Milan, Italy, September 5, 2002 - Despite a worldwide economic slump, IT spending in the Western European retail and wholesale sectors is expected to grow in 2002, with IT investments increasing 7.4% and 6% respectively, according to a new study by IDC.
Software will attract the largest share of the forecast spending by retail companies, growing from $4,581 million in 2001 to $9,330 million in 2006. "With the increasing penetration of wireless devices among Western European retailers the need for security software will increase," said Cinzia Rinelli, Senior Research Analyst with IDC's European Vertical Markets group. "The need for cost cutting to increase profit margins will drive demand for SCM, collaboration software and CRM to enhance customer relationships."
Given the increasingly competitive environment, greater attention to customers' needs is expected. Established brick-and-mortar retailers have a crucial advantage over Internet-specific enterprises, both in capturing and retaining new customers. Integration of online and offline activities is expected to grow, and the most successful retailers have focused on a multichannel approach, integrating in-store and online customer management.
European wholesale's IT investments reached an estimated $12,795 million in 2001 and this is forecast to grow to $18,936 million by the end of 2006. Wholesalers will allocate their IT budgets mainly on the acquisition of software, like retailers, with double-digit growth every year between 2002 and 2006.
Hardware spending is still declining in 2002 both in retail and wholesale, with flat growth of 4% to 5% expected till 2006 and a CAGR of 3.2%. Wireless devices are likely to characterize the trends of the retail sector in the next few years, given that systems such as wireless POS typically operate over a wireless LAN. Wireless technologies allow various devices to send and receive data within the network.
The HoReCa (hotel, restaurant, cafe) subsector is strongly dominated by microenterprises in Europe. Tourism is expected to show a strong concentration of establishments, with domestic tourism dominating, especially at the seaside. Rural tourism is showing a growing trend in Western European countries. Smaller hotels are increasing their investments to raise their profile on the Internet, while larger hotels are integrating their Web sites with existing CRM. IT spending by European HoReCa companies is estimated to reach $176 million in 2001 and $257 million by 2006.
The study, IT Spending in Retail/Wholesale, Forecasts and Analysis, 2001-2006 (IDC #PW01J), offers an up-to-date overview of IT spending trends and forecasts in the European distributive industries. Starting from trends affecting IT demand in the European retail and wholesale markets, the study explores major drivers and trends in IT adoption. On the quantitative side, the focus is on spending in hardware, packaged software and IT services for the major European countries. Forecast data is split for the following subsegments: retail (distribution, motor trade and HoReCa) and wholesale. The study is available to purchase from your local IDC office.
About IDC
IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at www.idc.com.
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For more information, contact:
Cinzia Rinelli
+39 02 2845 7367
crinelli@idc.com