by Brian Kilcourse, Managing Partner

In RSR’s recently published study on the state of Cloud Computing in Retail, retailers highlighted a pragmatic point-of-view for moving forward with new technologies: they expect to operate in dual mode (a hybrid of on-premise and cloud-based applications) for years. As we summarized in the report: “Few companies have the luxury of being able to re-tool their computing environment from the ground up. The analogy of ‘changing tires while driving the car’ is an apt one. “

The same can be said for technology solutions providers, including Aptos. At the Aptos Engage conference held two weeks ago in Orlando, CEO Noel Goggin cited the “overwhelming rate of change ” happening in the industry – but he also urged retailers to not “get distracted by shiny objects – get the fundamentals right “. It almost sounded like he was talking to his team as much as to the retailers in the audience. That seems to be where the industry is in 2019 – as I summarized following the NRF 2019 annual event in January:

“…Retailers can’t replace all their technology at once… just because retailers may know that they need to refresh or replace virtually every technology solution in their portfolios in addition to invest in new automation, that doesn’t mean they can or will drop everything and launch into a multi-year ‘re-invention’ initiative… So smart solutions providers are finding ways to offer bridge technologies that can help retailers offer new functionality and a new look-and-feel to old functionality, so that they can move forward to implement the more interesting and rewarding add-ons that consumers demand. “

The two objectives of getting the fundamentals right and implementing add-ons that consumers demand – are driving the Aptos agenda. To address them, Aptos is pushing hard on several fronts.

The first of those is Enterprise Order Management, or EOM. According to Goggin, the company has “industrialized ” EOM in order for it to be an “omnichannel operations suite “. Broadly, EOM includes services for that the company calls “Engage ” (customer personas, preferences, transaction histories, and interactions), “Find ” (inventory lookup and control), “Transact ” (selling services, including price, payments, commissions), “Deliver ” (including customer delivery and returns), and “Improve ” (data analytics). An underlying assumption in EOM is that the store is and will be the center of omnichannel operations, and so (according to Noel) the objective is to improve the employee experience, support the ability to commit inventory for sale, and embed the analytics required to achieve new levels of operational excellence and customer satisfaction.

On another front, Aptos has successfully implemented its next-generation selling system APTOS ONE at several retailers (according to Noel, “the plumbing is done, and now we’re building the house; we’ve recently added 100 developers ” to help the company build out the functionality). The CEO stressed that ONE is the company’s innovation path for the future, but that it is “not a POS replacement strategy “. Instead, Goggin positioned ONE as a “broad set of customer engagement services ” that has been designed to work side-by-side with the company’s STORE 6 POS system. For example, ONE and STORE data can be combined, which in turn enables a retailer to handle a return for a transaction generated in ONE in any store.

The advantages that Aptos touts as an outcome of ONE’s cloud-centric design include:

• Pop-up stores get easier (to help justify the investment with a near term ROI)
• API calls to outside services are enabled, including APTOS CRM, SAP, or other “foreign ” applications
• Integration with payment partners is easier
• Web apps for reporting, admin, etc. are available

On a third front, Aptos is expanding the capabilities of its merchandise planning application (the former TXT Retail) by applying AI analytics to the planning process. To get a better flavor of this, I attended a breakout session with Nick Leeper, the Director of Product Management at Aptos. Nick explained that when it comes to demand forecasting, the benefits to be had from integrating AI capabilities include the ability to better predict sales using an array of new inputs (for example, social media) to be modeled in order maximize accuracy. The use-cases that Aptos is focused on include short, medium, and long term forecasts, planning for new product rollouts, improving depth & breadth predictions, pricing, and markdown analysis.

Sauce For The Goose, Sauce For The Gander

At the Aptos Engage conference, keynote speaker Nicholas Goad (Partner and Managing Director at Boston Consulting) outlined a vision of what shopping will be in the near term future:

• “No chores in the stores ” – shoppers will increasingly opt for quick purchase and delivery of everyday replenishable items; this is giving rise to the popularity of Click & Collect (or BOPIS);
• “Personalized customer journeys ” – customers will increasingly demand relevancy from retailers – they don’t want to either click through or walk past items that mean nothing to them in the context of their lifestyle needs;

• “New channels ” – new ways for consumers to connect to providers are always expanding;
• “Multi-fulfillment ” – a single customer order may be fulfilled in more than one way;
• “Automation of operations ” – retailers will seek hyper-efficiencies in their physical operations;
• Marketing, digital selling, and customer order fulfillment will drive opex;
• Store footprints will get asset-light.

What struck me as I listened to Mr. Goad speak is that these things that will happen in the future – they are happening, right now. And that explains why Aptos is pushing hard to offer new capabilities that can live harmoniously with their own legacy systems. Simply put, retailers are headed there too. Consumers aren’t going to wait for retailers while they engage in expensive and risky “rip and replace ” strategies, and so retailers have become focused on modernizing their technology portfolios by front-ending operational legacy capabilities with (frequently cloud-based) customer-facing solutions.

And so Aptos is pushing the “go faster button ” by hiring 100+ new developers, because very clearly retailers want to get to solutions. The good news for the solutions provider is that customer case studies are coming forward that tell the story. In one case, from Cole Haan, the point was made that Aptos “checks the boxes ” on basic capabilities (eg: enterprise inventory visibility, dynamic delivery routing) plus has some “secret sauce ” (single integration interface, open APIs, a “lego building block ability “).

Sauce for the goose is sauce for the gander.