Nutanix, an enterprise cloud provider, has announced the retail industry findings of its second Enterprise Cloud Index Report. The report measures retailers’ plans for adopting private, hybrid and public clouds. It found the vast majority of retailers (87.5%) identified hybrid cloud as the ideal IT operating model. It also showed many retailers (72%) are planning to move some public cloud applications back on-premises.
Retailers recognise that seamless customer experience is no longer a “nice-to-have.” It is a critical factor in winning new customers and retaining existing ones. In addition, flexible cloud infrastructure is critical to delivering it. A recent IDC report noted worldwide spending on customer experience technologies will reach $641 billion in 2022. IDC suggest this demonstrates it’s at the forefront of business leaders’ strategy. In line with broader IT industry trends, many retailers also recognise the full, long-term costs of the public cloud.
Additional findings of this year’s report include:
Retailers focus most on agility
Retailers ranked the ability to accelerate IT deployments (54.3%) as the top factor in deciding the best cloud environment for each application. In order to adapt quickly to customer trends in an age of multichannel selling across many platforms, retailers are leading the pack in maximising the flexibility of IT infrastructure to keep pace.
Security is top of mind
Data showed that security heavily shapes retail cloud deployment plans. Nearly two-thirds of respondents (63.6%) said security has significant influence on their future cloud deployments. Hybrid cloud specifically identified as the most secure (32%). Data privacy regulations continue to tighten and expand across the globe. As a result, retailers are at the forefront of looking for ways to efficiently manage customer data securely. Hybrid cloud operating models offer the security and flexibility retailers need to stay ahead of policy changes.
Retail leads in digital apps and IoT cloud deployments
Traditionally, retailers always innovating to keep pace with customers’ demands. The sector outpace averages in using the public cloud to run digital applications and Internet of Things (IoT) applications. They also run their business applications more often in the public cloud than other industries. According to the report, 11% current penetration of multiple public clouds and about 19% penetration of a single public cloud.
“Staying relevant to today’s customers means having the necessary cloud infrastructure in place to embrace omnichannel retail experiences,” said Greg Smith, VP of Product Marketing, Nutanix.
“Retailers use data to connect the eCommerce and in-store shopping experiences. The only way they can do this accurately and efficiently is through flexible, scalable technology. The rise of selling on social media platforms also means integrating payment into the user experience. This brings security and protection of customers’ data to the forefront of retailers’ minds. Hybrid cloud provides the portability and control needed to bring retailers into the new era of customer experience.”
The 2019 respondent base spanned multiple industries, business sizes, and the following geographies: the Americas; Europe, the Middle East, and Africa (EMEA); and the Asia-Pacific (APJ) region.
Enterprise Times: What this means for business?
Increasingly, businesses are planning to aggressively shift investment to hybrid cloud architectures. However, many short-term cloud deployment plans have hit a significant speed bump during the past year. Nearly three-fourths of 2019 respondents reported that they’re moving some number of applications from the public cloud back on premises. Correspondingly, the use of traditional, non-cloud-enabled datacentres actually increased slightly instead of dropping by more than 20%, as expected.
Unlike in the broader IT industry, where cost is often the top consideration for business, this report highlights the different attitude of retailers. It shows that retailers prefer hybrid cloud architectures to deliver flexibility and security. Retail, is ultimately about customer engagement. To engage with customers means being able to respond to their requirements quickly and effectively. Hence the reason why retail is embracing hybrid cloud solutions.