Everywhere in the world, from grandmothers to multinational corporations, we’ve seen a tsunami of people moving to online and mobile technology to share information more effectively.And I’ve watched a number of retail-focused companies (some customers and some not) make this leap into 21st century technology by sharing market intelligence to make better, faster real estate decisions. I’ve also seen a bunch that looked, but then chose not to leap. Given the fact that all the companies I know of that did leap would never go back to the old days (nor would the grandmothers), what exactly are people afraid of? In Part 1 of this series, I’d like to look at what we mean by new technology, particularly the stuff that scares people involved in retail real estate.
Let’s start by defining what we are NOT talking about. We’re not talking about sales forecasting models. These do not scare people. In fact they do the opposite. Some people cling to sales forecasting models the way a child clings to a security blanket. “The model will protect me… I just know it will.” This is dangerous as hell, but it’s the opposite of scary to the people involved.
What I am talking about is the same thing that new online and mobile technology have been doing for years – helping people to share information. Let’s face it, you know a lot more about your “Friends” on Facebook than you would if you weren’t on Facebook with them. You know their sense of humor, their politics, where they go, and what they do. You get a lot of information about them that you otherwise wouldn’t. Most of this information is useless (or worse). But what happens when we apply this same concept to our business?
In business, when people share relevant information, particularly with decision makers, better decisions get made. People can save time, and therefore money, because they spend less time looking for information or spend less time doing pointless things that good information would have let them know was pointless.
What’s not to love? Well, if you work in retail or retail real estate, apparently a lot. Many people view their value to the company in terms of the information that they control. This is true of retail real estate professionals and research people – both control information that is valuable to the company. IT protects information from getting into the wrong hands. And the C-Suite views new technology as something best left to the experts, because they don’t understand it and that scares them.
The C-Suite knows that new technologies can be risky and that they know little about them. Many grand technology visions have ended with large write-offs, hurting the bottom line and this is very scary to them. They have no way of knowing whether a given foray into new technology is going to be a smashing success or a disaster for the bottom line, right? (Spoiler Alert — It doesn’t need to be! More in Part 2)
In the case of the real estate professionals, they know their markets. If the company purchases third-party store location data, it is not extremely accurate nor up-to-date. They are the only ones that truly know “what is where” in their markets. This means job security. If they shared what they know with people in research, merchandising, marketing, pricing and other departments who (by the way) would really, really benefit from this information, they’d be replaceable, right? (Second Spoiler Alert — Wrong! More in Part 3)
With respect to IT, all you have to do is say the words “share information” to completely freak them out, and with good reason. A great deal of information has been “shared” in recent years with Chinese and Russian hackers with very little return on investment. They believe that sharing information could make the company less secure. (Third Spoiler Alert — it can make it MORE secure. More in Part 4).
In the case of real estate research, these people spend a lot of their time producing maps and reports for real estate as well as other departments. If they suddenly shared their abilities and gave all those people the tools to create their own maps and reports and do their own analyses, they’d quickly be out of a job right? (Fourth Spoiler Alert — Wrong Again! More in Part 5)
So lots of people are very, very afraid of new technology for retail real estate. And I have made the (at this point) unsubstantiated claims that they are all wrong. Over the next few weeks I will spend some time looking at each of these groups of people. Then I’ll follow up with conversations with people who have made the leap so you can see how they saw past the scary stuff and what kinds of rewards await on the other side.
If you would like to download a PowerPoint on Analog Models that I presented in a webinar on February, please click the button below.