It becomes imperative for retailers to understand who customers are and drive technology efficiency that streamlines operations and reduces cost. Consolidating technology portfolios and promising reliability becomes mission-critical.
For incoming technology leadership, it's a lofty goal.
Kevin Nehring joined Lucky Brand as chief technology officer in January, taking over technology leadership during a change of company governance. At the end of January, Carlos Alberini resigned as chairman and CEO, departing for retailer Guess, Inc.
In his stead, Lucky Brand established the Office of the CEO, comprised of CFO Nigel Kershaw, COO Mike Relich and Acting Chief Produce Officer Lexi Tawes. The newly-established office was tasked with managing company operations while the board searched for Alberini's successor, according to the January announcement. Matthew Kaness joined Lucky Brand as interim chairman and CEO in September, according to Lucky Brand.
Nehring reports directly to Relich, who spent 15 years as a CIO before shifting to a COO role while at Guess.
As CTO, Nehring was tasked with "really driving efficiency and becoming more revenue driven from a strategic aspect with IT aligning with business," he told CIO Dive. Strategy focused on cloud-based platforms, package application toolsets and data driven solutions.
A "capital-light" structure, from a financial aspect, Lucky Brand wanted to leverage subscription services, which shifts companies from a CapEx to an OpEx operating model.
Hosting company applications, Lucky Brand was after consistency and reliability. The company had a disparate architecture, multiple cloud platforms, including Amazon Web Services, and multiple colocations, but it wanted a simplified cloud portfolio, Nehring said.
A streamlined technology stack would allow the company to tap into containers and shift workloads in the event of economic changes or to leverage additional capabilities in the future.
Tapping Microsoft and Azure VMware Solutions, Lucky Brand spun up existing relationships with the vendors for cloud migration.
Microsoft has an added advantage: It is the market leader in enterprise SaaS and boasts suites of applications that easily integrate with its IaaS and PaaS solutions.
Buying into multicloud
Lucky Brand credits its centralized applications with helping to cut IT operating costs 55%, according to Microsoft's announcement. The shift also allowed the retailer to tap into analytics to better understand customer activities.
While focus is on Microsoft for now, Nehring envisions Lucky Brand will be like most other companies and have at least two cloud providers. If an independent software provider does not operate on Azure, for example, the company might add second cloud provider as the alternative to its primary vendor.
More than 80% of companies have a multicloud strategy running, on average, 4.9 private and public clouds, according to Rightscale research.
Multicloud strategies emerge as companies use of cloud matures, according to David Smith, distinguished VP analyst at Gartner, speaking at the Gartner IT Symposium/Xpo in Orlando, Florida in October.
Most organizations start with one provider. As they mature, companies worry about too much reliance on a single vendor or reliability if a vendor goes down, Smith said. Some companies consciously distribute workloads across multiple vendors.
Others, Smith said, tap vendors for specialties as part of a multicloud strategy. While a company could choose Microsoft Azure or AWS as a primary vendor, they might look to Google Cloud for machine learning and analytics.
When Nehring was evaluating Lucky Brand's technology platform, it was difficult to understand where all the applications were across multiple colos and clouds.
"One of the biggest impediments to the business was really the access to the data and the ability to be analytical and really understand what the data and the transactions were telling" the business, Nehring said.
With the technology transition, Lucky consolidated customer data to provide insights on what customers were doing across channels.
A customer could buy a pair of jeans in a store and Lucky Brand would have record of that transaction. The same customer could later navigate to the company's website and purchase a T-shirt or a number of accessories.
Previously the data on the single customer would remain in a silo. With a consolidated platform, Lucky Brand could understand the customer's behavior by tying customer transactions together and offer predictive selling.
Nehring's goal is to integrate all customer channels and create a more holistic view of their consumer experience, he said. But another side is making operations more efficient and streamlining the supply chain and customer services to offer more real-time capabilities.