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Stay connected to see pandemic recovery solutions for retail supply chain
The path to digital transformation is much easier when you have a trusted guide—one who not only understands the challenges of the retail industry but also appreciates the unique character of your business.
Learn how you can chart your journey in this interview between technology power couple Sarah-Jayne and Dean Gratton, and experts from CDW, a leading multi-brand provider of digital transformation solutions for the retail industry and beyond. You’ll discover how to make a business case for digital transformation, and why Internet of Things (IoT) technology is critical as you use a building-block approach to speed deployment and cut costs.
(To listen to the full interview, check out our podcast Retail Tech Chat Episode 4. For more on this topic, read the article Why Retailers Should Embrace Digital Transformation.)
The Evolving Role of Retail Tech
Sarah-Jayne Gratton: What does CDW do, and what’s your role there?
Jane Liston: We’re a global organization, a value-added reseller with an 18-billion-pound turnover. What we do is work with our clients around end-to-end solutions, covering hardware, software services, and cloud. That’s us in a nutshell. My role is to lead our retail strategy, so I’m responsible for our go-to-market, building out our retail practice, and how we remain as credible as possible and support our retail customers.
Dean Gratton: Matt, what about you? What do you do?
Matt Browne: I’m a solution specialist at CDW. I tend to focus on digital transformation and innovation and just making sure our customers are getting the right solution, and that it’s going to deliver on their business needs.
Background for me is software development as a standard. I did a master’s degree in artificial intelligence, as well. From there, I moved forward into the innovation space with CDW, helping to pilot that within the business and bring those sorts of solutions in. We’ve covered everything from RFID to computer vision, to hybrid cloud and anything beyond that we’ve had a hand in.
Sarah-Jayne: What role do you see AI playing in the future of retail?
Matt: I think it plays a key role in certain elements. I don’t for one minute see a holographic AI welcoming me into a store anytime soon, as per iRobot or some other sci-fi publication. But I do see AI providing a huge amount of resource to companies who want to leverage the intelligence they can get from either data generated by the store, or data generated by endpoints on video and audio within the store to actually improve upon customer experience, rather than sit there in the front of the store doing nothing more than telling me I’ll have nice glasses on or a nice hat, for example.
Jane: I think the challenge sometimes is at the moment where people have got stretch budgets, where do you invest? And where’s going to give the biggest return? Some of these give amazing in-store experiences. You can see how it’d be great for retailers. But is it something that they can get the business case to stack up on? It’s the same with the safety solutions in store.
We did a lot of work around that, where we’ve got quite a good portfolio of social distancing solutions using visual and different technology to do that. But it’s a big investment, and at the moment do retailers need to be spending in that area? So it’s a real challenge for them, how they manage this and where they use budgets at the moment.
Dean: What is the approach to technology in the retail environment currently?
Matt: It starts with actually defining the business and functional requirements of what the technology needs to do. I think gone are the days of technology for technology’s sake. It’s about defining what is the problem. Is it too much theft? Do you want to rationalize the supply chain? Is it customer engagement? Whatever it might be.
That opens up all the relevant doors to technology into retail, whether it’s computer vision, RFID, Bluetooth, or it could be as simple as just improving a network in a store. That’s all a technology investment for a retailer. And it’s actually about what does the business require, because we’ve all seen pretty shiny things that we want to put in place, we’ve all got gadgets coming out of our ears.
I’m sure it’s that ROI for customers. So it’s building that definable ROI initially on requirements and then opening the doors to tech from there.
Dean: How do you work with Intel® to help retailers with their journey?
Matt: I think the way we work with Intel to try to bring technology into retail is we leveraged them on a couple of planes. I think the first one is that they have an immense amount of power and reach globally from both a business perspective and a technology perspective. I think the leadership that they can bring is invaluable to any organization.
It doesn’t matter how big you are, whether you’re five guys in a garage, or 10,000 people in Canary Wharf—the value that those guys can bring. And then I think also their research and development that they put into technology and testing technology, and being able to showcase that without having ourselves having to do as much research. We still need to research the technology.
Dean: Having worked in R&D myself, it’s really valuable when a customer can actually touch something and hold something in their hands. Where they actually see something working right in front of them.
Jane: I think what’s become even more important, too, is over the past six months when life’s changed immeasurably for all of us, and we’re working in a much more disconnected way where we’re not going to big trade shows, getting together at workshops and customer events, that ability to connect and still get a global view.
So where we work with Intel and CDW, we’ve got a lot of global clients sometimes being able to share that insight of what’s been happening in the Far East, what are the emerging trends to help share that information with our UK-based retailers, and to help guide them and provide those insights that people just aren’t getting at the moment.
Helping keep our customers connected with the wider picture and supporting them at the moment with insight, I think that’s really powerful.
Sarah-Jayne: How can you help a given merchant and find a solution that works for them?
Jane: It’s fantastic if a client wants to make an investment in magic mirrors in-store or a great in-store experience. But if the network’s not powerful enough to support that, and all of a sudden you’re having issues with taking payments, it’s more likely that that innovation project is going to fail. So it’s getting the right solution partner, but also making sure the client’s got the right foundation to make their projects a success.
Sarah-Jayne: You’ve looked for end-to-end solutions that are deployment ready so they can really hit the ground running.
Jane: Absolutely. That’s what CDW brings to the table. I talk a lot about data center to store, about how you make that end-to-end solution work. So rather than having to work with lots of different organizations, we’re able to simplify and take the complexity out of that journey.
Sarah-Jayne: But this is not one-size-fits-all, is it, in terms of your solutions? They are adaptable, in terms of the varied needs. I read or I heard somewhere the other day, you can’t solve retailers’ needs by generic solutions. They need to be more bespoke.
Matt: Exactly. And that’s the type of approach we want to take. There’s one thing for having a repeatable deliverable solution. And there’s one thing for having a custom solution for every customer.
Every retailer is different. Every business is different. And we look to take a building-block approach where we can build a solid foundation, a solid base. Then, as the individuality of each brand comes out, we can assess the right prepackaged building blocks to build their brand.
There’s 25% of pure custom branded work for that organization, whether it’s the right colors, the right look and feel for their customer, whatever that might be, so that it is a unique solution for them. But 75% of the work is built in this building-block fashion that we can then repeat, deliver, and ensure that we can support them on the journey once the technology is in there as well.
It’s one thing to sell something to somebody. It’s another thing to make sure that they’re deriving the value, and that we can make sure that that’s going to help the business continue to thrive once the technology’s implemented.
Rapid Deployment of Proven Tech
Dean: What are the Intel® Market Ready Solutions, and how do they address these issues?
Matt: I think the Market Ready Solutions from Intel address a number of issues. I think the first one they address, which I think is beneficial to everybody, is they do the research, the testing for brands. Once upon a time, a brand would come in, and they’d want a smart mirror or a mobile pulse system, and they’d have to go out to four or five different people, get different versions, bring them into store, test them. That’s a lengthy process. It takes time. They have to do all the back-end work to deliver that.
What the Intel Market Ready Solutions do is they take all that work, and Intel does that research and that preparation and can provide a blueprint to succeed for the customer. So I want a magic mirror, here’s a magic mirror, and here’s how you deliver it. Here’s the technology that’s required. And here’s the requirements on the back-end, and here’s everything you’re going to need as a business to deliver that. I think that’s what they did really well, they have such a broad range.
So many partners feed into that range that we’ve got solutions in there. Other partners have got solutions in there, and it allows us to take the people that are doing the right things really well and accelerate them to market—and also not go down the unfortunate two-guys-in-a-garage route where they can promise the world, and it’s all there in blueprint, but it’s not been delivered in a real-world scenario.
Dean: Just one thing really quickly, what is a magic mirror?
Matt: A magic mirror is a mirror that allows you to try on clothes and interact with the store in the changing room. It has video detection, so it can impose clothing on top of you, or makeup on top of your haircuts or glasses, whatever it might be.
But also it can be touchscreen, to allow you to request the next size up, or the next size down, or a different color, or something like that. I like to call it that “what other people purchased” experience, but in a store rather than on a webpage.
Sarah-Jayne: Would you describe that as augmented reality?
Matt: In a sense, some of them are augmented reality. Some of them not. There’s a scale, but we’ve seen a lot of interest in augmented reality for things like makeup and glasses, especially at the minute, without being able to go into store to try on a new pair of glasses or try a new eyeshadow color.
Brands are looking for ways of using augmented reality to bring that either into a store, but not having to have contact with anyone or into a device, so that they can retain the customer experience for a customer: whether they’re sat in their living room or sat in traffic on the M25, they can still get to that experience.
Jane: We also speak a lot to retailers about the importance of understanding their inventory. Especially from a customer experience of “Right, that’s in the store, I’m going to there to collect it. Oh no, it’s not.” Brands don’t want that. This is where we’re seeing a lot of interest around RFID solutions, so that you can accurately manage what stocks are, so that you’ve got that confidence.
Retailers really want people to go into bricks and mortar, so they’ve got to make sure stock’s available. It helps with the whole click-and-collect piece as well, and making sure they’ve got the right level of inventory. From an operational cost perspective, you want to have the things in stock that people are buying, and not 200 pairs of the wrong jeans that aren’t popular.
Sarah-Jayne: Also, these days people tend to go out with purpose. They go out, they need to get this, they need to come back. It’s not the strolling around environment that we had before. It’s never been more frustrating than to get to somewhere and find that something you thought was going to be there isn’t there.
Jane: And I think it links a lot into where we’re seeing more retailers looking at ship-from-store, in addition to distribution centers. They know what’s in there. So when potentially an online order is placed, they’ve got the ability to ship from different locations. And often we’re seeing more demand as well from consumers.
We’ve all got a bit used to Amazon Prime and next-day deliveries. We expect that standard now, and we’re seeing that enhancement now of four-hour delivery windows. And the only way to do that is to ship from store locations.
Leveraging the Internet of Things
Dean: Do you use the Internet of Things to support that ecosystem?
Matt: Absolutely. I think that technology is more and more important. Going back to the idea of a building-block approach, having a stable platform for that technology to feed into is core to the business relying on that platform. They can say in your four-hour delivery window, “We can have that to you in four hours” and they know they can get it to the shop in two hours. And then it’s two hours from the shop to me, for example. And that’s a huge benefit to retailers being able to provide that clarity and level of information as they try to cope with whatever wave of lockdown or process needs to be in place as we move forward.
Dean: Do you see the Internet of Things adding any other value in the retail experience?
Matt: I think so. It adds value to a retailer in terms of supply chain shipments, knowing where things are, having access to information. I think it can provide huge benefit to customers as well. I know I like it when I can see a time window for delivery, for example, or I can interact with the technology within a store, from a device, something like that. And they’re all connected things in this Internet of Things to give it a broad term.
I think it’s hugely important because, one, it increases that experience in store, which obviously makes me want to go back to that store. However, when you’re then delivering data back into the business, it makes a business able to be more profitable. It allows the business to have that conversation and then move forward. So it works really well both sides of the coin.
Dean: One important aspect of the Internet of Things is the new wealth of data that’s available, and the opportunity to have this information about retailers, and the experience backed up with data. You could actually model new experiences and issues within that ecosystem because of that new data. How do you use data? How does CDW use data?
Matt: We use it for all manner of things. We use a lot of data to identify what’s working and not working for our customers where we’re seeing trends. Where Jane is out there talking to customers and getting information from them, there’s always data being captured there, and we’re able to use that to look for trends. Where should we be focusing as an organization? We have our opinion on where we should be focusing, but the industry might be going in a completely different direction, right? So it’s always good to have that data.
Dean: Only if it’s used right. I’ve worked with a lot of companies that have this enormous amount of data, and they scratch their heads. They just don’t know what to do with it.
Case Studies in Innovation
Sarah-Jayne: Can you guys give us some examples of merchants you’re working with? How are they using your technology in innovative ways?
Matt: On the data side of things, we’re working with a global cosmetics brand which, unfortunately, I cannot name. But they are doing exactly that around their supply chain. They need to know where stock is, where it’s going, how long it’s sat in a store for, how they can reduce their inventory, and how they can ship that from the store.
We have some incredibly interesting statistics from them around holding almost nine months’ worth of stock in a store based on their sale volume for that product. They just continued to order the same amount every month, because that’s all they knew. They didn’t have an accurate view on inventory. So they’re able to start actually bringing in the stock they need, rather than having boxes and boxes of stock taking up corridors.
That then enables them to have that right place, right time stock, and not be sitting on product, which then enables them to rationalize supply chain.
But then beyond that, rationalize their manufacturing process. They’re not thinking that they’re selling 500 of this shade of lipstick globally. They actually are selling 100 and people have just been over-ordering, because they thought that’s what they needed. So then the manufacturing processes is able to look at where they need to refocus their efforts and deliver value that way.
Jane: And I think it links as well into some of the loss piece as well, because obviously these are small items of high value. And you hear some very high percentage in loss rates where they haven’t been able to track the inventory in the way that they can do using this solution. So the savings are massive, and there’s been estimates that the project could potentially pay for itself within nine or 10 months, despite the scale of it, in what the savings can be.
The Value of Relationships
Sarah-Jayne: What do you think differentiates CDW from others in the marketplace, and what are your core values?
Jane: I think there’s a couple things that stand us apart. First, we supply to over 150 countries. We’ve got an amazing logistics and supply chain business, and that’s such a core element for retailers. Getting new kit to store is such a headache, especially with different currencies and different challenges and the cultural differences. That’s the massive value of what we can do with simplifying that.
For us, it’s about partnerships as well: really understanding our customers, their brand, their business challenges. Because they’ve not just got the world of bricks and mortar. They’ve got corporate, they’ve got e-commerce, they’ve got such a complex landscape, and they’re being pressed very hard on operational costs.
And if we can help fast-track some of the innovation conversations by our knowledge, working with Intel on the Market Ready Solutions, and then harnessing CDW core skills around infrastructure and data centers, package up a complete solution—I think that’s really powerful, too.
It’s about the relationship, understanding the business, and at the moment, also being there for people. It’s tough times, and we’re all people at the end of the day.
Dean: How did you begin your journey with Intel?
Matt: My journey with Intel began about four years ago, and it came at an interesting time. CDW had just finished purchasing Kelway, and we were coming into the fold as part of the CDW family. At that time we were spinning up a shadow digital transformation team within the organization. It just so happened at that time that Intel was putting more attention into Kelway or CDW UK.
It was a match made in heaven, because the guys from Intel really wanted to do some interesting work with us. We really wanted to get into some interesting work. And so we just were drawn together through that process. It started slowly and over time we’ve just built that partnership up. It’s been a fantastic relationship.