From computer vision to AI, the retail tech landscape has evolved far beyond the “mom-and-pop” shops of yesteryear
Christmas 1996 came with a different energy. During the biggest holiday shopping craze since the Cabbage Patch Kid frenzy of 1983, Tyco’s Tickle Me Elmo left parents, grandparents, and resellers in a frenzy that spawned epic fights and trampling to get their hands on the vibrating red monster. Footage of the overzealous customers seems satirical today, as retail technology has advanced so much that many shoppers barely leave the comfort of their couch to snag the latest must-have item.
Shopping from an app isn’t the only shift we’ve seen over the past few years. Retailers are embracing change thanks to advancements in digital and automated retail technologies alongside the possibilities of 5G.
How technology is changing the retail environment
During the pandemic, most consumers pivoted their shopping behavior to support new online-driven fulfillment options such as “buy online pickup in-store” (BOPIS) and curbside pickup. For many, the convenience of skipping lines and accessing product information and availability from their fingertips was revolutionary, and this shopping behavior has driven many of today’s changes in the retail tech landscape.
Although convenience from anywhere is a high priority, retailers are looking for ways to encourage customers to return to stores. However, they are met with labor shortage challenges and ongoing loss prevention hurdles that only seem to worsen. Retail technology is helping big box stores, boutiques, and everything in between combat these issues by:
- Implementing new digital management systems that utilize analytics and AI to provide accurate inventory views, placement recommendations, and insight to maximize stock turns.
- Exploring uses for mobile devices outside of mobile point-of-sale (POS), such as arming associates with quick access to inventory and product information.
- Pursuing new self-checkout technologies that include radio frequency identification (RFID), which can improve customer checkout satisfaction and create opportunities for interactive experiences.
- Installing cameras with computer vision — a technology gaining a lot of steam thanks to its multi-use platform. This technology can be layered with AI to recognize things such as dwelling in a certain area and then proactively sending someone to help. This can turn into upsell opportunities and prevent frustrated customers from leaving.
Focusing not only on the customer experience, retailers are also seeking ways to make social and environmental impacts through technology. For example, in 2022 Macy’s announced an initiative called “Mission Every One,” created in part to reduce waste from physical samples. In 2019, 5% of the samples reviewed by Macy’s each year for potential product launches were digital. By the end of 2020, 61% of the samples were reviewed virtually, significantly reducing waste going into landfills.
Hurdles of adopting new technology in retail
It’s exciting to examine how technology is altering the retail experience, but no advancement or innovation occurs without a few bumps in the road.
Integration with legacy technologies
Few retailers are incorporating new technologies on a completely blank slate. IoT in retail and other modern upgrades are typically forced to integrate with legacy technologies. Often, these disparate technologies have a difficult time talking to one another. When technology portfolios still rely on traditional resources such as “hub and spoke” network models or dynamic multipoint VPN (DMVPN), it’s important to examine new, all-in-one models that can futureproof a network while keeping its assets safe.
As retail technology advances, consumers want things faster. This means retailers are at significant risk of losing business when a network slows down or goes down. Shops and stores must be mindful of their wide-area network (WAN) stability and be proactive in establishing a hybrid WAN model that allows them to maintain constant uptime by adding a 5G or LTE failover link. Sometimes, using 5G for primary WAN connectivity may serve the location better than its wired alternatives.
5G in retail is a springboard for innovation — it stabilizes the network and is robust enough to support applications such as customer Wi-Fi, pop-up locations, kiosks, and IoT.
Deployment and management
When retailers have hundreds or even thousands of sprawling locations, it can become unwieldy for IT teams to deploy, manage, troubleshoot, and scale, while being mindful of various network layouts and compliance requirements. In most cases, this can only be accomplished through a cloud management platform, allowing IT teams to view all connections and network health through a single pane of glass.
When deploying new retail technologies, it’s essential to consider the experience of the store associates — an area that is often overlooked. If employees experience friction with the technology, customers will, too, making it imperative to evaluate the best technology for each use case. Inserting new technologies into retail environments is usually done on a small scale, giving the retailer time to adjust and make tweaks before expanding.
The role of security in retail technology
Loyalty programs, BOPIS, in-store applications, IoT, and payment systems — each of these technologies comes with an inherent collection of customer data. So, how can retailers proactively address the security and privacy concerns bound to surface? A simple solution is to ensure that if a bad actor gains access to any part of the network, their movement is restricted under the tenets of a zero trust strategy.
Zero trust architecture protects the retail network by only connecting users to specific resources and verifying them constantly. This “never trust; always verify” approach to access can be built upon using Zero Trust Network Access (ZTNA), which establishes isolated connections for third-party users, contractors, and other employees needing access to specific resources.
All these granular policies can be applied and monitored from anywhere using a unified platform that keeps things simple for IT teams. That said, most security issues occur due to human error, making workforce development programs and staff education imperative, especially in a retail environment where many people are touching the systems and data.
Addressing retail tech’s ‘elephant in the room’
As the economy slows, it’s more important for retailers to seek out technologies that can be leveraged across multiple use cases and business units. Doing so gives them a much higher chance to achieve an ROI, creating more potential to innovate.
AI is being included in new use cases and will continue to gain more power and compute capabilities that allow retailers to analyze data and create content to inform how they interact with their customers. RFID — although not brand new — is evolving. Its costs are decreasing, which helps expand the number of use cases. With these advancements in retail technology alongside the growth of IoT in retail, some employees find themselves asking, “Are robots going to take our jobs?”
Breathe easy — the answer is no. As employees continue to learn skills to support these new technologies, there will be a place for them in retail. Moreover, by taking up such mundane tasks as data input or price tag changes, employees are relieved of highly repetitive, time-consuming tasks, giving them more opportunities to serve customers in new ways that lead to both customer and job satisfaction.