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Retailers That Readily Adopt Digital Technologies Outperform Competitors

Retailers that have readily adopted digital technologies have experienced a 6% CAGR revenue growth over a 3-year period, while other retailers that have explored digital without a full commitment to broad implementation experienced flat growth over the same period, according to the 2018 Retail Industry Digital Adoption Survey, a new independent survey from NSU Technologies, LLC and sponsored by Software AG, titled


The retail early adopters, known as Digital Leaders, also had a higher average price-to-earnings ratio of 22.32 versus 12.22 for Digital Explorers, per the report.

In addition to outperforming their peers, the Digital Leaders are already reaping the benefits from improved customer engagement and operational efficiencies born from digital adoption while capitalizing early on changing trends and customer buying patterns.

While the retail industry is still in the early stages of digital transformation adoption, there is evidence that the speed of adoption is increasing. 75 percent of respondents expect digital technologies to increase their annual IT budget for 2019, and retail IT organizations adopt new tools and techniques to increase throughput and improve customer responsiveness.

Still, many retailers are not moving their digital transformation strategies quickly enough to keep pace with Amazon and other disruptors. In fact, 38 percent of respondents reported they have not yet started on a broader scale of implementing digital technologies.

Delays and cost overruns have also stalled digital adoption for retailers with 75 percent of respondents citing issues with both. 50 percent stated the delays were a result of a lack of complete or well-understood requirements, while an additional 19 percent indicated that a lack of digital expertise was the root cause of delays.

Regarding in-house digital talent, only 25 percent of respondents noted they had the majority of skills needed to deploy digital technologies already on board. Of those without the required skills, the majority of respondents planned to augment via external labor while others will leverage managed services or outsourcing to complete digital efforts.

The survey also further revealed more distinct differences between the Digital Leaders and the Digital Explorers regarding the rate of digital transformation in the retail sector. The Digital Leaders benefited from CEO endorsement of a strong enterprise digital strategy, a corporate culture supportive of digital adoption and Boards of Directors with technical expertise, while the Digital Explorers suffered from limited involvement at the executive level as well as an incomplete or poorly defined strategy. This had a direct impact on overall revenues, market share growth and competitiveness in an increasingly uncertain retail climate for both parties.

“Retail Digital Leaders are already investing in key enabling technologies such as artificial intelligence (AI), Big Data, Agile and DevOps as well as the Internet of Things (IoT) to meet the changing demands of today’s discriminating, empowered shoppers,“ said Oliver Guy, Global Industry Director, Retail, Software AG. “We found that the retailers that are thriving in a challenging environment have a number of things in common: they have adopted service-oriented architectures and an independent integration platform in order to insulate themselves from change and to increase agility to try new things. They realized, early on, the need to increase technology throughput to keep pace with rapidly changing business demands and are thus realizing greater profitability than the Digital Explorers.“

Guy also noted, “The Digital Leaders investing in specific digital deployments such as IoT, big data and advanced analytics are optimistic about the business benefits they will yield. 87 percent of respondents with physical stores are deploying or planning to deploy a variant of IoT technology. What was also interesting is that Digital Leaders were more than twice as likely to view their IT organization as a trusted provider.”

Big data and advanced analytics continue to be extremely important to retailers, more so than blockchain investments, which received the least amount of attention than any of the digital technologies in the survey.

81 percent of those queried were either active with, or preparing for, Big Data deployments with 94 percent doing the same for advanced analytics. In fact, 44 percent of respondents found advanced analytics deployment to be the most challenging digital technology to deploy across the enterprise.

Lastly, only six percent of respondents indicated that they were actively deploying blockchain while another 19 percent had plans to start a blockchain project.

100 percent of respondents already have efforts underway to improve customer experience

Not surprisingly, (CX), with 94 percent expecting to increase CX efforts in 2019. These efforts will focus on the gamut of e-commerce, mobile and stores. Retailers continue to invest heavily in e-commerce, with 75 percent of respondents stating their e-commerce CX is on-par or ahead of their competitors, versus 62 percent for mobile CX and 67 percent for in-store CX. CX was the area of digital adoption that provided the best results to retailers thus far with 57 percent of respondents stating that their CX initiatives were already delivering tangible business benefits.

Survey results also show that respondents are very optimistic about potential benefits from deploying digital technologies in specific retail business areas. 100 percent of respondents expect to receive benefits in Marketing/Customer Engagement and E-Commerce/Omni-Channel, while 94 percent expect to receive benefits in Store Operations/Labor Management and Merchandising/Assortment Planning. However, only 44 percent expect to see digital create benefits for Real Estate and Store Construction.

About the Survey: The 2018 Retail Industry Digital Adoption Survey queried 100 major retailers with 80 percent of those organizations having annual revenues in excess of $1B (USD). 69 percent of those surveyed operate only in the U.S. 38 percent of those surveyed operate over 1,000 stores, while 56 percent operate less than 200 stores. 63 percent of respondents are publicly traded retailers, while 37 percent are privately held. Nine different retail sectors are represented in this survey: fashion, sports & leisure, home & DIY, health & beauty, general merchandise, food, electronics, auto & auto parts and specialty merchandise.

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Retailers That Readily Adopt Digital Technologies Outperform Competitors

Retailers that have readily adopted digital technologies have experienced a 6% CAGR revenue growth over a 3-year period, while other retailers that have explored digital without a full commitment to broad implementation experienced flat growth over the same period, according to the 2018 Retail Industry Digital Adoption Survey, a new independent survey from NSU Technologies, LLC and sponsored by Software AG, titled


The retail early adopters, known as Digital Leaders, also had a higher average price-to-earnings ratio of 22.32 versus 12.22 for Digital Explorers, per the report.

In addition to outperforming their peers, the Digital Leaders are already reaping the benefits from improved customer engagement and operational efficiencies born from digital adoption while capitalizing early on changing trends and customer buying patterns.

While the retail industry is still in the early stages of digital transformation adoption, there is evidence that the speed of adoption is increasing. 75 percent of respondents expect digital technologies to increase their annual IT budget for 2019, and retail IT organizations adopt new tools and techniques to increase throughput and improve customer responsiveness.

Still, many retailers are not moving their digital transformation strategies quickly enough to keep pace with Amazon and other disruptors. In fact, 38 percent of respondents reported they have not yet started on a broader scale of implementing digital technologies.

Delays and cost overruns have also stalled digital adoption for retailers with 75 percent of respondents citing issues with both. 50 percent stated the delays were a result of a lack of complete or well-understood requirements, while an additional 19 percent indicated that a lack of digital expertise was the root cause of delays.

Regarding in-house digital talent, only 25 percent of respondents noted they had the majority of skills needed to deploy digital technologies already on board. Of those without the required skills, the majority of respondents planned to augment via external labor while others will leverage managed services or outsourcing to complete digital efforts.

The survey also further revealed more distinct differences between the Digital Leaders and the Digital Explorers regarding the rate of digital transformation in the retail sector. The Digital Leaders benefited from CEO endorsement of a strong enterprise digital strategy, a corporate culture supportive of digital adoption and Boards of Directors with technical expertise, while the Digital Explorers suffered from limited involvement at the executive level as well as an incomplete or poorly defined strategy. This had a direct impact on overall revenues, market share growth and competitiveness in an increasingly uncertain retail climate for both parties.

“Retail Digital Leaders are already investing in key enabling technologies such as artificial intelligence (AI), Big Data, Agile and DevOps as well as the Internet of Things (IoT) to meet the changing demands of today’s discriminating, empowered shoppers,“ said Oliver Guy, Global Industry Director, Retail, Software AG. “We found that the retailers that are thriving in a challenging environment have a number of things in common: they have adopted service-oriented architectures and an independent integration platform in order to insulate themselves from change and to increase agility to try new things. They realized, early on, the need to increase technology throughput to keep pace with rapidly changing business demands and are thus realizing greater profitability than the Digital Explorers.“

Guy also noted, “The Digital Leaders investing in specific digital deployments such as IoT, big data and advanced analytics are optimistic about the business benefits they will yield. 87 percent of respondents with physical stores are deploying or planning to deploy a variant of IoT technology. What was also interesting is that Digital Leaders were more than twice as likely to view their IT organization as a trusted provider.”

Big data and advanced analytics continue to be extremely important to retailers, more so than blockchain investments, which received the least amount of attention than any of the digital technologies in the survey.

81 percent of those queried were either active with, or preparing for, Big Data deployments with 94 percent doing the same for advanced analytics. In fact, 44 percent of respondents found advanced analytics deployment to be the most challenging digital technology to deploy across the enterprise.

Lastly, only six percent of respondents indicated that they were actively deploying blockchain while another 19 percent had plans to start a blockchain project.

100 percent of respondents already have efforts underway to improve customer experience

Not surprisingly, (CX), with 94 percent expecting to increase CX efforts in 2019. These efforts will focus on the gamut of e-commerce, mobile and stores. Retailers continue to invest heavily in e-commerce, with 75 percent of respondents stating their e-commerce CX is on-par or ahead of their competitors, versus 62 percent for mobile CX and 67 percent for in-store CX. CX was the area of digital adoption that provided the best results to retailers thus far with 57 percent of respondents stating that their CX initiatives were already delivering tangible business benefits.

Survey results also show that respondents are very optimistic about potential benefits from deploying digital technologies in specific retail business areas. 100 percent of respondents expect to receive benefits in Marketing/Customer Engagement and E-Commerce/Omni-Channel, while 94 percent expect to receive benefits in Store Operations/Labor Management and Merchandising/Assortment Planning. However, only 44 percent expect to see digital create benefits for Real Estate and Store Construction.

About the Survey: The 2018 Retail Industry Digital Adoption Survey queried 100 major retailers with 80 percent of those organizations having annual revenues in excess of $1B (USD). 69 percent of those surveyed operate only in the U.S. 38 percent of those surveyed operate over 1,000 stores, while 56 percent operate less than 200 stores. 63 percent of respondents are publicly traded retailers, while 37 percent are privately held. Nine different retail sectors are represented in this survey: fashion, sports & leisure, home & DIY, health & beauty, general merchandise, food, electronics, auto & auto parts and specialty merchandise.

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Kubernetes was not initially designed with AI's vast resource variability in mind, and the rapid rise of AI has exposed Kubernetes limitations, particularly when it comes to cost and resource efficiency. Indeed, AI workloads differ from traditional applications in that they require a staggering amount and variety of compute resources, and their consumption is far less consistent than traditional workloads ... Considering the speed of AI innovation, teams cannot afford to be bogged down by these constant infrastructure concerns. A solution is needed ...

AI is the catalyst for significant investment in data teams as enterprises require higher-quality data to power their AI applications, according to the State of Analytics Engineering Report from dbt Labs ...

Misaligned architecture can lead to business consequences, with 93% of respondents reporting negative outcomes such as service disruptions, high operational costs and security challenges ...

A Gartner analyst recently suggested that GenAI tools could create 25% time savings for network operational teams. Where might these time savings come from? How are GenAI tools helping NetOps teams today, and what other tasks might they take on in the future as models continue improving? In general, these savings come from automating or streamlining manual NetOps tasks ...

IT and line-of-business teams are increasingly aligned in their efforts to close the data gap and drive greater collaboration to alleviate IT bottlenecks and offload growing demands on IT teams, according to The 2025 Automation Benchmark Report: Insights from IT Leaders on Enterprise Automation & the Future of AI-Driven Businesses from Jitterbit ...

A large majority (86%) of data management and AI decision makers cite protecting data privacy as a top concern, with 76% of respondents citing ROI on data privacy and AI initiatives across their organization, according to a new Harris Poll from Collibra ...

According to Gartner, Inc. the following six trends will shape the future of cloud over the next four years, ultimately resulting in new ways of working that are digital in nature and transformative in impact ...

2020 was the equivalent of a wedding with a top-shelf open bar. As businesses scrambled to adjust to remote work, digital transformation accelerated at breakneck speed. New software categories emerged overnight. Tech stacks ballooned with all sorts of SaaS apps solving ALL the problems — often with little oversight or long-term integration planning, and yes frequently a lot of duplicated functionality ... But now the music's faded. The lights are on. Everyone from the CIO to the CFO is checking the bill. Welcome to the Great SaaS Hangover ...

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