In the Store: Retail Innovation with a Purpose
Many innovations have disrupted the retail industry in the past 20 years, starting with the introduction of the Internet and e-commerce and quickly followed by the smart phone. New ways for consumers to engage with brands have reshaped the core of a retailer’s business — from labor to inventory and fulfillment — ultimately impacting the overall shopping experience. As the retail industry has adapted to the new normal, it has shined the spotlight on what would happen to the future of physical stores.
There has never been a time when technology has been more critical to retail performance than it is today. Technology is enabling omnichannel strategies, providing supply chain visibility and changing how retailers connect with consumers through social media and other digital channels. According to a forecast from Gartner, global retail sector technology spending is expected to grow 3.6 percent to reach almost $203.6 billion in 2019 — a major increase for the industry.
While online and mobile are still integral components in the modern consumer’s shopping journey, a majority of retail capital investments are now being allocated to store networks. Making smart technology investments can deliver tremendous value to retail stores, to optimize staffing, increase inventory turns, enable secure frictionless transactions, and to empower store associates to become effective brand ambassadors. To achieve strong store performance now and in the future, retailers must operate seamlessly and efficiently while delivering unique, differentiated brand experiences. The right technology investments can help retailers reach both of these goals simultaneously.
Starting with the basics: optimizing store performance
Retailers might be surprised to see how making small changes in their operations can drive significant impact. Extracting value from technology is not a “one-size-fits-all” exercise, and going back to the basics can help retailers tailor their approach to their own unique challenges and environments. A good first step in achieving optimal store performance is to identify operational improvements that will impact their store today. Robots and drones can help automate functions, but technologies that can help a shopper more quickly find the red blouse she’s been searching for will result in stronger sales conversion and greater shopper loyalty.
By identifying the main business areas that have the maximum effect on the customer experience, retailers can determine where additional connected technologies can best assist them in their business model. Core retail competencies such as understanding the consumer path to purchase and conversion, gaining an accurate view of inventory across the enterprise, and optimizing and empowering labor are three ways to drive exponential improvements in store performance through more intelligent deployment of technology.
Leveraging your investment: new insights through connectivity
Insights into store traffic patterns are key to understanding the path to purchase and conversion. Smart loss prevention solutions deliver real-time insights to help retailers make effective data-driven decisions that may positively impact shrink and bottom line results. Inventory intelligence solutions help retailers gain item-level visibility into accurate and timely inventory across the enterprise. Combining data across these solutions can create even more value as the adoption of data analytics and smart, connected devices can provide retailers a more holistic, precise view of their business.
With a consolidated view, retailers can better understand peak shopping hours and combine those insights with inventory visibility to identify when shelves may need to be restocked. This holistic approach can also help align staffing decisions with times where there is an increase in sales and conversion, along with the potential loss events due to heavy foot traffic. When different business areas work in tandem with each another, retailers can better ensure that the shopper who was looking for the red blouse not only finds the blouse faster than before, but also that the experience builds loyalty for repeat visits.
Decisive transformation: redefining purpose
Significant transformation to sharpen customer focus and innovation with purpose are required to successfully move into the world of “New Retail.” Ultimately, retailers must have the right information available at the right time for the right customers and associates, and are looking to technology to make this vision a reality. Retailers can fast forward their store performance when they stop to assess their operations and purposefully invest in solutions that improve the most critical elements of the shopper experience. Retailers that embrace change with meaningful innovation will solve unmet customer needs and thrive in the digital age — today and in the future.
Kim Warne is Vice President and Chief Marketing Officer of Sensormatic Solutions.