them even closer to local shopping. Google talked about augmented humanity, but that has nothing to do with augmented reality.

5. Steve Jobs Is Bugs Bunny and Steve Ballmer is Elmer Fudd. (OK, I stole that headline from an InformationWeek article. I couldn't resist.) Both Apple and Microsoft will continue to open new stores, but only Apple will show real growth. POSReady 2009 (formerly WEPOS) will continue to share the POS market with Linux. The iPhone and iPod will continue to capture market share, but there won't be an Apple tablet.
There won't be an Apple tablet? What was I thinking? While Apple has well over 300 stores, there are less than 10 Microsoft stores. Initial impressions show that even though Microsoft is locating its store near Apple Stores, they are not converting customers, with shoppers citing a lack of assortment and high prices.

6. Consolidation of e-commerce software providers. Software vendors in the areas of search, reviews, online call-centers, payments, and e-commerce will consolidate, partly driven by the success of m-commerce and SaaS. Amazon will find someone else to buy, and eBay will continue to lose momentum.
Consolidation of e-commerce providers continued with IBM acquiring Sterling Commerce and CoreMetrics, and Oracle recently announcing the acquisition of ATG. Amazon grabbed Zappos, Woot, and Diapers.com to continue its dominance of online selling. While eBay's Marketplace growth may have slowed, its PayPal division is doing quite well, fueled in part by demand for mobile payments.

7. Book publishers mirror music labels. Just as the iPod brought digital downloads to the masses, the Kindle and Nook will power the e-book revolution. Books will continue to use DRM for a few more years before following the path of music. Publishers will try to preserve the margins of hardbacks by associating e-book releases with paperbacks.
Amazon has done a good job providing e-reader clients for smartphones, PCs, and tablets. Competition from Barnes & Noble has forced Amazon to support book loaning, and both companies are making it easier for people to publish ebooks (with or without DRM). Progress is slow but steady.

8. NFC makes inroads, RFID treads water. Near Field Communications start to appear in mobile phones, and retailers beta test its use for payments and loyalty programs. RFID tag costs come down a bit, but not enough to spur accelerated adoption.
Nokia announced plans to offer NFC-enabled phones in 2011, and rumors are swirling about NFC in the upcoming iPhone.  I think NFC is heading in the right direction, and I've heard more interest from retailers about specialized uses for RFID.

9. Digital Signage goes the way of augmented reality. People use their camera phones to leave geo-tagged notes all over cities, rating stores and restaurants, and "painting" graffiti. But people get tired of holding their phones in front of their faces, so AR glasses are offered in much the same way bluetooth headsets emerged. Retailers experiement with in-store advertising using AR.
Several retailers like Pizza Hut, Benetton, and Target have experimented with AR but its still somewhat of a gimmick used by marketing.  I think this prediction is a year or two too early.

10. JDA flip-flops again. After announcing their embracing of the .Net architecture, then switching to J2EE after the Manugistics acquisition, JDA will finally decide to standardize on Apple's Objective C. Everything will be ported to the iPhone and be available on the AppStore. After all, there's not much left to try.
This was, of course, a joke but the sentiment is still valid.  JDA seems more supply-chain focused than retail focused, which is a an outcrop if their i2 acquisition. 

Of the 10 predictions, I'm going to say I got 6 somewhat correct.  (Don't you just love grading your own paper?)  Soon I'll post my predictions for 2011 so be on the lookout.  Until then here's one more prediction:  Va Tech beats Stanford in the Orange Bowl -- count on it!



Good stuff. For fun, I'll make a minor quibble with #5. As a percentage of total stores MS opened more than Apple this year, and certainly grew faster than Apple (in it's first year of retail growth). MS retail success is insignificant compared to Apples, but if you visit any mall with both stores, you'll find both stores equally busy, and at the MS (cough) "guru bar" (cough), you'll see a row of shiny new Macs purchased from Apple and then carried to the MS store to have windows installed. :)


Jason aka Retailgeek

Posted by Jason Goldberg on December 14, 2010 at 09:31 AM PST #

To be honest, I've not had the pleasure of visiting a MS store yet and thus am relying completely on hearsay, but I am looking forward to my first guru bar encounter.

Jason, any big predictions for 2011?

Posted by David Dorf on December 14, 2010 at 09:41 AM PST #

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