Issues Monitor: July 2011, Volume Ten | 7 “formed. All of this is delivering greater will play an important role in futurebusiness benefits with reduced cost retail operations.39 In February 2011,of operation and increased profits US-based department store Macy’s As technologyfor retailers.37 started rolling out item-level RFID tends to change technology across seven stores in constantly, retailers• In January 2011, with the help of the US. It started tagging various are witnessing a UK-based in-store communications product categories — including clear transformation technology company Pierhouse, men’s jeans and women’s lingerie in the retail IT Waitrose revamped its in-store — that are typically high-margin landscape. pricing system with a new digital items whose inventory is difficult to signage solution called Netticket. manage.40 With this solution, Waitrose was able to set up a pricing database • Cloud computing is another that enables it to determine technology that is expected to in-store shelf prices immediately. change the retail landscape, owing It can also send marketing and to its high computing power and price information to customers’ significantly lower cost. With this mobile devices, in-store screens technology, information, software and social media platforms such as applications, operating systems Twitter. The solution also collates and hardware infrastructure, as detailed information on products, well as servers and storage units, including package size, content are shared over the internet.41 For and ingredients.38 example, using Microsoft’s cloud computing solution, REEDS, a• In order to meet future challenges, full-service jewelry retailer retailers also need to keep operating online and in 16 US exploiting technology. Technology states, reduced its infrastructure developments such as radio costs by 90 percent and e-mail frequency identification (RFID) tags support work by 80 percent.42
Issues Monitor: July 2011, Volume Ten | 13Figure 4 shows the revenue growth trends for the top luxury groups.Figure 4: Revenues of top five global luxury groups (US$ billion) 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Polo Ralph Lauren Luxottica Group Richemont PPR LVMHSource: Company websites and Capital IQNotes: The top five global luxury groups have been listed on the basis of their revenues.Q1 2011 revenues for Ralph Lauren and Richemont have not yet been announced.The dip in Q1 2011 revenues for LVMH and PPR was due to the high growth in sales during the festive season in the previous quarter.
24 | Issues Monitor: July 2011, Volume TenType of m-Commerce initiatives usedby retailers .Large retailers without an m-Commerce initiative are a minority. In fact, all majorretailers now have some form of m-Commerce strategy in place — ranging froma sophisticated electronic wallet* to the basic short messaging service (SMS)outbound advertising program. Figure 7 gives a snapshot of the penetration ofm-Commerce in the US.Figure 7: Spread of m-Commerce in US 39% 24% 10% 20% 7% Widely implemented a strategy Rapidly expanding strategy Initiated pilot programs Evaluating strategies No strategyForbes InsightNote: The findings are based on a 2010 Forbes survey of 300 US retailers with multiple locations and annual revenues of US$100 million or more.* Mobile devices linked to debit or credit cards with the ability to purchase items and pay bills.