Not that they are Luddites; it's just that they regarded retail technology as a major expense, especially in human capital. They often were cautious, even skeptical, about the promises of new technology being pitched to them.
When the pandemics arrived, many retailers responded rapidly and smartly. In scramble mode, some crammed five years of technology adoption into five months!
Now, as the lockdown restrictions recede, the conventional wisdom eagerly suggests that consumers of all ages will continue to rely on online shopping and other technology.
Hmm. Let's consider that "conventional wisdom" a bit more closely.
- "Americans spend about two-thirds of their TV time watching conventional television and just 6 percent streaming Netflix."
- "Online shopping accounts for less than 14 percent of all the stuff that Americans buy."
- "In the US, just 6 percent of Americans order from the most popular restaurant delivery company."
- "And Peloton, the maker of $2,500 exercise bicycles for streaming fitness classes, has about 2.1 million customers paying to use its exercise bicycles or treadmills. For comparison, about 3.5 million households in the United States had birds as pets during a recent year. Peloton might be less popular than parakeets, but it gets far more attention."
Now, consider this almost throw-away comment by Rose Jia, Amazon's head of growth marketing, speaking at the NRF Retail Converge.**
- “It means that we're going to have to spend a lot more time and effort educating customers” on the value of online grocery shopping, Jia said.
Might that mean that it's the customers who are the "technology laggards?!" Maybe independent retailers were simply listening to their customers.
Granted, the customers are seldom out on the leading edge. Like Henry Ford's comment: no customers were asking for a car; what they wanted was a faster horse.
As we wait for the post-pandemic dust to settle, those who keep listening to the customer – rather than trying to "educate" them – will likely be far better served.
Meanwhile, now more than ever:
- Retailers should be able to do an Open-to-Buy with a pencil before they turn over their inventory control to the promise of a technology system.
- Retailers should not go into debt to purchase very expensive technology without seeing what that debt will do to their debt-to-worth ratio. The Balance Sheet has to balance!
- To expect a POS system to control your inventory (the common pitch) is like expecting your bathroom scale to control your weight.
Exciting times continue.
* Shira Ovide, The Big Impact of Small Changes, On Tech newsletter, New York Times, June 22, 2021
** Retail Brew, June 24, 2021.