IT in retail of 2019 the Overview of TAdviser

The Russian retail endures deep transformation. Against the background of growth of large players of the industry the market is left by regional networks and the international companies. For the remained players of "rule of the game" Internet trade which blurs traditional bases of retail, the including debugged logistics and control over the final prices seriously changed.

The correct reaction to quickly changing situation in the market of retail gives to the retailer big advantage over competitors. The key directions of digitalization became the work with consumers including different the loyalty program and personalisation of offers, optimization of operating activities, including performance improvement of personnel, work with products and the calculation of goods and also logistics and storage of products, - Yury Vostrikov, the commercial director of NORBIT company says (enters into the Lanit group).

Interest in new technologies

In a top of requests of 2019 - robotization of business processes (RPA), HR Tech and machine learning, Sergey Osipov, the vice president of GMCS notes.

Owing to data practically all trust. According to us, retailers most often use the intellectual analysis for obtaining information on behavior and preferences of clients that allows them to adapt the offers (the price, the range, a delivery mode, etc.) and to provide to buyers the personalized experience, - he tells.

Galina of Mussin, the head of competence center in the Retail segment of ICL Group, predicts that in the next two years personification of marketing and consumer experience will become the perspective direction.

Will develop with respect thereto a segment of works on analytics of data: data were learned to be collected, but up to the end not learned to be analyzed and if learned, then so far costs for collecting and storage are higher, than advantage of their analysis on existing level, - she adds.

Victor Novinsky, the director of the department of work with insurance companies and trade enterprises of Jet Infosystems company, notes that market leaders continue to invest 5-7% of a gross profit in IT, at the same time there is a redistribution of IT budgets: expenditure for infrastructure maintenance are reduced, and on tools of a didzhitalization increase.

Interest in optimization of internal processes using artificial intelligence technologies, robotization and IoT grows despite all arising difficulties, – he tells.

Sergey Sapronov, the expert of AiTeco Group, the head of a project portfolio (the direction on software development), adds that more and more retailers begin to use modern means of communication with the buyer and employees, to build forecasts on the basis of Big Data, to start the proprietary applications including gamification and to select separate departments and digital laboratories for work with innovations.

All above-mentioned will form the development basis for the next 2 years, - he explains.

Not all are ready to invest in innovations

At the same time, as the top manager of GMCS Sergey Osipov notes, not everyone as time of measurement of efficiency from investments into already implemented technologies came are ready to increase expenses on new technologies.

What is not measured quantitatively – increases income or saves costs – as a rule, goes "to the shelf". Less creative, but from it not less important technical task, remains integration of new solutions with existing, often outdated, systems. As a rule, this task lays down on shoulders of own IT commands of the retail companies, with point attraction of outsourcing, - Sergey Osipov says.

Sergey Kosetsky, the commercial director X-Com, adds that large-scale projects of automation are not seldom postponed until the best times, at the same time focus of interest of retailers is displaced towards the solutions providing cost reduction on IT, involvement of new clients and communication with them and also generation of additional revenue.

Gennady Tarantasov, the head "Retail" of Corus Consulting Group, notes that retailers began to approach project implementation more thoughtfully and accurately: selecting solutions, they want to know precisely what value for business can be received at the expense of them. Besides, the companies give preference to contractors with wide project experience and industry expertize.

According to Maxim Melsitov, the deputy manager of department of business solutions of Softline Group, in the next two years retail will continue to develop those technologies which already began to use: solutions for management of a warehouse, predictive and video analytics, e-commerce. The demand of the Fair Sign system will grow: based on goods marking of the company will be able to create new competitive advantages in the field of traceability.

If to speak about the innovative solutions, such as shops without sellers or electronic price labels, the horizon of their transition to mass operation to me sees much higher, than two years, - the expert of Softline says.

Growth of a role of the state and breakthrough of digitalization of SMB

Maintains demand for IT solutions in retail the growing role of the state in economy. The government regulates the industry, implementing new and new initiatives: cash registers with obligatory information transfer of fiscal checks in OFD, implementation of systems UNIFIED STATE AUTOMATED INFORMATION SYSTEM and "Mercury", obligatory marking of separate types of goods, VAT size variation.

Retailers are forced to conform to the demands made by the state and to invest in the necessary automation equipment, - Gennady Tarantasov explains.

At the same time some firms are limited to accomplishment of the minimum requirements of the legislation, but most the companies try to combine necessary changes with implementation enough extensive projects of automation: someone, taking an opportunity, completely changes outdated cash software, someone replaces or cardinally modifies the main programs of operational management by the enterprise.

Anyway the last two years were "rich" in large projects of informatization. Now process continues, and I think at least 1-2 more years the subject of reduction of IT according to the changing legislation will be very relevant, - Alexander Zarzhetsky, the head of directorate of implementation of integration projects notes 1C-Rarus.

Legislative initiatives, development of mobile and contactless solutions, marketplaces of technologies – all this promotes that digitalization gets into small and medium business more and more deeply.

If until recently only the largest retailers (the international and federal retail chain stores) were engaged in digitalization, then now medium and small business joins them, - the deputy manager of department of business solutions of Softline Group Maxim Melsitov says.

For the last three years the market of retail made huge breakthrough: 2 million outlets began to use online cash desks. With the advent of category of smart terminals technologies came to Android to small business: automation of commodity accounting, assortment management and loyalty of buyers, analyst, acquiring, - Sergey Andriyashkin, the marketing director of Evotor IT company tells.

According to it, the share of smart terminals in the total amount of the Russian market of online cash desks at the end of 2018 made 13%, in 2019 it already exceeds 20% and continues to grow quickly.

As well as big retail, small business implements the marking, the Mercury system and other legislative innovations requiring use of technologies and automation. Few years ago it seemed impossible, - the marketing director of Evotor IT company adds.

Transformation of retailers into the IT companies

At the same time the market remains strongly differentiated: there are giants X5 Retail Group and "Magnet", large networks of clothes, cosmetics, pharmaceutics and another large offline - retail, and are small online stores and promptly growing marketplaces. The last are initially created as the IT companies, as for classical retailers — they also actively tsifrovizirut the processes, making teams and using services of konsalter and integrators.

Pavel Zaglumin, the head on Business Systems Development of Jet Infosystems company, predicts three directions of market development. The first is connected with penetration of retail into all communication channels with clients, integration among themselves of these channels using development or opened by SaaS tools. The second - interpenetration offline - and online trade. And the third - transformation of large retailers in the IT company through use of methods of work with data and also "design" IT solutions for process optimization and building of customer relations.

The analytical center TAdviser issued the "Information Technologies in Retail" card. Categories of IT solutions which are used by the companies of retail are reflected in it, and the IT companies developing products and rendering services for digitalization of the industry are mentioned. Chief information officers and heads of IT services of the trading companies can receive the printing version of the card in A1 format free of charge, having left the contact information in the questionnaire according to the link.

The card covered 390 players of the market – developers of IT solutions and the cash registers, the system integrators rendering different types of IT services for digitalization of business processes of the companies of retail.

Main article: Trends of IT market of Russia

Robotization of business processes of RPA

Retailers are concentrated on increase in operational efficiency and cost reduction, including — cost optimizations on IT. Recently in the Russian IT market there are popular solutions for robotization of business processes (RPA) allowing to automate accomplishment of mass routine transactions.

It is rather available technology differing in simplicity of development and deployment, fast payback. The main scopes of RPA in retail it is finance and accounting (payment processing and primary documents, data management of partners, preparation and drawing of accounts, the reporting, etc.), personnel (search of vacancies, processing of the summary, starting data on new employees, issue of admissions, the personnel reporting, etc.), logistics (monitoring of the prices, request processing, reconciliation of data, inventory management, processing of returns, etc.), sales and marketing (auto eject of leads from CRM systems, creation of reports, chat-bots in call centers, etc.).

The combination of RPA and machine learning opens doors to the world of intellectual automation when the robot allows to take and work with data for forecasting of results. In other words, as soon as the existing processes will be automated and robotic, on the basis of data new processes will come to light and be digitized, - Sergey Osipov, the vice president of GMCS notes.

Omnichannel

For improvement of customer service retailers build the omnichannel service meaning mutual integration of separate communication channels into a single system for continuous communication with the client, Yury Vostrikov, the commercial director of NORBIT company tells (enters into the Lanit group).

AiTeco Group also even more often notices that offline - retail goes to online and vice versa.

It is a certain call for the retailer as the number of scenarios of customer interaction grows in geometrical progression. To the modern buyer online is often simpler to order the necessary goods, but at the same time there is no wish to spend time for their receiving. Even more often among requests of our clients we see implementation of the scenarios Click&Collect and Click&Reserve. Offline stores begin to turn into small distribution centers and Pick-up of a point gradually. All this requires implementation of new products and business processes which are inseparably linked with information technologies. The cash desk (more precisely than POS – Point of sale) begins to turn into "supercomputer", interacting with a huge number of web services - from online store and the warehouse systems before logistics services and loyalty systems, - the expert of AiTeco Group Sergey Sapronov says.

Traditional retailers cannot ignore the trend connected with e-commerce, as a result of border between offline and online are gradually blurred. Access to the network means reorganization for them including warehouse and transport logistics: it begins to work by other principles.

Expenses on automation of logistics make a considerable part of IT expenses of the retail companies: the largest players perform redesign of the logistic infrastructure when everything miscalculates with our help, beginning from location of the distribution centers (DC) and finishing with how they will be connected with other warehouses and outlets. All this works for efficiency and cost reduction, today it is a big call for the companies, - Gennady Tarantasov, the head "Retail" of Corus Consulting Group says.

The personalized loyalty

At buyers the request for the personalized interaction with a brand grows. They want that the company based the marketing activities, proceeding from the history of their purchases, offered the personalized discounts on the basis of his preferences and also considered the history of its previous purchases.

In fight for the buyer it is already not enough to retailer to allow a discount for group of goods or to announce a seasonal sale. The retailer understands that now the sales increase becomes possible only thanks to personalisation.

Point of making decision on a visit of shop or the order in this or that shop for the client are actions and discounts for goods from his consumer basket, but not a "season of discounts". For example, if I am not a fisherman, I in much smaller degree will be interested in an essential discount for a spinning, than a small discount, for example, for glazed cheese curd, - Sergey Sapronov explains.

The top companies rebuild the marketing activities for address communications with buyers, analyze their behavior, perform optimization of promotion actions and budgets on them.

We also actively participate in projects which solve such problems. For example, we created a system for forecasting, both regular, and promo-sales in one of large federal networks that allowed the company to manage warehouse stocks more precisely, - Gennady Tarantasov tells.

Growth of a role of data in business processes

In retail the role of data grows in all business processes: from assortment management and involvement of buyers to logistics. Thanks to cash reform new data sources — cash vouchers and smart terminals appeared — which allow to analyze sales with deep detailing in real time.

Now analytical instruments of influence on sales in specific points not only retailers, but also producers, and even received small business. Data are used for market monitoring, management of pricing, control of existence of goods on the shelf, merchandising, a trade - marketing actions. WiFi-technologies allow to analyze audience in sales points and to interact with potential buyers using targeted advertizing, push-notifications in applications, etc. The market learns to work with big data and passes from regular reports which are under construction on "crude data", to solutions of specific business challenges, - Sergey Andriyashkin, the marketing director of Evotor IT company tells.

Yury Vostrikov, the commercial director of NORBIT company, adds that most of retailers want to obtain a maximum of information on the consumer, and use of Big Data technologies allows the retailer to receive an accurate portrait of target audience, to increase conversion and advertizing efficiency.

Distribution of new payment instruments

One more trend is a distribution in retail of new payment instruments which stimulates development of technologies, initiatives of regulators and the sales demand. The share of payment of purchases by cards in Russia, by different estimates, already makes about 40-50%. It becomes simpler to connect acquiring — in the market there were online cash desks with the built-in pinpad, and it is possible to connect acquiring remotely.

Acquiring connects most shops "at the house" and even mobile outlets. More than 70% of Evotora smart terminals accept payment by cards. At the same time the popularity of contactless payments, including the Apple Pay, Samsung Pay, etc. grows. Using contactless technologies 67% of the purchases paid with a non-cash method via smart terminals "Evotor 5i" are already made. Implementation of payment by the QR code will become one more driver of development of cashless payments, - Sergey Andriyashkin considers.

Human capital management

As Denis Seleznyov, the CEO of The First Form company notes, human capital management for retail — "new well forgotten old". The linear personnel are living people, with the requirements, the purposes and values. They create consumer value for buyers.

Time to address facing employees, to begin to collect and analyze a feedback from them — about what disturbs comes and that helps to work. For this purpose it is necessary to create corporate environment of communications where each employee will be able to prove and improve a company performance. Many employees feel entrepreneurial potential today and aim to make the contribution to development of the company. They are ready to bear responsibility for the work and for common cause if to provide them sufficient freedom of action. To use this potential, the companies need effective tools for joint work and building of business processes. In retail it is, first of all, mobile jobs of employees — not just messengers, and full multifunction applications in which there are HR services, corporate and educational portals, the check sheets for different processes, instruments of control and task management, - the expert of First Form explains.

Own IT competences of large retailers

While functional IT outsourcing is widely demanded by small and medium trade enterprises, large retail chain stores develop own IT competences more and more actively, actually cultivating in the structure home service companies and becoming a part of IT market, Sergey Kosetsky, the commercial director tells X-Com. According to him, this trend will not lose relevance in the next years.

Other trends

Distinctive feature of the company retailer — need constantly and quickly to adapt under any changes. According to Alina Smolkova, the development manager retail in the Service center "Jet Infosystems", modern intelligent systems of monitoring using which it is possible to control in real time a status of business indicators (turnover, conversion, an average bill) and technical metrics of a status of critical IT systems can monitor changes and also to understand dependence between them. Smart monitors can be useful to IT departments to end-to-end control of availability and performance of critical information systems, she notes.

Andrey Yankin, the director of Information Security Center of Jet Infosystems company, observes steady growth of interest of retail in information security.

From basic protection retailers gradually pass to advanced protection against the directed attacks, protection of business processes and an antifraud. We believe that this trend did not sputter out yet and will remain in the next years, - the expert says.

Sergey Kosetsky, refers application of the systems of intellectual video surveillance which help not only to solve a problem of thefts, so relevant for retail chain stores, to trends, without expanding at the same time staff of security guards, but also to optimize a technique of placement of goods on shelves depending on different factors and also to carry out marketing actions.

One more trend, according to him, consists in reorientation of retailers from a retail store equipment of eminent western brands for much more available products of the Russian and Chinese producers. Similar approach practices also concerning supplies: printers which check tapes, etc., costs were not paid close attention until recently.

Sergey Andriyashkin carries additional types of business which develop shops thanks to development of technologies to trends of the market. It is, in particular, payment acceptance, sale of goods by installments, work as pickup location of Internet orders. Moreover, shops already become bank agents and begin to issue to buyers cash at the checkout if you pay with the bank card.

Gennady Tarantasov from Corus Consulting notices demand from retailers for solutions for category management and pricing.

These are difficult solutions which integrate data from the different systems, allowing to manage types of goods, price fixation and plano-grams. Due to implementation of such solutions it is possible to increase revenue by 5-10% a year, - he notes.

Alexander Zarzhetsky, the head of directorate of implementation of integration projects 1C-Rarus, pays attention such IT trends of retail as development of modern means of retail marketing and implementation of the progressive technologies directed to decrease in different costs of the company. It carries the Digital Signage systems which basic purpose consists in increase in efficiency of promotion companies and informing buyers to the first solutions. To the second - programs of demand forecasting and calculation of optimal trade stocks and also automation systems of commodity logistics: the automated choice of suppliers, optimization of delivery routes, etc.

Maxim Melsitov refers growth of interest in electronic document management systems to trends of the market:

Until recently most retail chain stores digitized only the relations with external partners, and internal processes continued to conduct on paper. Now at once several ours the customer ECM implement at themselves. This trend will develop in the next several years, including, because of transition of the retail companies to the Fair Sign system. E-document flow will be used including for creation of universal transfer documents which are a part of an ecosystem of traceability.

Modern information technology development will allow to change strongly in the near future many processes in retail trade.

As Alexander Zarzhetsky, the head of directorate of implementation of integration projects notes 1C-Rarus, availability of the automated face recognition already in fast time will affect traditional loyalty systems. Usual plastic cards of participants of programs will become unnecessary: the modern systems will be able to identify any buyer irrespective of whether he filled out the registration questionnaire or not.

I think that in 2-3 years individual offers to each buyer will become obligatory attribute of retail, - the expert believes.

Big perspectives are promised by implementation of the systems based on neuronets and machine learning. Many trading companies conduct experiments in this area, carry out "pilot projects".

It is sure that in the nearest future we are waited by universal use of artificial intelligence in trade: demand forecasting, formation of the range, effective pricing – computers will carry out all these tasks much quicker and more effectively, than the most experienced specialists, - Alexander Zarzhetsky considers.

Yury Vostrikov, the commercial director of NORBIT company (enters into the Lanit group), adds that using AI it is possible to do forecasts of level of future sales, considering tens of factors, including recurrence, seasonality, growth and drop in sales.

Respectively, retailers can optimum calculate goods quantity in a warehouse, avoiding situations of out of stock. Besides, systems based on AI allow to keep the analysis of sales and to point to a difference between real forecasts and indicators of marketing, - Yury Vostrikov adds.

One more innovation which gets into the industry it is WI-FI-tracking. Already now some companies send push-notifications with the personalized discounts to the clients while those pass by their shop in shopping center. Also this solution can be used for assessment of passability of a point and collecting of analytics on the buyers who visited shop.

Maxim Melsitov, the deputy manager of department of business solutions of Softline Group, considers that in the remote perspective quite good chances of popularity have "shops without sellers" and electronic price labels. According to him, both technologies were already implemented within pilot projects, but did not gain mass distribution yet.

Electronic price labels give the chance to manage on a centralized basis the cost of goods which a system will calculate, proceeding from weather conditions, a goods remaining balance in a warehouse and preferences of buyers. Besides, having replaced paper price labels digital, shops will save a lot of time of sellers and warehouse workers who should check constantly information on cost regarding relevance now and also will reduce the probability of the conflicts when the price label was not managed to be replaced, and the price at the checkout does not match the price on the shelf, - Melsitov explains.

Sergey Osipov, the vice president of GMCS, expects distribution of virtual fitting rooms, mirrors of augmented reality and also use of VR in showrooms. Lamoda and Hoff has examples or plans for use of these technologies, for example.

Also it is worth expecting development of voice commerce using virtual assistants of type Alexa from Amazon or "Alice" from "Yandex".

Sergey Osipov also tells about an interesting case from the international retail - Neiman Marcus Group working in a premium and luxury segments builds based on the flagman shop in New York the innovation client platform which cornerstone mixing of digital and physical experience of buyers is. The digital directories, interactive fitting rooms allowing to order directly from a cabin the necessary size or other color, an opportunity to influence musical the playlist in shop using a special application – a small part of what is offered to buyers.

Example of an interactive mirror for Memory Mirror fitting rooms

In House of Innovation 000, flagman shop Nike, recent trends and technologies, such as BOPIS (buy online pick up in store), Scan & Go are also provided. Application of Scan & Go, according to the expert of GMCS, is relevant also for the Russian retail. In particular it concerns food-retail which uses this technology not only for optimization of operation of cash register lines, but also increase in the average check. It is also worth expecting further development of technologies of self-service (loading of the personal list of purchases, a possibility of interactive communication with buyers online, etc.).

Sergey Sapronov, the expert of AiTeco Group, the head of a project portfolio (the direction on software development), predicts that personalisation will begin to turn into gamification. The benefit of the client will depend not only on the purchases made earlier but also on that, for example, what quests he passed.

AR game "Films"

In parallel with it the retailer using IT will resolve also internal matters, for example, loyalty of employees, the organization of business processes and, of course, to learn to analyze Big Data for implementation of the whole complex of own tasks, whether it be making decision on opening of shop in this or that location or formation of an assortment matrix for each specific shop. Also implementation of the innovation products which will have to be transformed from the highly specialized directions to solutions for end-to-end business processes will increase. Retail is waited by inevitable transformation, we already see how the largest financial institutions become retailers. We wait, than retail will answer, - Sergey Sapronov notes.

Gennady Tarantasov, the head "Retail" of Corus Consulting Group, considers that large retail players will be gradually transformed to the IT companies: a few years ago this process took financial retail and led to creation of such powerful structures as SberTech and others.

In leading companies of retail hundreds of IT employees work, in fact, in them the direction of internal outsourcing forms. It will become the powerful engine for implementation of innovations, and at the same time will cause redistribution of IT expenses between internal and external partners in automation, - the expert of Corus Consulting believes.

Pavel Zaglumin, the head on Business Systems Development of Jet Infosystems company, selects six directions of development of the retail companies connected with IT:

• Transition from a talk about omnichannel to implementation of omni-approach in processes of customer interaction.
• Integration of flows of client data with their further accumulation in different storages for the analysis and the subsequent use.
• Upgrades of loyalty systems and approach to customer interaction using methods of machine learning.
• Creation of digital doubles of physical entities and processes (for example, warehouse systems or supply chains).
• Penetrations of machine learning into all processes, for example, in optimization of logistics chains for economy of fuel, a resource of transport and FOT.
• Implementation of the systems of seamless integration, for example, sheaves "WMS – SCE – ERP – CRM – a marketplace".

Besides, according to him, the trend which already took the industry and a telecom can get into retail. It is connected with identification of "internal innovators", i.e. the divisions which are engaged in promotion and check of hypotheses on optimization of these or those business processes and also approbation and identification of potential from disruptive technologies. The format, according to him, can be a miscellaneous — an internal accelerator or cooperation with already famous partner, attraction of an external konsalter or development of own examination.

According to base of projects TAdviser, as of October, 2019, the greatest number of projects in retail is connected with implementation of ERP systems – 1474 projects. Among them the most demanded solutions at the trading companies are products of the line "1C: Enterprise" (397 projects in retail) and also Microsoft Dynamics AX and Microsoft Dynamics NAV – on 140 projects.

1120 projects in TAdviser base are ranked as implementations of automation systems of trade. Among such solutions in leaders there are also products 1C – "1C: Trade Management" (268 projects) and 1C: Retail (161 projects). Among solutions of other developers it is selected GESTORI Pro – 116 projects in TAdviser base.

In category#ttop of the accounting systems the greatest number of projects belongs to implementation of "1C: Accounting". In TAdviser base there are 273 such projects in retail.

Among customer relationship management systems (CRM) in leaders two solutions are Bpm'online (100 projects) and 1C: CRM (93).

The serious share of projects in retail is made by implementing solutions for management of a warehouse (WMS). Such projects in TAdviser base there are over 600. Most often they are executed using the product GESTORI Pro which is already mentioned above (a system can manage business processes of warehouses and distribution centers). Among other popular solutions of this category it should be noted "1C: WMS Logistics. Warehouse Management", Forecast NOW, Solvo.WMS, EME.WMS, etc.

It is possible to study statistics of other technologies and classes of systems used in retail according to the link.

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Other materials about technologies in trade enterprises are available here.