Feb 24, 2019The expansion of e-commerce in recent years has made many people bet on the end of physical retailing. But that didn't happen. Traditional stores are an important link in the chain of business for companies in the retail sector, representing a significant portion of sales and, especially, relationships between brands and the public.
On the other hand, we must also admit that the rise of new technologies has forced physical stores to change their strategies and structures. With consumers more connected and willing to look for experiences that fully satisfy them, and with the retail market more crowded than ever, retailers need to renew their service and management environments to efficiently follow the demands of the new digital age.
In this scenario, radio frequency identification (RFID) and the Internet of Things (IoT) are the main transformation pillars available to shopkeepers. By enabling the integration and automation of an entire business, from pre-sale to post-sales workflow, RFID and IoT solutions enable better business planning, both for simplifying business management demands and for optimizing business directly linked to the servicing of consumers.
Among the benefits generated from the use of sensors and systems connected to store structures, we can highlight the opportunity to monitor and analyze all of the events fundamental to a business's operation, anticipating any question that affects the results. For example, with a smart network, it is possible to propose high-quality predictive monitoring, with analysis capable of pointing out possible infrastructure and IT network failures, thus guaranteeing the maximum performance of the store in key moments of sales.
Another important gain brought on by the IoT is in relation to the intelligence required to manage internal assets, especially with regard to inventory control and logistics processes. The use of electronic tags with RFID chips allows for the digital tracking of products, potentially increasing the ability to analyze which items are being sold and which are being moved within stores.
In addition to operational advantages, IoT-connected systems tend to transform the interactive dynamics of establishments in ways that maximize the customer experience. Physical retailing will increasingly function as a showcase model, leveraging differentiated customer service to satisfy consumers. It is with this role that the market can become effectively able to serve customers who navigate the physical and digital environments on the same day of purchase. According to Delloite data, for example, 93 percent of customers claim to conduct virtual and real-time searches for their purchases.
Attending to this public will be possible thanks to the Internet of Things, since retail companies will have access to comprehensive information and will thus know what consumers' real expectations and needs are. They can practically measure which products are most sought after, what forms of interaction and contact are most assertive, and what kinds of services should be delivered—whether for sale at online channels or for order completion in-store.
By using the latest technologies in their aisles and display cases (with wireless networks, digital displays and self-service tools, for example), organizations can gain options to create a more attractive and complete condition for their consumers, who will thus be able to test products on time.
In summary, this means that technology—and the IoT in particular—can help retailers to reinforce the omnichannel positioning of their companies, making the physical space of their stores a more connected and integrated environment to the experience offered by digital channels. There are already several solutions that integrate IoT hardware, software, services and devices to modernize stores and intelligently collect information regarding consumption and customer interest.
Effective management of these technological solutions allows retailers to create environments for consumers to have ever-changing digital experiences, while analyzing consumer habits and predicting preferences. For example, they can deploy sensors on shelves to measure handling and the amount of time workers spend with consumers in each sector of the store.
But success in using these applications and innovations depends on a number of factors, such as training and qualifying teams, as well as reliable point-of-sale support. For tools to actually work, a retailer must simplify employee routines and, most importantly, add value to the consumer relationship with services offered by the store.
With the fierce competition for customer attention being increasingly vital to achieve a return on investment, it is important for companies to deploy RFID and IoT technologies, and to ensure that these solutions continue to be effectively useful to everyone, by automating day-to-day processes and allowing sales success, regardless of the channel used for purchases. Smart devices are here to stay, and they contribute to business results. It is up to retailers to define the strategies of IoT use in order to offer customers the best shopping hours, avoid losses and boost sales.
Sandra Maura is the CEO of Topmind.