ISG Provider Lens™ report sees a sharp trend
toward online shopping as customers continue buying patterns
prompted by COVID-19
More than 75% of retailers allow customers
to buy products online and pick them up in stores; 58% provide
curbside pickup, up from 4% in 2019
Consumer buying behavior, drastically changed by the COVID-19
pandemic, has U.S. retailers looking for technology providers to
help them improve customer experience both online and in-store,
according to a new report published today by Information Services
Group (ISG) (Nasdaq: III), a leading global technology research and
advisory firm.
The 2021 ISG Provider Lens™ Retail Software and Services
Report for the U.S. finds the way goods are bought and delivered is
changing rapidly in the country. More than three-quarters of retail
outlets now allow customers to buy products online and pick them up
in stores, while 58 percent of retailers provide curbside pickup,
up from 4 percent in 2019, the report notes.
E-commerce in 2021 is expected to contribute about a fifth of
overall retail revenue, up from 12 percent in 2019, the report
says.
“As we return to normalcy after the pandemic, the sudden change
in buyer behavior is having huge ramifications across the retail
industry,” said Michael Witty, a retail expert and director in the
ISG Consumer Services business. “Retailers have had to revamp their
digital engagement with customers, their physical store locations
and layouts, and their supply chains.”
The report sees retailers embracing new customer-focused website
improvements, with visual search features, digital stylists and
chatbot recommendations. Social networking has also become a direct
commerce channel, with in-app checkout on some Instagram posts.
In addition, store locations and layouts are changing as
retailers reduce their large-format mall footprints (ISG says 25
percent of existing malls are expected to close by 2022) and focus
on high-tech experience centers and pop-up shops. Low-volume and
dark stores are also becoming micro-fulfillment centers, the report
says, with some converted to no-inventory locations to facilitate
the return of merchandise purchased online.
In addition, retailers are facing a lack of visibility into
supplier inventory, and an inability to accurately forecast local
consumer demand and employee absenteeism caused by illness or
staggered work arrangements, the report says.
Retailers are struggling to ramp up transportation capacity to
meet the sharp increase in online demand, and to make up for a
shortage of raw materials, ingredients and components caused by
delays in international shipments. The report notes the need for
functional supply chain silos to evolve into an interconnected
dynamic network. This would enable more collaboration, eliminate
inefficiencies and generate real-time data for better
decision-making, the report says.
The retailers that performed well during the pandemic were the
ones that had their merchandise planning and management systems
integrated with their supply chain systems, the report adds.
The report finds many e-commerce platform providers are offering
microservices that allow for a greater degree of customization,
configuration and quicker time to market. Vendors are taking an
API- and mobile-first approach to platform building. They are also
offering many new and out-of-the-box functionalities such as
promotions, recommendation engines, progressive web applications
and loyalty programs, and leveraging machine-learning for greater
insights into customer behavior.
The report also looks at retail transformation services,
including providers that help manage merchandise and enhance the
customer experience in digital stores. Retailers are experimenting
with technologies such as algorithmic retailing, artificial
intelligence and the Internet of Things for better inventory
tracking, workforce enablement, shrinkage prevention and
operational planning, the report says.
The 2021 ISG Provider Lens™ Retail Software and Services
Report for the U.S. evaluates the capabilities of 36 providers
across five quadrants: E-commerce Platforms, Merchandise Planning
and Management Software, Retail Transformation Services, Platform
Migration Services and Managed Services.
The report names Capgemini, Cognizant, HCL, Infosys, TCS and
Wipro as leaders in three quadrants. Oracle and SAP were named
leaders in two quadrants, and Adobe (Magento), RELEX, Salesforce
and SAS were named leaders in one.
In addition, Logility and UST were named Rising Stars—companies
with “promising portfolios” and “high future potential” by ISG’s
definition—in one quadrant each.
The 2021 ISG Provider Lens™ Retail Software and Services
Report for the U.S. is available to subscribers or for one-time
purchase on this webpage.
About ISG Provider Lens™ Research
The ISG Provider Lens™ Quadrant research series is the only
service provider evaluation of its kind to combine empirical,
data-driven research and market analysis with the real-world
experience and observations of ISG's global advisory team.
Enterprises will find a wealth of detailed data and market analysis
to help guide their selection of appropriate sourcing partners,
while ISG advisors use the reports to validate their own market
knowledge and make recommendations to ISG's enterprise clients. The
research currently covers providers offering their services
globally, across Europe, as well as in the U.S., Germany,
Switzerland, the U.K., France, the Nordics, Brazil and
Australia/New Zealand, with additional markets to be added in the
future. For more information about ISG Provider Lens research,
please visit this webpage.
A companion research series, the ISG Provider Lens Archetype
reports, offer a first-of-its-kind evaluation of providers from the
perspective of specific buyer types.
About ISG
ISG (Information Services Group) (Nasdaq: III) is a leading
global technology research and advisory firm. A trusted business
partner to more than 700 clients, including more than 75 of the
world’s top 100 enterprises, ISG is committed to helping
corporations, public sector organizations, and service and
technology providers achieve operational excellence and faster
growth. The firm specializes in digital transformation services,
including automation, cloud and data analytics; sourcing advisory;
managed governance and risk services; network carrier services;
strategy and operations design; change management; market
intelligence and technology research and analysis. Founded in 2006,
and based in Stamford, Conn., ISG employs more than 1,300
digital-ready professionals operating in more than 20 countries—a
global team known for its innovative thinking, market influence,
deep industry and technology expertise, and world-class research
and analytical capabilities based on the industry’s most
comprehensive marketplace data. For more information, visit
www.isg-one.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210712005518/en/
Will Thoretz, ISG +1 203 517 3119 will.thoretz@isg-one.com
Erik Arvidson, Matter Communications for ISG +1 617 755 2985
isg@matternow.com
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