In 2013, OmniChannel Retail Maturity Will Move From Foundation to Convergence and Precision to Immersion, Says IDC

Singapore and Hong Kong, December 11, 2012 – International Data Corporation (IDC) announces today that retail companies will expect continued but smoother growth in APeJ over 2013, driven by economic growth forecasts ranging from as low as 2% to over 8% across the largest countries in the region.

Economic risks potentially affecting consumer spending and employment levels in the region will mostly come from possible downturns in exports, especially towards Europe, while inflation rates in many countries remain high and continue to represent a key risk factor.

Thus, retail leaders have no other choice but drive business model transformations and focus investment decisions around the new consumer. To sustain growth going forward, businesses will be looking to leverage the third generation of IT platform in newer and smarter ways, with the objective of addressing specific industry requirements.

More insights will be revealed in a forthcoming report, “IDC Asia/Pacific (excluding Japan) Retail IT 2013 Top 10 Predictions".

"Whether the innovation path is around eCommerce, immersive fitting rooms, interactive displays, mobile or other forms of augmented experiences, the OmniChannel Orchestration & Optimization (O3) platform supports the creation of a longer term strategy that ultimately shifts the IT investment emphasis to revenue generating projects.

“The business benefits will result from synchronized, harmonized process execution, which will lead to better tuning of inventory in real time, improved stock levels, and a differentiating customer experience. That will be one experience that will drive profitable growth for APeJ retailers over the next decade," says Ivano Ortis, Head for International Research, IDC Retail Insights.

IDC expects Retail IT spending in the APEJ region to reach US$16.7 billion in 2013, which is a 4.4% growth over 2012. It further expects annual growth rates to remain around 4% or more over the next years, with a peak of above 5% by 2015.

Drawing from the latest IDC research, retail end user discussions and internal brainstorming sessions amongst IDC's regional and country analysts, the following are the top 10 IT predictions for the Retail Industry in 2013. These trends are what IDC believes will have the biggest commercial impact on the APEJ Retail IT market, with some issues extending beyond 2013.

Prediction 1 - OmniChannel retail maturity in APeJ will move towards converged foundations and immersive precision in 2013

The new archetypes of OmniChannel consumers — digitally connected and instrumented, lifestyle driven, and inspired by unique experiences with their preferred brands simultaneously across all of the available sales channels and customer touch points — require companies to transform their businesses from product-centric and services-centric to new customer experience objectives and performance management strategies.

This is no easy challenge. Achieving the market opportunity requires business model transformations aimed at capturing - and intelligently leveraging, orchestrating and efficiently executing - all of the OmniChannel moments of customer participation into the brand experience. A guide to OmniChannel maturity steps is illustrated in the forthcoming report.

Prediction 2 - OmniChannel transformations will drive platform, real-time intelligent visibility and execution excellence investments

Pivotal to achieve short and long term OmniChannel objectives will be the differentiation of the customer experience built upon:

• OmniChannel Orchestration & Optimization (O3) process and technology platform design principles. This will enable OmniChannel fulfillment, merchandising, commerce and (digital) marketing functions.

• Real-time intelligent visibility - across customers, products, services, inventory, employees, regardless of channel.

• OmniChannel Execution excellence - store and warehouse/DC workforce, order fulfillment, localized assortments planning optimized for space, allocation and replenishment.

Other predictions include:

3. Retail Big Data will be among the Top 3 investment areas in China

4. A new retail market opens up in India with FDI approval

5. APeJ retailers will invest in customer analytics, merchandising planning, and digital marketing technologies

6. Converged operations across mobile, social, ecommerce and store web based technology will be key

7. APeJ retailers' supply chain focus will shift from scale towards improving customer experience more efficiently

8. APeJ retailers will use smart supply chain technologies (e.g. software, analytics, mobile devices, sensors, RFID, social networks, cloud) to improve the economic and brand strength.

9. Vertically integrated retailers in APeJ will invest on PLM (Product Lifecycle Management) software to support geographical expansion opportunities

10. APeJ retailers will address CrowdMobility with mobile platforms, and not just with apps!

For more information about this report, “IDC Asia/Pacific (excluding Japan) Retail IT 2013 Top 10 Predictions" (forthcoming), please contact Madhura Moulik at +91 80 6699 1090 or mmoulik@idc.com.

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