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Survey of Retail CIO’s shows specialists are changing IT priorities to compete more effectively.

Aldata Solution, a global leader in retail and distribution improvement software, today reveals that mid-size retailers, are being affected much more than larger retailers by the economic downturn, according to its 2011 Global Retail CIO Survey. To combat this threat, mid-sized retailers are reacting fast and are investing more to get closer to their customers, with close to a quarter prioritizing IT spend on store and ERP systems, as well as solutions available through the Cloud which will address this challenge.

Economy keeps retailers awake at night
The research of more than 130 retail CIOs globally, conducted by retail research specialist Martec, reveals that almost double the amount of mid-size retailers (38%), consider the economy to be the biggest issue affecting their business, compared to only 22% of all retailers.

Allan Davies, EVP Market Development at Aldata Solution comments: “Being a mid-sized retailer has never been harder than it is today, but a key differentiator is the close relationship they can have with their customers by being more local and this is where the larger retailers are trying to play catch up. The old 80-20 rule is still valid and retailers able to pinpoint the 20% of customers generating 80% of their revenues will be able to serve better and make more money.”

Specialist retailers more open to new technologies
As rising costs threaten specialist stores it seems that they are turning to new systems to drive efficiencies, with almost double (20%) planning to invest in ERP and cloud computing (15%), compared to 11% and 5% of all retailers, in a bid to improve store-based customer service and to reduce their existing IT costs.

Dilip Popat, Industry Principal, Retail and Distribution, Microsoft Business Solutions added: “Mid-size retailers are looking at a new generation of connected IT solutions because their existing software is not giving them the visibility, integration, or ROI that they need to compete effectively in these tougher times.”

Customer dedication by Veikon Kone
One example of a mid-sized retailer serving and retaining its customers is exclusive Finnish retailer Veikon Kone. The 20 strong electronics chain recently implemented Aldata’s new digital loyalty systems, which enabled them to focus tailored offers to specific customer groups via their preferred communications channels (email, SMS, direct mail, phone). They saw a major upswing in sales from both existing and new customer introductions.

Davies concludes: “The survey clearly shows that specialist retailers are prepared to take on the ‘major players’ in the fight for customers and while they are being hit hard by the economy they are finding new and different ways to retain and win new customers. The next phase of retail IT innovation is being driven by necessity and mid-size retailers are leading the way.”

Methodology
The Aldata Global Retail CIO Survey was conducted by retail industry research specialists Martec International to assist retailers in benchmarking their IT strategy and use of technology against their peers. The 2011 Global Retail CIO Survey incorporates the views of retailers from 26 countries generating from US$50 million in annual revenue, whose combined sales represent $555 billion from more than 117,000 stores. This equates to 8 percent of the total retail market in the Americas and Europe by sales. A total of 136 CIOs and IT directors in category-management-style retailers were interviewed for this report. Participants included a mix of both food and non-food retailers from across the Americas and Europe. The survey provides insights into current retail spending plans and priorities.

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