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5 Lessons Learned from the 2024 Observability for Retail Report

Nic Benders
Chief Technical Strategist
New Relic

In the heat of the holiday online shopping rush, retailers face persistent challenges such as increased web traffic or cyber threats that can lead to high-impact outages. With profit margins under high pressure, retailers are prioritizing strategic investments to help drive business value while improving the customer experience.

Published in October, New Relic's 2024 Observability Forecast Report reveals insights into key growth areas, challenges, and trends shaping the observability industry. The report surveyed IT professionals across numerous geographic locations and demographics to inform the understanding of the current state of observability. Of the 1,700 technology professionals surveyed, 148 were associated with the retail industry and consumer-centric sectors.

Image
New Relic Retail

 

This November, New Relic published the State of Observability for Retail Report to share insights about observability's adoption and business impact across the retail industry and consumer-centric sectors.

Here are five key lessons learned from the report:

1. Observability helps retailers respond to outages faster and maintain positive business outcomes

Retailers that utilize observability to deliver business value gain an edge over their competitors. As retail organizations prepare for heightened demand during shopping periods like Black Friday and Cyber Monday, observability solutions help them tackle daily challenges, from mitigating application downtime to optimizing the online customer journey.

The forecast revealed that retailers experienced IT outages with a median annual downtime of 164 hours — or about one week. Though this is 41% lower than other industries, outages can cost organizations up to $1.9 million for every hour of downtime.

However, adopting alerts (62%) and network monitoring (59%) has helped retailers respond better to outages, with a median MTTD (mean-time-to-detection) of only 32 minutes. Further, improvements in network monitoring resulted in only 27% of respondents experiencing high-impact outages weekly. Adopting observability tooling has helped retail organizations maintain positive business outcomes and enhanced customer satisfaction.

2. AI, IoT, and security are driving retailers to adopt observability

In a year of growth, just under half (46%) of retail organizations indicated that an increased focus on security, governance, risk, and compliance was the top technology strategy influencing observability adoption.

Additionally, as AI continues on its meteoric rise, it has remained a significant driver of observability adoption, with 39% of retail respondents identifying AI as a key reason to adopt observability. This trend reflects the sector's commitment to leveraging AI for multiple facets of their work, such as enhancing decision-making and deriving actionable customer insights.

Finally, retail organizations cited IoT as the third most popular driver of observability adoption (32%), underscoring the sector's desire to harness observability for operational excellence.

3. Digital Experience Monitoring (DEM) is on the rise

A large uptick in online shopping has led to an evolved customer journey, meaning digital experience monitoring (DEM) is now a key growth area among retail organizations. DEM combines real user monitoring (RUM) — which covers browser and mobile monitoring — with synthetic monitoring for proactive testing and improvement.

More than half of the respondents (52%) noted that they are preparing to deploy synthetic monitoring within three years, 49% anticipate deploying mobile monitoring, and 42% plan to implement browser monitoring to continue to optimize the online customer journey.

4. The journey to full-stack observability requires tool consolidation

Retail organizations have their sights set on achieving full-stack observability. Though just 18% of organizations have reached this key milestone, retailers are taking strategic steps to overcome issues like an influx of monitoring tools and siloed data, which 35% of retailers identified as major roadblocks on their journey to achieving full-stack observability.

However, some retailers are transitioning through tool consolidation, with retail organizations now using 4.4 tools on average, down from 5.4 in 2023, compared to the broader industry average of 4.5 tools. This proactive tool consolidation effort will support retailers on their way to full-stack observability, with nearly half (43%) of the organizations surveyed planning to further consolidate their observability investments within the next year to access more operational efficiency and maximize their ROI.

5. Investment in observability pays off

Retail organizations reported stronger investments in observability on average, with 74% of respondents indicating annual spending of $1 million or more, while just 2% allocated less than $100,000. This investment delivers significant returns, with retail organizations achieving a median annual return on investment (ROI) of 302%, which is 4x their spending. This further underscores the strategic value of observability in this sector.

In terms of benefits, just under half of respondents (48%) reported improvements in overall system uptime and reliability, while 43% reported a reduction in security risks. Other key benefits called out included operational efficiency (38%), developer productivity (37%), and enhanced customer experience (37%).

Nic Benders is Chief Technical Strategist at New Relic

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5 Lessons Learned from the 2024 Observability for Retail Report

Nic Benders
Chief Technical Strategist
New Relic

In the heat of the holiday online shopping rush, retailers face persistent challenges such as increased web traffic or cyber threats that can lead to high-impact outages. With profit margins under high pressure, retailers are prioritizing strategic investments to help drive business value while improving the customer experience.

Published in October, New Relic's 2024 Observability Forecast Report reveals insights into key growth areas, challenges, and trends shaping the observability industry. The report surveyed IT professionals across numerous geographic locations and demographics to inform the understanding of the current state of observability. Of the 1,700 technology professionals surveyed, 148 were associated with the retail industry and consumer-centric sectors.

Image
New Relic Retail

 

This November, New Relic published the State of Observability for Retail Report to share insights about observability's adoption and business impact across the retail industry and consumer-centric sectors.

Here are five key lessons learned from the report:

1. Observability helps retailers respond to outages faster and maintain positive business outcomes

Retailers that utilize observability to deliver business value gain an edge over their competitors. As retail organizations prepare for heightened demand during shopping periods like Black Friday and Cyber Monday, observability solutions help them tackle daily challenges, from mitigating application downtime to optimizing the online customer journey.

The forecast revealed that retailers experienced IT outages with a median annual downtime of 164 hours — or about one week. Though this is 41% lower than other industries, outages can cost organizations up to $1.9 million for every hour of downtime.

However, adopting alerts (62%) and network monitoring (59%) has helped retailers respond better to outages, with a median MTTD (mean-time-to-detection) of only 32 minutes. Further, improvements in network monitoring resulted in only 27% of respondents experiencing high-impact outages weekly. Adopting observability tooling has helped retail organizations maintain positive business outcomes and enhanced customer satisfaction.

2. AI, IoT, and security are driving retailers to adopt observability

In a year of growth, just under half (46%) of retail organizations indicated that an increased focus on security, governance, risk, and compliance was the top technology strategy influencing observability adoption.

Additionally, as AI continues on its meteoric rise, it has remained a significant driver of observability adoption, with 39% of retail respondents identifying AI as a key reason to adopt observability. This trend reflects the sector's commitment to leveraging AI for multiple facets of their work, such as enhancing decision-making and deriving actionable customer insights.

Finally, retail organizations cited IoT as the third most popular driver of observability adoption (32%), underscoring the sector's desire to harness observability for operational excellence.

3. Digital Experience Monitoring (DEM) is on the rise

A large uptick in online shopping has led to an evolved customer journey, meaning digital experience monitoring (DEM) is now a key growth area among retail organizations. DEM combines real user monitoring (RUM) — which covers browser and mobile monitoring — with synthetic monitoring for proactive testing and improvement.

More than half of the respondents (52%) noted that they are preparing to deploy synthetic monitoring within three years, 49% anticipate deploying mobile monitoring, and 42% plan to implement browser monitoring to continue to optimize the online customer journey.

4. The journey to full-stack observability requires tool consolidation

Retail organizations have their sights set on achieving full-stack observability. Though just 18% of organizations have reached this key milestone, retailers are taking strategic steps to overcome issues like an influx of monitoring tools and siloed data, which 35% of retailers identified as major roadblocks on their journey to achieving full-stack observability.

However, some retailers are transitioning through tool consolidation, with retail organizations now using 4.4 tools on average, down from 5.4 in 2023, compared to the broader industry average of 4.5 tools. This proactive tool consolidation effort will support retailers on their way to full-stack observability, with nearly half (43%) of the organizations surveyed planning to further consolidate their observability investments within the next year to access more operational efficiency and maximize their ROI.

5. Investment in observability pays off

Retail organizations reported stronger investments in observability on average, with 74% of respondents indicating annual spending of $1 million or more, while just 2% allocated less than $100,000. This investment delivers significant returns, with retail organizations achieving a median annual return on investment (ROI) of 302%, which is 4x their spending. This further underscores the strategic value of observability in this sector.

In terms of benefits, just under half of respondents (48%) reported improvements in overall system uptime and reliability, while 43% reported a reduction in security risks. Other key benefits called out included operational efficiency (38%), developer productivity (37%), and enhanced customer experience (37%).

Nic Benders is Chief Technical Strategist at New Relic

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Businesses that face downtime or outages risk financial and reputational damage, as well as reducing partner, shareholder, and customer trust. One of the major challenges that enterprises face is implementing a robust business continuity plan. What's the solution? The answer may lie in disaster recovery tactics such as truly immutable storage and regular disaster recovery testing ...

IT spending is expected to jump nearly 10% in 2025, and organizations are now facing pressure to manage costs without slowing down critical functions like observability. To meet the challenge, leaders are turning to smarter, more cost effective business strategies. Enter stage right: OpenTelemetry, the missing piece of the puzzle that is no longer just an option but rather a strategic advantage ...

Amidst the threat of cyberhacks and data breaches, companies install several security measures to keep their business safely afloat. These measures aim to protect businesses, employees, and crucial data. Yet, employees perceive them as burdensome. Frustrated with complex logins, slow access, and constant security checks, workers decide to completely bypass all security set-ups ...

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Cloudbrink's Personal SASE services provide last-mile acceleration and reduction in latency

In MEAN TIME TO INSIGHT Episode 13, Shamus McGillicuddy, VP of Research, Network Infrastructure and Operations, at EMA discusses hybrid multi-cloud networking strategy ... 

In high-traffic environments, the sheer volume and unpredictable nature of network incidents can quickly overwhelm even the most skilled teams, hindering their ability to react swiftly and effectively, potentially impacting service availability and overall business performance. This is where closed-loop remediation comes into the picture: an IT management concept designed to address the escalating complexity of modern networks ...

In 2025, enterprise workflows are undergoing a seismic shift. Propelled by breakthroughs in generative AI (GenAI), large language models (LLMs), and natural language processing (NLP), a new paradigm is emerging — agentic AI. This technology is not just automating tasks; it's reimagining how organizations make decisions, engage customers, and operate at scale ...

In the early days of the cloud revolution, business leaders perceived cloud services as a means of sidelining IT organizations. IT was too slow, too expensive, or incapable of supporting new technologies. With a team of developers, line of business managers could deploy new applications and services in the cloud. IT has been fighting to retake control ever since. Today, IT is back in the driver's seat, according to new research by Enterprise Management Associates (EMA) ...

In today's fast-paced and increasingly complex network environments, Network Operations Centers (NOCs) are the backbone of ensuring continuous uptime, smooth service delivery, and rapid issue resolution. However, the challenges faced by NOC teams are only growing. In a recent study, 78% state network complexity has grown significantly over the last few years while 84% regularly learn about network issues from users. It is imperative we adopt a new approach to managing today's network experiences ...

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