CHICAGO -- Executive information systems rank first among the "hottest technologies" supermarket retailers will pursue in the next 18 to 36 months, according to a new survey.
Retailers' focus on the consumer has intensified the need for better decision-support systems to more effectively respond to changing market conditions. To that end, chains are increasingly turning to EIS and cite it as the most important technology they will be implementing in the next three years.
That finding was among several trends highlighted in the Fifth-Annual Retail Technology Study, which was conducted by the Consulting & Systems Integration division of Computer Sciences Corp., Waltham, Mass., and based on responses from 323 retail information systems executives across 13 classes of trade, including discount store chains.
Supermarkets represented 12% of total respondents, the third-largest retail segment surveyed, led by nonapparel specialty, 27%, and apparel, 15% of respondents. The survey was released here at the Retail Systems '95 conference late last month.
"Grocers are among the leaders in terms of retailers planning [to build] consumer-specific data bases in the near future," the report states. "Executive information systems bring clarity to the information in this transaction-driven industry, allowing for better decision-making and speedier reaction to market conditions."
The importance supermarket retailers put on store operations, which they cite as the most critical business function, is reflected in their store-level technology investments as compared to other
retail industries.
For example, 80% of supermarket respondents indicated they were using radio frequency devices in the store vs. a 29% average across all retail segments; 65% of grocery retailers reported using traditional point-of-sale terminals compared with 55% of other retailers; and 93% of supermarkets cited use of scanners compared with 67% of the general retail population.
While supermarkets may be concentrating on store-level technologies, they have not made logistics a priority, the report said.
"Physical distribution efficiency at this point in time is still not a primary concern of grocery retailers," said Mike Klaus, principal at CSC.
Asked to rank technology applications, supermarket retailers put frequent-shopper programs at the top of the list in 1995, edging out inventory management which ranked first in 1994.
"Grocery retailers, perhaps more than any others, realize how fragile the relationship with the consumer is," Klaus said. "As a result, they are aggressively looking for programs that make the individual consumer feel special instead of relying the old mass-marketing programs focused on no one in particular."
Another key survey finding is the increasing emphasis supermarket retailers are putting on information technology to support future growth.
In 1995, 55% of retailers said the primary purpose of IT investments is to support anticipated growth, a dramatic increase over 1994, when only 34% of respondents characterized the role of IT in that manner.
The survey concluded that supermarket retailers are developing their technology plans in response to three key external factors: the consumer's quest for value, shopper infidelity and competition from supercenters and other alternate channels.
The Fifth-Annual Retail Technology Survey is a joint project of CSC and Retail Information Systems News, Randolph, N.J.
