New Relic report: Observability quadruples retail ROI
New Relic has released its State of Observability for Retail report, highlighting the benefits that retail organisations are experiencing from investing in observability solutions.
The report draws from insights provided by 148 technologists and decision makers within the retail industry. It demonstrates that strategic investment in observability can yield a fourfold return on investment for retail businesses. This return is primarily achieved by enhancing digital customer experiences and improving operational efficiency.
New Relic Chief Technology Strategist Nic Benders elaborated on the findings, stating, "The findings in the report clearly show how strategic investments in observability not only drive technological innovation, but also lead to tangible business outcomes, enhancing customer satisfaction and operational visibility." This underscores the crucial role of observability in the retail sector's technological advancement and business strategy.
In preparation for high-demand shopping periods such as Black Friday and Cyber Monday, the report highlights how retailers are utilising observability solutions to minimise downtime and optimise customer journeys. The New Relic Intelligent Observability Platform is instrumental in addressing these challenges, with retailers enhancing their use of AI and IoT to boost resilience and streamline operations.
The uptake of observability tools like alerts and network monitoring is notably higher in the retail sector compared to other industries. Retailers reported a median mean-time-to-detection (MTTD) of just 32 minutes, leading to annual downtime that is 41% lower than other industries as documented in the wider 2024 Observability Forecast report.
The report also details future deployments of monitoring technologies that tie closely to digital experiences. Retail organisations plan to enhance their offerings with browser, mobile, and synthetic monitoring to refine digital customer interactions. Within three years, over half of the respondents expect to deploy synthetic monitoring, while nearly half anticipate adopting mobile and browser monitoring solutions.
Security, AI, and IoT are identified as drivers for observability adoption within the retail sector. AI, in particular, is a catalyst for improving decision-making and customer insights, as noted by 39% of the retail respondents. Similarly, cost management and customer experience management are pivotal strategies shaping the industry's attention towards observability.
Another significant finding is the sector's preference for a single observability platform to connect IT performance data with business outcomes. With tool consolidation becoming more prevalent, the average number of tools used by retailers has decreased from previous years, supporting the shift towards full-stack observability.
Goran Stefkovski, Chief Technology Officer at Kogan, equates the necessity of appropriate observability tools to those of a carpenter, saying, "Just as a carpenter has a suite of tools on hand to complete a job, running an effective ecommerce site requires that the right tools are used—it makes the team much more productive overall." This analogy highlights the importance of selecting integrated and efficient tools in maintaining an ecommerce site.
New Relic's observability solutions, tailored for the retail industry, meet these needs by providing comprehensive analytics and monitoring across various system layers, from application performance monitoring to IoT monitoring. These capabilities are designed to pre-empt disruptions, enhance user experiences, and facilitate a robust digital transformation strategy for retailers. The report serves to illustrate how observability practices can translate to improved performance and a competitive advantage in the digital marketplace.
