With the holiday shopping season just around the corner, the pressure is on for retailers and their bottom line to meet customer expectations and hit company goals. Experts estimate that the holiday season represents anywhere between 20%-30% of the annual revenue causing retailers to hire north of 500,000 temporary workers in order to accommodate the shopping rush. With the rise of technological innovations, digital retailers continue to see year over year growth, forecasting retail commerce will amount for about 10% of retail spending across all merchants in the U.S. However, that is about one-eighth size of brick-and-mortar retail, simply meaning holiday shoppers continue to purchase products and goods in-store. While this is promising for brick and mortar, retailers face pressure to complement the efficiency and value that ecommerce provides.
Retailers are looking to innovative, digital use cases, like ‘smart shelving’, to support the needs of customers and employees. Smart shelves utilize built-in weight sensors and RFID tags that notify back-of-house operations with real-time shelf inventory tracking and analytics, making restocking more efficient than ever before. When products are not in the correct location, smart shelves notify retailers on the misplaced items, allowing employees to resolve the issue before customers search for desired products. It also allows retailers to give a stock availability assessment by providing information on items that are running low and giving retailers the opportunity to sell similar products to customers if items are no longer in stock. Smart Shelf by AWM is bringing the efficiency of an online shopping experience into the physical retail landscape, with clients such as Pepsi, Walmart, and Albertsons taking advantage of the real-time technology. Using the Smart Shelf mobile application, shoppers can locate the specific locations of products in a matter of seconds. By allowing retailers to track what’s on their shelf, they are not only prepared for the arrival of customers, but the engaging and efficient technology enhances the overall in-store shopping experience.
Much like the innovative smart shelving, real-time pricing is saving both retailers and consumers’ time through technology solutions. Real-time pricing leverages mobile applications making it easier for stores to manage and adjust their in-store prices through personalized offers and post transaction settlements. Retailers are constantly trying to keep up with their rapidly changing prices on a weekly, daily, or hourly basis, especially during the chaotic holiday season. While Gartner predicts that retailers will use real-time pricing by 2025, Walmart offers a similar function with Savings Catching, a customer-facing mobile application giving access to receipts and post transaction edits. If a customer is accidentally charged more than what is advertised, the mobile option allows the chance for the customer to receive money back in the form of a virtual gift card. By adjusting pricing through technology and allowing full purchase visibility for customers, real-time pricing grants employees more time to assist customers on the floor and less time spent resolving conflicts.
In addition to the introduction of new innovations, retailers are looking to update management systems, like Distributed Order Management, that delivers a seamless customer experience during the hustle and bustle of the holiday season. Unlike the traditional order management systems (OMS) that connects single channels to inventory sources, Distributed Order Management (DOM) does not place a limit on the amount of inventory that is visible within the supply chain. More specifically, the cloud-based DOM is an ecommerce engine that provides solutions for managing the excess of information over the network and ensuring customer orders are fulfilled accurately. According to the 2013 RIS News/Gartner Retail Technology Study, “just 20% of retailer respondents are using up-to-date technology for real-time inventory visibility, 24% for distributed order management and 16% for multi-channel fulfillment. The majority agree that the goal is to migrate to a single, flexible platform capable of managing the overall business.” DOM platforms allows retailers to have a complete view of the supply chain, giving them more control over management, ensuring orders are processed correctly, and providing a real-time view of the product in transit.
To ensure customers receive a convenient in-store shopping experience, retailers are looking to implement real-time IoT to inform consumers on their purchases and gather data based on preferences. Real-Time IoT is an emerging technology, encompassing The Internet of Things; a network of devices that has the capability to collect and exchange data. IoT has seen recent growth, as more than 12 billion devices are already connected to the Internet of Things, with the number possibly jumping to 30 billion by 2020. Retailers such as Sephora, a leading store in personal care and beauty, leverage IoT technology to create an interactive online gallery called Beauty Board, allowing customers to scroll through images of real people wearing the products and then buy the look that best suits them. Real-Time IoT is on the rise with its ability to keep up with the fluctuating demands of customers, especially during the holiday season when buyers conduct extensive research prior to making any major purchase decisions. Smart stores are using other forms of IoT technology known as micro-location, to recognize returning customers, enabling retailers to send coupons and other incentives as customers peruse the store. With solutions like real-time IoT, retail stores can offer customers an engaging, personalized experience that drives sales and helps drive repeat visits.
Rounding out digital retail trends for this holiday season is computer vision which allows retailers to act based on the understanding of images. The technology receives an image, processes an image, and from there classifies the image. “Computer vision is concerned with the theory and technology for building artificial systems that obtain information from images or multidimensional data.” Computer vision can be found in facial recognition, cashier-less stores, inventory visibility, and visual search. Amazon has implemented computer vision solutions with Amazon Go Stores, removing the need for POS systems. Customers simply download the Amazon Go app while multiple in-store cameras and store shelves aligned with weight sensors detect the items consumers take and automatically add them to the virtual cart. The customer experience has never been so hassle-free, as computer vision removes the long line, improves store security, and speeds up business operations – all of which is essential during the holiday season.
In the era of digital transformation, brick and mortar stores continue to hold an important role in the overarching retail strategy. Many customers appreciate a seamless in-store experience that allows them to pick out and try on products, while still having access to high tech solutions. During this holiday season, keep a lookout for how retailers are integrating emerging technologies into their stores, which aim to provide a meaningful experience and a stronger connection between the brand and the customer.
To learn about the latest, personalized technologies offered by Extreme Networks, be sure to visit our Retail landing page.
This blog post was co-written by Ashley Iannuzzi, Vertical Marketing Solution Co-Op at Extreme Networks.
