This Downtime Causes 72 Percent of Retailers to Lose Sales and Negatively Impacts Security, Operations, Productivity and Customer Experience
TAMPA, Fla. – March 6, 2018 – “The Cost of Downtime: Beyond the Bottom Line,” a new study released today by Accelerated Concepts, now part of Digi International, (NASDAQ: DGII, www.digi.com), a leading provider of secure, enterprise-grade cellular (LTE) networking equipment for primary and backup connectivity applications, finds that despite advances in infrastructure, the overwhelming majority of retailers still experience unplanned connectivity outages at least once each year. While 72 percent of retailers surveyed indicated sales were lost during network downtime, the study also finds downtime severely impacts customer loyalty, employee productivity and overall business operations.
The study shows that 20 percent of respondents do not have backup connectivity solutions in place in the event their primary source goes down, proving that not all retailers understand the true impact of downtime to their businesses. Of those that do currently have a backup connectivity solution, 78 percent count on cellular LTE technology. As more and more retailers increase their dependence on internet-enabled technologies to run business operations, the cost of outages are dramatically increasing.
When the network goes down, retailers are faced with two options: close immediately, or stay open while waiting for support. The majority of respondents reported when the network is down, it can take up to four hours to get back in service. The majority of retailers surveyed noted they would close within two hours and less than a quarter noted they would stay open the whole day waiting for support.
However, those retailers that choose to remain open face limited operations that may cost more than revenue earned during the outage. For instance, during an outage:
- 61 percent cannot process credit cards
- 33 percent cannot manage inventory
- Nearly three out of four retailers are unable to run loyalty programs
- More than 70 percent cannot utilize in-store digital signage
- More than half of retailers see a decrease in employee productivity
“While loss of potential sales is the primary consequence of downtime, retailers cannot overlook the negative impact on employee productivity, customer experience and brand image,” said Jason Dorough, Vice President of Sales at Accelerated. “The majority of retailers, 80 percent, understand what is at stake and are implementing failover solutions to provide a stable network connection. Many are finding cellular LTE solutions to be affordable, reliable and easy to implement.”
Long Term Impacts of Network Downtime
The study also reveals the long-term impact, beyond financials, that downtime has on retailers. Eighty-two percent of respondents noted that network downtime can result in a negative customer experience, with nearly one in three retailers reporting that their brand reputation is damaged during an outage. When the internet is down, employees are left to appease unhappy customers as they’re unable to assist them with basic retail functions.
Because retailers often hold personal and sensitive customer data, any downtime they experience presents major security risks as well. The study found that more than half of retailers cannot enable security systems during downtime, leaving themselves vulnerable to data breaches.
“Unplanned outages are mostly short term issues for IT, but for a business owner, outages can have long term affects,” said Dorough. “All retailers set expectations with their customers in terms of the level of service they can deliver, so if an outage occurs and the store can’t deliver on those expectations, customers are more likely to bring their business elsewhere or express their dissatisfaction publicly. Because of social media, In a matter of minutes, word about a store’s downtime can reach across the globe. Using a failover solution with monitoring and incident management capabilities prevents retailers from becoming the next headline about a major service failure.”
For more information on the study findings, visit https://accelerated.com/downtime_survey. To learn more about Accelerated and its extensive line of enterprise-grade, primary and secondary cellular backup solutions, visit https://accelerated.com/.
About Accelerated – A Digi International Company
Accelerated Concepts, Inc. now a Digi International company, is a leading provider of enterprise wireless cellular network data hardware and services. Our solutions are used today in Fortune 500 companies and major Tier 1 telecommunications service providers. Founded in 2006 in Tampa, Florida, Accelerated Concepts, Inc. has offices in Tampa, Florida; Chicago, Illinois; and Brisbane, Australia.
About Digi International
Digi International (NASDAQ: DGII) is a leading global provider of business and mission-critical Internet of Things (IoT) and M2M connectivity products and services. We help our customers create next-generation connected products and deploy and manage critical communications infrastructures in demanding environments with high levels of security, relentless reliability and bulletproof performance. Founded in 1985, we’ve helped our customers connect over 100 million things, and growing. For more information, visit Digi's website at www.digi.com, or call 877-912-3444 (U.S.) or 952-912-3444 (International).
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