Retailers will participate in the surge of business spending expected this year, according to new research by the NRF Foundation and BearingPoint unveiled today at the NRF Annual Convention in New York. The study, “Retail Horizons: Benchmarks for 2003, Forecast for 2004,” found that eighty-three percent of retailers expect replacing or upgrading point of sale software systems to provide real-time customer information at the time of sale.

This second annual study, which surveyed more than 100 retailers, focuses on store and field operations, supply chain, customer relationship management, merchandising, advertising, human capital, information technology and marketing issues.

In analyzing this year's survey data, NRFF and BearingPoint observed that the three currents of change of last year — moving toward greater customer-centricity, traveling along the data-knowledge-action continuum and shifting toward a boundaryless business model — were reaffirmed with the addition of a fourth current: the need for retailers to be on a greatly accelerated path to differentiate themselves from the competition.

“With continued momentum in the economy, now is the time for businesses to invest in new technology,” said NRF President and CEO Tracy Mullin. “The retailers who choose to invest today will be rewarded tomorrow.”

“As the competition increases, retailers need to figure out how they can differentiate even more,” said Scott Hardy, a managing director with BearingPoint's Retail/Wholesale practice. “Retailers are looking to POS in 2004 to provide real-time information to have a better understanding of the customer.”

Other key findings of the study include:

  • Cost containment will be the #1 priority for 2004
  • 74% of retailers segment their customer base by loyalty and
    66% by customer preferences

  • 49% cite private label development as a priority
  • 82% list sales associate training as a key initiative
  • In addition, about a third of the respondents will focus on
    micro-merchandising and multicultural marketing

The study suggests several approaches retailers can use to differentiate themselves from the competition, including:

  • Leveraging a robust understanding of the consumer to create
    unique, differentiated merchandise assortments.

  • Build a brand in an integrated way that resonates.
  • Provide a seamless, multi-channel shopping environment.
  • Build and sustain a high performance workforce.