Boots Plc to boost customer loyalty with IBM's help
UK-based healthcare retailer, Boots, is to outsource technology innovation to IBM in a £710 million (US$1.1 billion) deal. The ten year deal is expected to save Boots some £130 million pounds, and provide a much-enhanced customer experience in its stores.
Throughout the ten year contract, Boots wants to use the opportunity to help implement strategic changes to its business operations, making use of IBM's portfolio of consulting, hardware, software, and services.
The Boots Company expects to save £130 million through its new partnership with technology giant, IBM, by way of increased cost efficiencies in its IT operations. These savings will be reinvested in change-enabling technologies aimed at increasing customer loyalty and gaining a competitive advantage.
Creating technology The deal represents IBM's first such retail partnership in the UK, and the two companies are establishing an 'innovation centre' in Nottingham that will develop new uses for advanced technologies at Boots.
At the new centre, IBM's technical experts and retail industry consultants will work to help Boots use technology to enhance the customer experience and implement the desired operational efficiencies.
New technologies that may eventually be employed in Boots stores throughout the UK include wireless and mobile solutions that will enable the firm's employees to serve customers more quickly and efficiently.
"Our success hinges on our ability to keep bringing innovation to our customers, stores, products and services," said David Lister, chief information officer for Boots. "IBM will help us use technology to create world class customer experience, and to enhance our service and products."
Managed IT infrastructure IBM will also provide the necessary database management and applications maintenance to support Advantage Card (the firm's smart card loyalty programme), which claims a member base of around 14 million card holders.
In addition, IBM will manage all of Boots' computing infrastructure, including its data centre, in-store systems, data networks and telecommunications. It will also deploy and manage new point-of-sale systems in Boots' 1,600 stores, along with in-store kiosks for Advantage Card holders. As a result, over 400 Boots employees will be joining IBM.
"IBM is going to provide the challenging thinking and technologies that Boots needs to support its business growth," commented Richard Atkins, general manager for IBM Global Services. "We are going to help Boots increase the pace of innovation."