Behind the Numbers of the 2020 Technology Study
It is clear that the COVID-19 pandemic has brought about technology momentum. The impacts of COVID-19 clearly show the tech influence on ways that businesses must now operate.
For those retailers participating in the 2020 Convenience Store News Technology Study who have no plans for web ordering (45 percent), this is not forward thinking. Even though a larger number said they have or will implement ordering with an app, not taking time to implement web-based consumer experiences will result in missing out on delivering a robust digital experience for customers.
An app is not enough — consumers continue to only keep an app active on their mobile device for a short period of time, or when a retailer has invested in making the app important to the overall shopping experience.
I'm somewhat surprised at the delivery services being used. It would be interesting to see how responses tie back to those respondents' foodservice offerings. Instacart has received a boost with 7-Eleven's recent partnership but many delivery services, including Instacart, still are not available in less-populated areas.
With just a few retailers (14 percent) not tracking customer feedback, I'd like to know how retailers are tracking it and then analyzing what that feedback is telling them. With half of the respondents not having data-related capabilities (i.e., an analytics platform, CRM software, etc.), this group will quickly find out that the value from their digital offer can only be realized with tools that provide consumer insights beyond demographics — namely how a consumer interacts with the retailer’s digital commerce experience.
Apparently, several retailers already realize this based on the high ranking (No. 2) given to the importance of developing greater business intelligence and reporting capabilities.
Based on projects I've been engaged with over the past year for retailers, I am not surprised to see inventory management and reducing theft/shrink being among the top business priorities. The continuing challenge of ensuring that out-of-stocks are not one of the frictions consumers feel has retailers looking for solutions to augment current back-office systems.
The ongoing loss prevention battle is an apparent opportunity for software solutions and service providers, as computer vision, artificial intelligence and data analytics are also among the areas that retailers are looking to understand and implement.
In the face of EMV-at-the-pump upgrades, it is interesting to see that less than half of respondents have adopted at-the-pump marketing technologies. Pump manufacturers have invested in developing and marketing to retailers this technology to offset the investment to meet the EMV mandate, but apparently did not convince a good portion of the industry to adopt it.
A number of the responses in this year's Technology Study indicate a movement toward additional spending on software and centralized solutions. It is likely that the drop in year-over-year capital expenditures is a result of investment in cloud, software as a service, and managed service becoming a more prevalent way to implement solutions.
Likewise, the drop in adding new hardware is likely the result of more attention to software-related systems and solutions, some of which preserve existing hardware investments. The drop in store system investment for more headquarters-based solutions could be related to the need for added security and other infrastructure investments needed to deliver and support technologies at the stores.
New to this year's study was the question of employee-facing vs. consumer-facing technologies. The split is interesting and tells me there is a realization among operators that employees are equally important as consumers and really need to be part of the solution in the digital consumer experience. This means engaging employees in new ways, using tech, from recruitment and training to retention and recognition.
Finally, the self-checkout response numbers show to me the interest by convenience retailers to innovate, stay competitive, and be more responsive to the consumer needs of today and the future. Loyalty has gone digital (40 percent have payment tied in), yet still half of this year’s respondents are relying (or not) on other means of creating loyalty and value among their customers.
Ed Collupy is president of Collupy System Solutions LLC. He has IT leadership, consulting and business team experience providing strategic, operational and project leadership to retailers, emerging businesses and technology companies. Collupy can be reached at [email protected]
Editor's note: The opinions expressed in this column are the author’s and do not necessarily reflect the views of Convenience Store News.