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In Between the Numbers: Big Pipes and Lean Stores

June 24, 2011 at 9:02 am PST

 Thinking about the ICT future of the store with my colleague Bharat Popat.  Doodling at the mental whiteboard.

 Current state in the lower left.  It’s client-server architecture. Three to six servers per store, depending upon segment and store size. Fat-client POS and desktops. Fans and hard drives. Ongoing break-fix maintenance contracts.  A network pipe just big enough to each night send out batched transactions, inventory, and other performance data, and download the price-item files, promotions, and performance reports.

 Now, a line from the lower left current state all the way to the upper right future.  From the “as is” to the “will be.”  Figuring three to five years.  An assumption that a retailer will want to lead the segment and compete worldwide. 

 Hmmm.

 Grab the pen and draw the line, and as you do so, calculate the evolution of technology and of consumer expectations.  Calculate the impact of global e-commerce, of multi-channel and omni-channel, of smart phones and tablets, of social networks and social shopping.

 Calculate the impact of content clouds and IP video, of augmented reality and “mashops” of virtual into the physical. Calculate the impact of right time data analysis. Calculate dynamic video messaging.

 Calculate how to cut time-to-capability down to weeks, not years.  Calculate how to do more and spend less.

 Now multiply it all by the demographic weight of the tech-savvy Millennial generation.  

 Do the math.  Yes, I’m prejudiced -- I’m a proud Cisco guy.  But it’s the math (not the badge) that leads me to this future state: a retail store that’s a living, breathing website.

 A retail store that’s built on a lean, network-based architecture and a significant increase in network capacity to and from the store.  

 Lean store and big pipe.  

 More about these calculations in weeks ahead.

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Welcome to Cisco’s Inaugural Retail Industry Blog!

In January I was at the National Retail Federation trade show for their 100th annual convention in New York City. While at the show it struck me that the world of retailing has changed a lot in the past century – not that I’ve been around to witness ALL those changes although sometimes it does feel like it :-)

Cigar boxes   gave way to mechanical cash registers to today’s sophisticated point of sale systems.  Farm and artisan products delivered by wagons morphed to sophisticated supply chains integrating distribution centers, trucks, ships and aircraft.  Most people today associate the word “amazon”  with an online retailer rather than a river in South America.

As we look forward to the next 100 years of retailing, the industry is facing a huge transition.  Consumers are shopping on the web, on the phone, in the stores and leveraging personal technology to  do “My Shopping, My Way” -- they’re looking for a truly custom shopping experience.  Consumers are interacting with retailers not just through their purchases, but also through social media such as Twitter, Facebook, blogs etc. in real time.  They are expecting their online and offline shopping experiences to  look and feel   the same. They don’t care about channels – they demand a ubiquitous brand experience.

For retailers, these rising expectations have profound impact on their strategies in a number of areas from marketing,  to store operations,  to real estate, to employee retention,  and physical and data security.  In this retail blog, we will be exploring the impact of technology in these areas with Cisco and third party experts in a number of settings  including  industry events and online discussions as we talk about  how retailers can address this market transition.

We hope you will join us going forward and also participate in our other retail social media properties including Cisco retail on Twitter, Facebook, YouTube and Linked In.

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