Retailers Expand IT Labs to Keep Pace With E-Commerce

Cyber Monday has come and gone, but retailers are building IT labs to create new features for their e-commerce sites and leverage customers’ use of smartphones and tablets.

E-Commerce CheckoutFor brick-and-mortar companies like Walmart, Target, Kohl’s, Staples and American Eagle, R&D has extended beyond efficient supply chains and point-of-sale systems. They’re among the roughly half a dozen retailers that are building IT test labs in Silicon Valley and San Francisco. Walmart, a pioneer in the test lab concept, plans to open a second area lab near Sunnyvale, according to the Associated Press.

Beating Back Amazon

This move by retailers to use technology labs comes as Amazon continues to eat into their business and customers increasingly rely on websites to do their shopping. Online sales jumped to 7.6 percent of the $3.1 trillion retail sales market last year, from 5.9 percent of the $2.64 trillion in sales in 2009, according to Forrester Research.

This means that retailers are facing the same challenges in hiring IT talent as everyone else. That’s forcing them to behave more like typical Silicon Valley startups with ping pong tables and amenities like treadmill desks.

U.S. big box retailers aren’t the only ones building IT labs in the Valley. So are their foreign competitors. RetailWire says that in November China’s largest electronics retailer, Suning Commerce Group, opened a facility there.