Retail innovation: it’s all in the details
Today’s headlines are full of stories about technology disrupting the retail industry—from robots and drones in stores, to mobile self-checkout and “scan & go” models, to a major European supermarket chain using blockchain to track milk.
These advancements highlight retailers’ increasing appetite for new technology, as they move toward the goal of a personalized, secure and frictionless shopper experience. With worldwide retail tech spending set to increase 3.6 percent to $203.6 billion in 2019 according to a Gartner forecast, the question arises: how can retailers make technology investments that best support their vision for the future?
As consumers seek increasing levels of personalization, flexibility and convenience, smart technology investments make all the difference. The right solutions deliver tremendous value to retailers, optimizing resources, increasing inventory turns, empowering associates, and ultimately driving sales and profitability. Selecting smart investments isn’t about installing the latest technologies – but deploying solutions that deliver real value. Executing with excellence has never been more important in retail, so even the smallest improvements in operations can yield significant business benefits.
With the right mix of technology and tools, retailers can operate seamlessly and efficiently while delivering differentiated brand experiences and achieving solid store performance. The idea of drone delivery might be compelling, but solutions that allow a shopper to quickly find that pair of jeans she’s been searching for will result in greater sales conversion and shopper loyalty. Here are a few steps retailers can take to transform their operations, optimizing the modern consumer’s shopping journey.
Step 1: Point technology at specific business challenges
Store labor has long been considered a top cost center in retail, but actually it’s the most important asset. Solutions that maximize this investment is a great place to start. Reducing non-customer facing tasks and freeing associates to focus on customers is a first step. In the “New Retail” world, stores are not just shopping destinations, but showrooms and fulfillment centers. Optimized staffing and matching the right skills to specific tasks is essential. As physical stores have become the face of retail brands, tools that empower and enable store associates to represent that brand and deliver unique, personalized service are foundational.
Better inventory management is another area to direct technology investments…this includes loss prevention solutions that reduce shrink and inventory management solutions to provide accurate visibility to merchandise anywhere across the enterprise. In today’s always on, always open retail world, meeting customer expectations around processes like BOPIS and ship-from-store have become table stakes. Quite simply, retailers can’t sell what they don’t have or can’t locate.
Step 2: Build upon existing technology infrastructures
One of the biggest hurdles to adopting new technology is dealing with legacy systems. Fortunately, with cloud based solutions and networking capabilities, retailers can build upon past technology investments as they move into the future. For instance, when looking at investments in security solutions, analytics that leverage data from traditional video, EAS and people counting systems provide valuable insights on system performance or targeted events. Additionally, incorporating machine learning and AI into solutions enables actionable and predictive insights – further improving the value of data, regardless of how or where the data was collected.
Step 3: Integrate or extend solutions for greater benefits
Connecting data from systems that have traditionally been in silos provides retailers yet another step in gaining a more holistic, precise view of their businesses. When a retailer has various technologies working together in an orchestrated way, new insights emerge. To convert shoppers into buyers, retailers must staff and assign tasks appropriately – but they also need to have the right merchandise available at the right place and time. Integrating store traffic and merchandise data enables retailers to anticipate shopper demand and create the perfect opportunity for shopper conversion. Another important way to increase benefits and ROI of technology is to layer on new use cases. RFID technology - typically used for inventory intelligence use cases - has a growing number of secondary use cases. Once RFID item-level inventory management programs are in place, retailers can add applications like smart exits to identify what’s been lost – or smart zone management to enable fast, accurate, real time inventory replenishment.
Ultimately, retailers can fast forward their store performance when they purposefully implement technologies that improve shopper experience. This begins by assessing each opportunity along the customer’s journey - now and in the future. Smart retail innovation is all in the details.
Kim Warne is VP and chief marketing officer of Sensormatic Solutions.