- 31 Jul
Why retailers must invest in tech
Despite headlines being dogged by Brexit woes, and consumer-confidence lows, the current underlying message begs more attention: businesses must invest in tech, or get left behind.
Invest for the future
Commenting to Retail Week, Sunday Times economics editor, David Smith, summed up the sentiment: “good companies invest when others don’t and seize the opportunity. If you wait until everything is right then it is probably too late.”
The challenge for retailers is to invest in their products, people and systems, no matter what the external backdrop.
And what better poster-child for technology investment news than Amazon?
It’s been a busy week for Amazon UK, as they unveiled shiny new 600,000 sq ft headquarters in Shoreditch, which will house its research and development teams. As part of Amazon’s push to expand its UK workforce, the company plans to double its technology team in London from 450 to 900 by the end of 2017. Since 2010, Amazon has invested £6.4bn into research in the UK.
In line with the “London is Open” message, this development completely nullifies the impact of Brexit on business’ ability to secure top tech talent in the UK.
Innovating for the customer
Whilst new Amazon staff in Shoreditch will be developing its Prime video service, in other areas, there have been big leaps in AI with Alexa innovation.
If you have one of Amazon’s voice activated personal assistant devices, you’ll understand the frustrations of holding a “normal” conversation with Alexa: attempting to go beyond a weather update, or calling for the lights to be switched off, is currently asking for frustration. However, Amazon says that rapid progress is being made behind the scenes.
As well as updates to Amazon Echo’s skill set – 37 times more than Google’s – the Amazon Echo family recently introduced two new models. One has a built-in screen, the other – still in test mode – is designed with two cameras to make recommendations about what you should wear, based on the user modelling outfit choices in front of the device.
Amazon’s UK boss, Dave Limp, commented to the BBC: “The ability to have a machine-learning algorithm distinguish through Style Check which outfit is better to wear at that particular moment, is just mind-boggling. It’s informed by human beings but the algorithms are coming along quite nicely – I’m very optimistic that this is a problem that can be completely solved by machine learning.
“The thing I am sure of is that this time next year she will be significantly more intelligent than she is now, and that sometime in the future we will hit our goal of reinventing the Star Trek computer.”
Another example in the fashion retail sphere is ASOS. It’s no coincidence that the pureplay etailer’s continued growing sales and profits come after launching more than 300 tech releases in the last quarter alone.
What to take from this?
Albeit tongue in cheek, Amazon’s goal to create a Star Trek supercomputer is pretty lofty. But, why not? Both Amazon and ASOS invest in tech to improve their customer experience, and share a common goal: they have the end in mind.
According to recent research, 86% of retailers are not happy with their ability to offer omnichannel. We’re supporting leading brands, including ASOS, to start with the end in mind, and invest in technology that matters, such as their supply chain operations.
For retailers, it is critical that they not only have full visibility of their stock in order to maximise profitability through omnichannel, but that they also invest in order to thrive.
For more retail technology insights, look out for our new whitepaper – What is Omnichannel Retailing? – launching in the coming weeks.