Report Shares Data on Retailers’ Technology Buying Processes
As part of Total Retail's recently released 2019 Retail Technology Report, we surveyed retail executives on a variety of technology-related topics, including the processes within their organizations for investing in new technology. We wanted to know, among other things, how long the buying process takes, on average; how many service providers they're considering for a moderate to major technology purchase; and what they're relying on to learn about the latest technologies available to them in the marketplace. Here are some of the key findings from that survey, which was conducted in this year's second quarter and yielded 100-plus respondents.
Purchase Decisions Made With Sense of Urgency
When asked how long, on average, the vendor selection process takes for a moderate to major technology purchase at their company, 83 percent of retailers said that it takes less than a year. That’s a slight increase from our 2018 survey, when 80 percent said they’re making moderate to major technology purchases in less than a year.
This data reflects the speed at which the retail industry is evolving, and the growing influence of technology. In order to keep pace with innovative, digital-native direct-to-consumer (D-to-C) brands, including Amazon.com, traditional brick-and-mortar retailers have had to embrace change — and do so quickly. This extends to their technology buying processes for all facets of their organizations.
The Consideration Set
Given the substantial investments of time and money that come with purchasing new technology systems and solutions for a retail organization, it makes sense that executives would want to consider a multitude of partner options before making a final purchase decision. Much like a consumer weighing his or her options for the purchase of a big-ticket item, businesses are shopping around for the right technology partner, which includes a combination of price, product features, support, implementation time, integration with existing systems, among other factors.
According to our survey, retailers prefer evaluating between two to five service providers for a moderate to major technology purchase. Fifty-three percent of respondents said that when evaluating a moderate to major technology purchase at their company, they consider between two to three service providers, while 34 percent consider four to five. These were by far the two most popular answer options.
Self-Driven Research Keeps Retailers Up-to-Date on Technology Innovation
When asked how their organization most often discovers new technology, 59 percent of respondents cited self-driven research. However, this is down from 67 percent in our 2018 survey. They’re also keeping abreast of innovative new solutions and systems by attending industry trade shows (41 percent) and networking with other retailers (41 percent).
Retailers are increasingly learning about new technology solutions and innovations in the space through networking with their peers. In particular, they can pick the brains of execs who have implemented a technology that they're thinking of investing in within their own organization. Here are some of the questions that are being asked — or at least should be:
- What was the implementation process like?
- How is the company using the technology?
- How does it integrate with its other existing technology solutions?
- What challenges have arisen since it went live with the technology?
- What benefits has the company realized since rolling out the technology?
- What level of support has the retailer received from its vendor partner?
Total Retail's third annual Retail Technology Report provides valuable insights into the technology landscape within the retail industry. The data collected from 100-plus retail executives serves as a road map for retailers and brands, identifying the technologies their competitors are currently investing in as well as what they’re targeting for future spend.
Download Total Retail’s 2019 Retail Technology Report today.
