Recently, we published our latest in a series of “State Of” reports for specific verticals, The State Of Cloud In Retail, 2023 available to Forrester clients now. Unlike more highly regulated industries like healthcare and financial services, retail has leaned on cloud heavily since the early days to power blazing-fast websites that scale with the peaks and lows of client demand. They were also quick to modernize back-end logistics with cloud platforms and cloud-native solutions. Like other industries, the pandemic accelerated multiyear digital transformation efforts to help build apps that offer features such as curbside pickups, omnichannel inventorying, and new digital services within weeks. While some of the high-growth cloud adoption we saw in 2020 and 2021 has fallen off, we won’t be returning to pre-pandemic usage either. Early cloud retail usage was localized to North America, Europe, and China, but cloud adoption has spread to other areas such as Thailand and Azerbaijan, which are also experimenting with cloud. Some key callouts from the report include:

  • Cloud-native use is growing. Retailers are using Kubernetes, cloud-native services to rework apps and modernize code, provide new digital services, or build in technologies to provide supply chain insight. Some are rearchitecting their programs to accelerate development, and many firms are rethinking how their point-of-sale (POS) systems work. For example, Colin’s built a centralized POS application in AKS (Azure Kubernetes Service) to manage all its stores from a single location for access to real-time insight into details such as a given customer’s shopping frequency, clothing size, and style preferences.
  • The internet of things (IoT) is a priority. Retail edge strategies predominantly focus on the use of IoT and modern networking customization such that they can power new digital experiences in brick-and-mortar store experiences. Companies have found differentiation with physical store locations but continually push to connect with the customer faster and provide unique customer experiences. Retailers are building these new IoT-powered digital experiences using cloud platforms.
  • Third-party services play a central role. Retailers are hiring third-party services to reskill their developers, manage their cloud services, and migrate their applications to the cloud. They play a valuable role in helping enterprises execute their one-time transformations and modernizations, filling operational gaps as they go.

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