How vendors convince retailers to pilot their solutions
Make a strong business case for piloting a product and greenlighting its adoption.
Vendors pitch a million and one solutions, but without effectively demonstrating business value, the entire process is halted; you can't adopt what you don't pilot.
The first step is the idea and in the retail industry, ideas for launching pilots come from multiple sources, including store or field operators, customers, and technical or marketing partners.
For better customer insights, product managers visit stores and what comes from those visits is "pretty low-fi," said Laura Nawrocki, senior director of digital strategy and innovation at Guess?, Inc., while speaking at the National Retail Federation's (NRF) Big Show in January.
Once the ideas and pitches are done, nontechnical leadership can step in and stymie new tools unless the pitch is tied directly to greater business value. This is where the burden meets the road for vendors and CIOs.
But, that burden isn't insurmountable.
What companies want
Solution providers relentlessly reach out to potential customers with ideas, but agreeing to every pitch, let alone hearing every pilot, is an impossible task for companies.
Vendors pitch everyday, but the pitches that get through are from vendors with an understanding of the organization and which technologies it currently has, said Nawrocki.
A vendor must know of existing relationships a company has with them to avoid large capital or labor investments. When asked what the most effective way vendors can pitch their solutions is, Nawrocki said, "make it free," which is a common practice despite the laughs that came from the panel's audience.
But "if free is the number one factor, all sorts of business realities get in the way of that project ever going anywhere," said Walt Chantlos, national sales manager at Panasonic, in an interview with CIO Dive. "Hardware sits, meetings are missed, there's no buy-in, there's no real accountability on both sides."
Having an active partnership between vendors and customers frees up the labor needed to support the new technology while also strengthening a relationship for future investments. Nothing is "set and forget." New technologies need constant nurturing while deployed.
Another factor against free pilots: They are not always economically feasible for smaller vendors or startups. The vendors that are unable to offer free pilots need descriptions of how the tech will scale and how the company will continue support if the customer decides to adopt it, according said Scott Emmons, CTO of TheCurrent Global, during the NRF panel.
Companies expect vendor partnerships to go beyond the initial investment in the product, and some companies go as far as having guaranteed support written into their contract.
Financial considerations are often the final and most common hurdle. Innovation labs or organizations tasked with pursuing disruptive technologies have strained budgets, which makes the application of new technologies difficult to pursue without "white glove" full service, said Emmons, in an interview with CIO Dive in January.
Ideally, the "in-house team is basically oversight," said Emmons, which affords scaling and cost savings. But white glove full service introduces complexities pertaining to service levels and the understanding a vendor has of the customer's business.
What vendors can do
Companies want to use vendors that can make the case for cutting down on labor costs, improving productivity, and boosting sales through better data. The effective solutions providers are the ones able to solve a problem or, at the very least, streamline productivity.
For example, Brad Bogolea, co-founder and CEO of Simbe Robotics, "struck a real pain" in the retail industry in 2015, Bogolea said in an interview with CIO Dive in January.
Retailers stand to lose about 4% of annual revenue because of unstocked shelves, said Bogolea, and finding an innovative tool to offset that loss is a necessity. It's also a clear argument for business value because a stocked shelf is the line between "what people see and what people buy," said Bogolea.
With its flagship and "always polite" Tally robot, Simbe was able to offer retailers a product that would essentially take the labor out of aisle work. Tally can make sure shelves are stocked or items are in the right place.
As a startup in 2015, Simbe had to adjust to the retailers reaching out to test Tally, which introduced the concept of "partner qualifications" or customer qualifications, said Bogolea. The robotics company will only work with a retailer with a "trusted business owner," like a CIO, who "own budget" and are empowered to make decisions.
The trouble with new stuff
Innovation is an attractive word for companies that walk the line of a "tech company." Overzealous, disruptive technology pilots, however, can cause unnecessary headaches down the line.
Considerations for adopting new technologies are often for the long term, which makes companies or customers more willing to invest and "have some skin in the game," said Chantlos. This also means a company should spend more time with a solutions provider to map out the future.
A previous employer of Nawrocki's pursued a solutions partner for global expansion only to eventually find one major issue in their conflicting roadmaps for market expansion.
While her former employer was looking at expansion beyond China's perimeters, the solutions provider was not. "We just didn't ask the next question," said Nawrocki. "It was silly trap" to only pay attention to the immediate goal and not the long term ones.
Vendors have a responsibility to talk through the growing pains and expectations of a company, said Chantlos, and sometimes this means bringing in an aggregate of engineers and business leaders.
When approaching vendors, companies generally know the product they need, but it's up to solutions providers to map out the bigger picture. "The hardware is one piece, often procured by one group of people, but there are multiple projects running," like running multiple software applications or addressing new security concerns, said Chantlos.
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