For a look ahead at the trends that will animate the retail industry this year, let’s take a look back at the 2022 National Retail Federation (NRF) “Big Show” in NYC.

Attendees at January’s event were treated to tangible examples of how retail challenges are being solved today, including new solutions to help them parse customer expectations and buying patterns, adapt stores into omni-channel experience hubs, and improve data visibility and actionability.

NRF 2022 also took the “omni-channel everything” theme of last year’s show to the logical next level: Enabling the best hybrid experiences. The message came through loud and clear of the importance of integration and interoperability in this new hybrid world – making everything work well together.

The need for modern digital infrastructure to enable this blending of physical and digital retail smoothly is paramount. To that end, technology vendors demonstrated how digital transformation initiatives, such as contactless and real time IoT and mobile applications, need to be built on cloud, edge, and secure connectivity to allow retailers to achieve the modern seamless hybrid retail that today’s consumer wants.

Other prominent themes and technologies highlighted at NRF included: extending engagement in the metaverse, sustainability, physical and digital security, and the agility and adaptability imperative.

The Metaverse and Hybrid (Omni-channel) Experiences

Today, the metaverse is an extension of our lives, enhanced by technology, which exists as a series of virtual worlds. In the future, the metaverse will be an interconnected, endless world where digital and physical lives fully converge. Imagine waiting for an appointment at a real booth on the NRF show floor while your avatar roams a fully fleshed-out digital NRF, meeting other virtual attendees, stopping for coffee at the digital Starbucks, and paying for a coffee that an in-the-flesh Starbucks employee brings to them. Digital and physical selves merge seamlessly in the metaverse, as the worlds draw closer together.

In the metaverse, brands have a digital presence, too. Nike filed seven trademarks late last year, including those for “Nike,” “Just Do It,” and its swoosh logo, and posted openings for virtual designer roles, indicating its intent to make and sell virtual branded sneakers and apparel. It subsequently purchased RTFKT Studios, a company that already makes and sells NFTs and digital sneakers. (In one collaboration with teenage artist FEWOCiOUS, the company sold 600 pair/NFTs of sneakers in just six minutes to the tune of more than $3.1 million.)

The metaverse also opens possibilities for gathering data about consumers and product demand. Imagine a sneaker drop in the virtual world. Certain styles of new kicks sell like gangbusters, giving the brand insight into what might sell IRL, intelligence that leads to trend-right production and less inventory headed for markdown or landfills. The metaverse can be a vehicle for more sustainable operations.

The metaverse further bridges the narrowing gap between digital worlds and physical worlds. Most consumers aren’t outfitting an avatar, but they are moving between online and offline and expect retailers to accommodate those hybrid omni-channel journeys seamlessly. Those demands have accelerated around last-mile delivery and experiences such as buying online and picking up in store (BOPIS) or at curbside, shopping in store and returning merchandise online, adding items to a BOPIS purchase when at the store, or communicating a substitution to the third-party grocery delivery service

Hybrid experiences open opportunities to please the consumer in new ways, but they also add expense and complexity. The need to meet this demand while enabling profitability was a major theme behind many of the technologies discussed at NRF. These included artificial intelligence (AI) for recommending the right product, return logistics software for defining and guiding product-specific reverse logistics workflows, order orchestration and fulfillment applications for omni-channel shopping, and last-mile delivery visibility for optimizing customer experience, to name a few. Also on display were task management applications help to improve and optimize in-store employee engagement, as well as touch-free applications to allow for faster payments and customer self-service checkout. RFID continues to improve inventory accuracy and inventory locating on the shelf, throughout the store, and the supply chain.

Sustainability

NRF 2022 saw a strong focus on sustainability. An NRF/IBV study released at the show highlighted the significant embrace of sustainable shopping by consumers. According to the survey, 62% of shoppers are “willing to change their purchasing habits to reduce environmental impacts.” About half indicated a willingness to pay a premium – on average a 70% premium – for sustainable products and brands.

Retailers are working to improve sustainability and reduce carbon footprint across operations by using sustainable sourcing through the supply chain, the store, and even returns. Tech vendors unveiled a variety of solutions enabled by cloud/edge, AI, computer vision, and IoT/RFID to allow retailers to effectively measure and record their environmental efforts, with the goal of reducing their impact.

Several cloud and digital infrastructure providers showcased sustainability clouds and other technology aimed at asset management with the goal of reducing energy consumption, water usage, waste. Examples included using IoT sensors to reduce water usage, optimizing re-use of store assets, and dashboards that allow retailers to accurately monitor and measure carbon output. However, such sustainability solutions can be most successful when running on the next-generation digital infrastructure that helps retailers better compete and differentiate in today’s omni-channel world.

Physical and Digital Security

According to a 2021 NRF survey, 57% of U.S. retailers reported the pandemic led to an increase in organized retail crime, while 50% reported an increase in shoplifting. When IDC’s Future Enterprise Resiliency & Spending Survey, Wave 10 (November 2021) asked retailers which digital infrastructure investments would provide the greatest strategic advantage in 2022, their #1 response was “cybersecurity and recovery investments.”

A wide range of technology vendors acknowledged retailer concerns with regards to security, fraud, and loss prevention:

• Networking, connectivity, and edge vendors highlighted multilayer security solutions that promise to protect data from a range of IoT applications that utilize customer and associate data. Many offer security consulting services to address varied threats including ransomware, retail crime, and loss prevention.
• Security and e-commerce security vendors showcased solutions to prevent fraud and abuse in e-commerce applications as well as omni-channel applications such as BOPIS and curbside pickup, using AI-based analysis for identifying “bad”/risky customers and mitigating risk.
• Cloud vendors highlighted how retail clouds provide consistent, reliable identity management and data security.
• POS/payments/store technology vendors emphasized their ability to handle payments securely from any platform with multifactor tokenization, improved identity techniques such as biometrics and voice authentication, as well as AI-enabled and computer vision solutions for loss prevention at checkout and at the door.

The Agility and Adaptability Imperative

On display at the show were multiple flavors of the digital infrastructure technology that retailers need to achieve agile, personalized, data-driven, integrated seamless operations across the many channels of today’s retail landscape. The emphasis was apt. More than half of retailers plan to boost investment in business agility and operational agility over the next 12 months, according to IDC’s Future Enterprise Resiliency & Spending Survey, Wave 10 (November 2021).

Technology vendors highlighted their connectivity investments to enable business and operational agility and their technology investments for better ease of integration, scalability, and the ability to more easily swap out or mix and match applications with integrated platforms, open systems, hybrid cloud, and retail industry clouds.

Vendors also showed off infrastructure to better harness data while enabling its visibility, maximizing its value, and providing the data-driven personalization essential for competitive advantage and differentiation. Highlights included fast, secure connectivity, 5G and Wifi-6, and edge- and cloud-enabled data and AI platforms to generate real-time insights – all designed to enable today’s omni-channel retail.

Advice for the technology buyer

Retailers should consider these key themes from NRF 2022 when making technology investment decisions for 2022 and beyond. To avoid lagging behind those retailers already moving toward thriving into the future, take action to:

• Enable the seamless, contactless omni-channel approach that today’s consumers want and expect.
• Replace legacy infrastructure that was not built to handle the modern retail environment that requires the agility and adaptability to seamlessly connect rapidly increasing volumes of data securely and more quickly than ever.

Whether sustainability, adaptability, the metaverse, or security are top concerns, addressing business needs holistically and strategically should be job #1.

Continue the conversation by downloading our Transforming retail and CPG markets whitepaper today.

Yesterday we held our final Google Cloud Security Talks event of 2021. Our event focused on zero trust and covered everything from Google’s history with BeyondCorp to our strategic thinking when it comes to applying zero trust principles to production environments. We shared product updates across the portfolio and talked about how zero trust fits into our invisible security vision.

In case you missed the event, we’ve put together a brief recap below. Of course, we’d also encourage you to check out the sessions on-demand for all the details!

Our opening keynote highlighted many recent security launches, including:

• the general availability of Cloud IDS, which helps detect network-based threats, including attempts to exploit the Apache Log4j vulnerability; 
• the new Mute Findings feature for Security Command Center which helps organizations more effectively manage their security posture on GCP based on their policies and requirements;
• and the Threat Horizons report, a new report by the Google Cybersecurity Action Team (GCAT) describing recent threat intelligence observations from teams across Google.

We then brought together security leaders across Google for a panel discussion of our zero trust vision. Our panelists emphasized the need to embrace the fact that security is not static which makes adoption of a zero trust mindset where trust is established via multiple mechanisms and verified continuously an imperative. The session also highlighted how even taking small steps – such as prioritizing specific applications as you begin your zero trust journey – can still have a large impact on improving your security posture.

Next, we covered some recent product announcements from the BeyondCorp Enterprise team, including the new Policy Troubleshooter feature. This session gave users a closer look at new product features across access, signal integrations, and threat and data protection capabilities leveraging machine-learning in real-time.

We then pivoted the conversation and two of our speakers shed more light on Google’s BeyondProd approach. First, we shared our learnings from building a cloud-native security model, which provides significant benefits to both application development and security teams. We outlined different principles you can apply to your infrastructure design and operations in order to strengthen the deployment of your workloads, better secure their communications, and limit their exposure to other workloads, in ways that can ultimately reduce the burden on individual developers.

We discussed how customers can bring BeyondProd to life in their own environments and offer zero trust protection for workloads with Google Cloud capabilities. These sessions featured customers who shared their experiences with VPC-Service Controls and Certificate Authority (CA) Service. We also announced some exciting news: CA Service now supports third-party identity federation and can issue certificates to attest to on-premises third-party identities using Google Cloud workload identity federation. Certificates can be issued for both users and workloads. 

Next, in light of the White House effort to deploy a zero trust model across the US federal government, we spent some time sharing how Google Cloud can support government guidance. Google recently announced a $10 billion investment to strengthen cybersecurity, including expanding zero-trust programs, helping secure the software supply chain, and enhancing open-source security. This session gave an overview of how different Google Cloud services align to federal cybersecurity priorities.

Our last session provided an overview of how we are strengthening security and privacy across the Google Workspace platform applying zero trust principles to the applications that allow customers to collaborate effectively with features such as Trust Rules for Drive.

These sessions will be available on-demand on our Google Cloud Security Talks page for you to reference. If you’d like to speak with a representative about Google Cloud’s zero trust access solutions, please fill out this form. Lastly, if you are planning to attend the 2022 RSA Conference in San Francisco (February 7-10, 2022), check out goo.gle/rsa-2022 to arrange a meeting with our team at the event.

Google has long looked to Israel for globally impactful technologies including popular Search features, Waze, Live Caption, Duplex and flood forecasting. At our Decode with Google 15RAEL event last week, we celebrated 15 years of Google innovation in Israel and our longstanding support of the country’s vibrant startup ecosystem. 

Over the years, we’ve expanded our enterprise investments in the country, too. In addition to our over a decade long investment in the space, Google has acquired Israeli-based companies like Alooma, Elastifile and Velostrata, and Uri Frank joined Google Cloud last month to lead our server chip design team from our offices in Tel Aviv and Haifa. 

As we continue to meet growing demand for cloud services in Israel, we’re excited to announce that a new Google Cloud region is coming to Israel to make it easier for customers to serve their own users faster, more reliably and securely.

Our global network of Google Cloud regions are the foundation of the cloud infrastructure we’re building to support our customers. With cloud’s 25 regions and 76 zones around the world, we deliver high-performance, low-latency services and products for Google Cloud’s enterprise and public sector customers. With each new Google Cloud region, customers get access to secure infrastructure, smarter analytics tools, an open platform and the cleanest cloud in the industry. 

Having a region in Israel will help accelerate innovation for customers of all sizes, including PayBox, a digital wallet application owned by Discount Bank, one of Israel’s largest banks. “When we acquired PayBox, our goal was to improve the security and the user experience for its products, but we also wanted to keep the startup’s agility and innovation. Google Cloud has enabled us to do just that,” said Sarit Beck-Barkai, Managing Director of PayBox at Discount Bank.

“We are very excited that leading vendors like Google are investing and launching a local cloud region in Israel. This will make a significant change in the technology landscape of the public-sector, enterprise and SMB markets in Israel. Matrix is proud to be a major part of the transition to the cloud,” said Moti Gutman, CEO at Matrix, technology services company and Google Cloud partner. 

“In the last year, Panorays more than tripled its customer base and scaled its infrastructure, practically at the click of a button. Google Cloud made it easy for us to scale without worrying about DevOps, which meant that our engineers could focus on developing new and better features for our customers. The new region launching in Israel will allow us to serve our local customer base even better, as we’ll be able to experience higher availability and deploy resources in specific regions, thus reducing latency.” said Demi Ben-Ari, Co-founder and CTO, Panorays, a third-party security platform and Google Cloud customer.

“This new cloud region will provide even better access and growth potential for our mutual customers with tech hubs in the region. We are serving hyper growth companies who need Google Cloud’s services and will benefit greatly from this regional presence,” said Yoav Toussia-Cohen, CEO of DoiT International.

When it launches, the Israel region will deliver a comprehensive portfolio of Google Cloud products to private and public sector organizations locally. We look forward to welcoming you to the Israel region, and we’re excited to support your growing business on our platform. 

Learn more about our global cloud infrastructure, including new and upcoming regions, here.

Twenty years ago, organizations discovered the magic of server virtualization. Among the many benefits of virtualization, it heralded the end of the need for one physical server per application and the beginning of managing software-defined infrastructure. It helped automate building and installing systems, and it helped lay foundations for today’s Continuous Integration/Continuous Delivery mechanisms and DevOps practices. However, the adoption of virtualization was not always smooth and several hurdles stood in its path. Today’s organizations are facing similar obstacles in their journey to the cloud.

Organizations that wanted to virtualize their server environment two decades ago faced a significant challenge that was neither technical nor budgetary, but organizational, stretching across IT teams and beyond. The first team to be concerned about virtualization was the one in charge of installing the physical servers in the racks of the datacenter, managing the physical network connections and operating environmental controls, such as HVAC and power systems. These tasks were drastically reduced, if not outright eliminated.

The second team affected by this shift in technology was the one responsible for installing the operating system and running the post-install procedures. Their job almost completely disappeared as most virtual machines were automatically instantiated from templates.

As a result, successful adoption relied on the ability to smooth these organizational changes. Along the way, training the staff and making sure they acquire the new skills necessary to operate the virtualization infrastructure was critical. And usually, the affected teams eventually found that their new responsibilities were different but still essential to the organization, and perhaps even more appealing.

Virtualizations lessons for cloud transformation regulators

Discussions on virtualization didn’t end with these internal changes when organizations were operating in a regulated environment. They needed to engage closely with their regulators. Regulated organizations often considered the hypervisor solely as an additional layer of software with potential vulnerabilities.

This viewpoint raised risks (such as virtual machine escape) that didn’t exist with physical servers. Even if this is taken into account and the risks mitigated, it should have been considered in balance with all the benefits of machine virtualization, including security benefits such as asset identification, harmonization, and smoother patch management.

While the relevance and benefits of virtualization are now widely accepted, history has repeated itself as similar issues have arisen for organizations facing cloud migrations. When large cloud service providers (CSP) began supporting critical workloads for their customers, regulators increased their oversight over CSPs and issued guidance concerning cloud adoption. This happened in the European financial sector, with guidelines from the European Supervisory Authorities (European Banking Authority, European Securities and Market Authority and European Insurance and Occupational Pensions Authority,) and the coming Digital Operational Resilience Act regulation.

These regulations can help establish trust between providers and customers. As regulator decisions are vital for organizations, there is an opportunity now with cloud technology to balance the risks with the benefits and take into consideration all the ways CSPs can help organizations improve their overall security and compliance levels.

Cultural transformation can drive cloud transformation

Another similarity between cloud transformation and the journey to virtualization is the required internal transformation. When an organization decides to start its journey to the cloud, training its staff with the new technology and tools is a necessary step, but probably not the first nor the most arduous to make. A change of mindset is paramount to fully incorporate all the cloud benefits, in particular regarding security.

This new approach begins with a deep transformation at the organizational level. Organizations should avoid viewing the cloud as a datacenter because there’s so much more potential to cloud technology. This new approach and its accompanying organizational transformation is driven by two factors: The burdens that the CSP removes from the customer, and the new flexibility that software-defined infrastructure brings to the table.

The CSP directly manages several tasks and services, and their security, which means that they’re no longer a direct concern for the customer. These responsibilities include data center management, security-hardened hardware, default encryption for data at rest and data in transit, and resilient network management.

Since all the infrastructure used by the organization to manage its workloads is software defined, it brings much more flexibility to what can be done with it. Software-defined infrastructure can more easily enable security guardrails and continuous compliance that weren’t possible before.

While there’s a temptation to approach an organization’s cloud transformation as merely a “lift and shift” operation from on-premises infrastructure, the reality is that approach reduces the potential gains a cloud transformation can bring to an organization. Moving systems to the cloud accounts for a small portion of the potential impact, while updating the mindset can be truly transformational. Development, architecture and security processes need to be rebuilt; this inevitably requires a deeper transformation of the organization.

The next step is to transform the operations, to align them with the overall organization and the new defined processes, operationalize CI/CD and build DevOps practices. After that, the technological gap will be adjusted, moving the new tools and teaching teams how to best use them.

The important point here is the order of the transformation to manage: organization, operations and technologies (O-O-T) and not the other way round (T-O-O). Of course, these three steps should not be considered completely sequential, as technology plays an important role in the organization and the operations. However, it is essential to support the development of personnel and frameworks to take full advantage of the transformation opportunity, rather than primarily focusing on the tooling.

In addition, at Google Cloud, we believe in a shared fate that goes far beyond the usual shared responsibility model. We think it is part of our duty to help our customers to achieve their goals in their scope of responsibility. We prepare secure landing zones and guide the customers, we bring transparency to security controls and help them with cyber-insurance.

Our shared objective with our customers is to continuously improve security. Our Google Cybersecurity Action Team initiative helps us to be engaged alongside our customers, provide them with necessary guidance, support them in their security and compliance strategies, and assist their organizational and operational transformation in their cloud journey.

• Listen to a related podcast “How to Apply Lessons from Virtualization Transition to Make Cloud Transformation Better”
• Listen to “Preparing for Cloud Migrations from a CISO Perspective, Part 1”
• Read “The journey to the cloud mitigates enterprise risk”
• Also, review “Megatrends drive cloud adoption—and improve security for all”
• Visit Google Cybersecurity Action Team website