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Retailers look to hybrid cloud as they search for flexibility - report

15 Jan 2020

Enterprise cloud computing company Nutanix has announced the retail industry findings of its second Enterprise Cloud Index Report, measuring retailers’ plans for adopting private, hybrid and public clouds.

The report 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’s a critical factor in winning new customers and retaining existing ones — and 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, demonstrating 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: Unlike in the broader IT industry, where cost is the top driver, 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, with hybrid cloud specifically identified as the most secure (32%).

As data privacy regulations continue to tighten and expand, 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: Always innovating to keep pace with customers’ demands, retailers 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, with about 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,” says Nutanix product marketing VP Greg Smith.

“Retailers use data to connect the e-commerce and in-store shopping experiences, and 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, bringing 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.

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