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Retail transformation being held back by outdated infrastructure

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The limitations of legacy infrastructure are forcing retailers to reconsider their plans for in-store tech. According to a study commissioned by retail software provider Zynstra, 98 percent of retailers would use more new tech if deployment was simpler.

Old tech holding back transformation

20 percent of the 308 U.S. and U.K. retail tech decision makers surveyed said they’ve had to postpone or cancel the launch of new in-store tech as a result of infrastructure limitations. Technologies such as augmented reality are set to transform the retail space but are currently being restricted by the constraints of their predecessors.

Retailers are looking to new IT as a way of improving efficiency, offering a modern customer experience and enabling new innovation. As Retail Dive reports, Zynstra found most decision makers have “low confidence” that their tech stack can achieve these aims. This is creating pressure across the industry as retailers find themselves unable to implement their in-store tech visions.

Challenges to retail innovation

The survey found several specific challenges impede the deployment of new applications. Budgetary restrictions account for most of the delays, with 48 percent of respondents finding digital transformation costs higher than expected. Difficulty in finding skilled IT experts is the next biggest problem, with 35 percent of retailers struggling to find the talent needed to maintain in-store IT.

In addition to these problems, retailers are still yet to embrace distributed models for their core IT infrastructure. This makes it hard to manage and deploy the technologies that are used in their business. Almost half (49 percent) of respondents surveyed said they cannot easily make IT changes across all their branches, with 32 percent treating individual stores as their own IT installations. The lack of flexibility makes the introduction of new tech a significant challenge.

“It is clear that IT decision makers in the retail space are going the extra mile to support customer experience improvement initiatives and respond to seasonal demands, despite facing significant challenges. But best efforts and squeezing the last drops of performance out of existing infrastructure is no longer enough,” said Zynstra CEO Nick East. “With the customer experience, and particularly the in-store customer experience, fast becoming the key competitive differentiator, it is clear that retailers need a more effective way for IT to support improvement initiatives.”

Cross-industry issues

The roadblocks encountered by retailers during digital transformation will be familiar to businesses across most industries. Recent studies have repeatedly found enterprises are struggling to implement their digital strategies, with most being impacted by one or several common stumbling points.

The digital skills shortage, industry competition and restrictive legacy tech are the most regularly cited concerns of transforming businesses, so enterprises should more carefully plan and research new technologies before beginning implementation. Even strategies that look good on paper can fail if there isn’t a coherent structure that defines how they will be developed, deployed and maintained for long-term use.

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Amazon rival Rakuten buys mobile ordering and pickup startup Curbside

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Rival to Amazon and Japanese retail giant Rakuten has acquired Silicon Valley mobile ordering and pickup startup Curbside. Details of the all-cash deal were not disclosed, but the acquisition could be a boon for the Japanese e-commerce company.

Mobile solutions for brick and mortar businesses

Founded in 2013 by former Apple engineers Jaron Waldman and Denis Laprise, Curbside has a suite of features that deal with all aspects of mobile commerce for restaurants and brick and mortar retail stores. Their most popular feature, ARRIVE, tracks customer’s journeys to predict when they’ll be approaching and arriving to have the product ready in an instant.
In its suite, Curbside’s offers programs that build online storesfill online orders in-store and grow store traffic.

According to Tech Crunch, the terms of the “all-cash” deal were not released. Curbside has previously raised between USD$40 and $50 million from investors like CVS, Index Ventures, Sutter Hull Ventures, AME Cloud Ventures, Qualcomm Ventures and Chicago Ventures

According to the Silicon Valley Business Journal, Curbside was valued at more than USD$100 million in 2015 during its last venture round.

Part of the family

In the press release from Curbside, co-founder and CEO Jaron Waldman writes, “For our customers and partners the headline is that nothing will change. Curbside will operate independently as a Rakuten-owned company with our team, services, partners and product offerings all remaining intact.”

Yaz Iida, President of Rakuten USA, Inc said in a press release “Welcoming Curbside to the Rakuten family is all about the consumer, and we are excited to be able to empower consumers with even more ways to enjoy shopping.”

Mario Pinho, CFO of Rakuten, welcomed Curbside “to the Rakuten family” on LinkedIn.

Earlier this year, Rakuten announced that it’s building a customer loyalty program based on blockchain technology, and building its own cryptocurrency, Rakuten Coin.

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How brick and mortar grocers benefit from digital transformation

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Brick and mortar grocery retailers have the potential to adopt artificial intelligence to help with stocking their stores, pricing their products and being competitive with online retailers like Amazon.

Michael Feindt, the founder of AI firm Blue Yonder that specializes in helping retailers adopt AI to change how they carry out their core processes, wrote an article in Silicon Republic about how grocery chains can use AI to operate smarter.

With online grocers rapidly adopting AI, Feindt writes that it’s important for brick and mortar retailers to “move beyond their legacy infrastructure and adopt the technologies of digital transformation.” These technologies include AI and machine learning.

To stay competitive in a market that’s increasingly focused on consumer satisfaction, Feindt writes that adopting AI can help grocery chains stock their stores more efficiently in an effort to reduce waste and ensure customers get what they want, as well as price their products according to real-time data on deals and promotions offered by other stores.

Feindt writes that stock and pricing in brick and mortar stores — two traditionally human-led domains — need to start using the data they have, and use AI to help process that data.

Paul Clarke, the CTO at Ocado (the company behind the grocery robots shown earlier) told The Telegraph that AI is “critical” to the industry, and where it’s heading.

“From our point of view artificial intelligence is the one to rule them all when it comes to the set of disruptive technologies that power our business and we already make extensive use of machine learning across our platform,” said Clarke. “But really we just think we’re getting started.”

It’s also easier than ever before for grocery chains to go beyond self-service checkouts and start using AI to optimize business, below is an infographic detailing 65 tech startups that use artificial intelligence, virtual reality… etc to usher grocery store operations into the future. This list is packed, but it’s not exhaustive.

From using AI to combat food contamination to giving allergy-sufferers peace of mind when shopping to programming shopping carts to follow consumers around the store, there are endless ways that AI can enhance grocery operations and produce tangible results.

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Culture

Mozilla announces grants for projects on how AI affects society

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Mozilla recently announced the creation of seven new five-figure grants for “technologists and media makers who help the public understand how threats to a healthy internet affect their everyday lives.”

Under their “Creative Media” awards track, Mozilla is offering a total of $250,000 in awards comprised of two $50,000 awards ($47,500 award + $2,500 MozFest travel stipend) and five $25,000 total prize packages ($22,500 award + $2,500 MozFest travel stipend). Mozilla says they’re specifically looking for projects that focus on AI and machine learning.

Mozilla wants these grants to go to researchers who can help the public to better understand how threats to a “healthy internet” are impacting their lives. These projects can be presented in a variety of mediums such as videos, games, browser extensions and data visualizations.

To be eligible for this award, projects must already be in-progress, at either the conceptual or prototype stage. They also have to be “freely available on the web,” have the ability “to be broadly shared,” and must include “privacy-respecting mechanisms.”

This isn’t Mozilla’s only project that has the aims of teaching people more about the changing face of technology.

From briefs to explainers to graphics, Mozilla has been attempting to make it easier for people to understand how things work.

Applications for this grant are open now and close on August 1.

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