Reviewing Retail Predictions for 2011

I've been busy thinking about what 2012 and beyond will look like for retail, and I have some interesting predictions to share.  But before I go there, let’s first review this year’s predictions before making new ones for 2012.

1. Alternate Payments
We've seen several alternate payment schemes emerge over the last two years, and 2011 may be the year one of them takes hold. Any competition that can drive down fees will be good for everyone. I'm betting that Apple will add NFC chips to their next version of the iPhone, then enable payments in stores using iTunes accounts on the backend. Paypal will continue to make inroads, and Isis will announce a pilot.

The iPhone 4S did not contain an NFC chip, so we’ll have to continuing waiting for the iPhone 5. PayPal announced its moving into in-store payments, and Google launched its wallet in selected cities.  Overall I think the payment scene is heating up and that trend will continue.

2. Engineered Systems
The industry is moving toward purpose-built appliances that are optimized across the entire stack. Oracle calls these "engineered systems" and the first two examples are Exadata and Exalogic, but there are other examples from other vendors. These are particularly important to the retail industry because of the volume of data that must be processed. There should be continued adoption in 2011.

Oracle reports that Exadata is its fasting growing product, and at the recent OpenWorld it announced the SuperCluster and Exalytics products, both continuing the engineered systems trend. SAP’s HANA continues to receive attention, and IBM also seems to be moving in this direction.

3. Social Analytics
There are lots of tools that provide insight into how a brand is perceived across popular internet sites, but as far as I know, these tools are not industry specific. The next step needs to mine the data and determine how it should influence retail operations. The data needs to help retailers determine how they create promotions, which products to stock, and how to keep consumers engaged. Social data alone does not provide the answers, but its one more data point that will help retailers make better decisions. Look for some vendor consolidation to help make this happen.

In March, Salesforce.com acquired leading social monitoring vendor Radian6 and followed up with acquisitions of Heroku and Model Metrics. The notion of Social CRM seems to be going more mainstream now.

4. 2-D Barcodes
Look for more QRCodes on shelf-tags, in newspaper circulars, and on billboards. It's a great portal from the physical world into the digital one that buys us time until augmented reality matures further. Nobody wants to type "www", backslash, and ".com" on their phones.

QRCodes are everywhere. ‘Nuff said.

5. In the words of Microsoft, "To the Cloud!"
My favorite "cloud application" is Evernote. If you take notes on your work laptop, you will inevitably need those notes on your home PC. And if you manage to solve that problem, you'll need to access them from your mobile phone. Evernote stores your notes in the cloud and provides easy ways to access them. Being able to access a service from anywhere and not having to worry about backups, upgrades, etc. is great. Retailers will start to rely on cloud services, both public and private, in the coming year.

There were no shortage of announcements in this area: Amazon’s cloud-based Kindle Fire, Apple’s iCloud, Oracle’s Public Cloud, etc. I saw an interesting presentation showing how BevMo moved their systems to the cloud.  Seems like retailers are starting to consider the cloud for specific uses.

6. F-CommerceTop of Form

Move over "E" and "M" so we can introduce "F-Commerce," which should go mainstream in 2011. Already several retailers have created small stores on Facebook, and it won't be long before Facebook becomes a full-fledged channel in the omni-channel world of retail. The battle between Facebook and Google will heat up over retail, where both stand to make lots of money.

JCPenney and ASOS both put their entire catalogs on Facebook, and lots of other retailers have connected Facebook to their e-commerce site. I still think selling from the newsfeed is the best approach, and several retailers are trying that approach as well. I just don’t see Google+ as a threat to Facebook, so I think that battle is over.  I called 2011 The Year of F-Commerce, and that was probably accurate.

Its good to look back at predictions, but we also have to think about what was missed.  I didn't see Amazon entering the tablet business with such a splash, although in hindsight it was obvious. Nor did I think HP would fall so far so fast.  Look for my 2012 predictions coming soon.

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David Dorf, Sr Director Technology Strategy for Oracle Retail, shares news and ideas about the retail industry with a focus on innovation and emerging technologies.


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