AU retail sector to spend $1.94bn on ICT this year

ICT spending by the Australian retail sector is projected to slowly but surely edge past the $2 billion mark between now and 2016, IDC Australia projects.

The research firm expects spending to reach $1.94 billion in 2013. While demand from the sector is growing slowly, the total market is on pace to reach $2.02 billion in 2016, representing a CAGR of 1.2%.

Demand from the retail sector is dominated by telecommunications investment, which IDC estimates will account for 43% of total ICT spend this year.

But partly as a result of retail players placing a greater priority on software and services, total spending on telecom services by retail is expected to decline at a -2.6% CAGR over the three-year period.

IDC Australia head of vertical markets for APAC Emilie Ditton said the sector as a whole remains focused on cost management-related technology deployments.

“While there are pockets of innovation within the retail sector - which are growing - we are really still seeing the focus of ICT spending being in support of the delivery of day-to-day operations,” she said.

But IDC does expect ICT spending habits by the sector to shift towards newer technologies that reflect changing retail patterns and shopping habits.

With retailers under pressure to enhance their omni-channel capabilities, investments surrounding the ‘four pillars’ of analytics, mobile, cloud and social business are projected to increase.

Image courtesy of Amanda Slater under CC