Digital Transformation in Retail

Robert Ilijason created this unique shopping reality. Shoppers manage every aspect of shopping themselves using a simple smartphone app: they register as customer, slide to open the store door, scan products and pay digitally. Robert’s store is a nice example of how combining strategy and technology leads to Digital Transformation.

Technology is set to change the retail sector in many ways. Some examples:

The combination of GeoFencing and Mobile Apps enables consumers to create digital shopping lists. When you drive near the supermarket, your smartphone will remind you of the list. Once inside the supermarket, the App will quickly take you to your items using InStore route planning.

In Store cameras can track shoppers. When a shopper spends longer than 3 minutes looking at the same rack/item, chances are he has a question. The system can automatically dispatch an employee to advise the prospective buyer in a personal way.

Cameras help to create charts and an understanding of the traffic in the store. Retailers can optimize store layout by analyzing and correlating this traffic with rack plans. This results in increased sales and enables retailers to better identify premium shelf locations and sell these at higher prices to suppliers.

Using translucent LCD-technology additional data and special deals can be overlaid on refrigerators. Shoppers can view right through the LCD, see the product, and at the same time take in the additional information on the screen. TLCD is set to raise mall windows from transparent plates to active tools of communication and marketing.

Big data will have a major impact. Via “Sentiment Analysis”, “What’s Trending” on Tweets and other social media, retailers know in real time what is happening and hip (near their store). Imagine stores, much like factories in Industry 4.0, dynamically adapt to changing context: dynamically changing window information, continuously improving product shelf placement …

Big data will be combined with Artificial Intelligence to create valuable consumer profiles. Because if a consumer buys diapers 3 times in a row, then he has probably welcomed a baby into his family. And so the retailer knows mom and dad will be needing many more diapers. This enables the retailer to lower the price at which he buys diapers, because he buys larger volumes. Artificial Intelligencetracks the evolution from baby to toddler and beyond, ensure right product promotions and purchasing efficiencies for both retailer and consumer.

Big technology players are increasingly getting (deeper) into retail innovation. Amazon has introduced dash buttons: clickers the size of a USB stick. Just press the button when you are out of coffee, and a refill will be delivered to your door before you wake up tomorrow morning.

Apple is proposing new payment options. And from open source come incredible innovations like Openbazaar: a full peer-2-peer marketplace based on concepts that underlie the likes of BlockChain, BitCoin and Ethereum. Marketplaces like Openbazaar can largely eliminate the need for e-commerce  websites.

Already today retailers are confronted with well-informed consumers that step into stores, smartphone in hand, wanting even more information and advice. The back office systems of the retailers and their suppliers typically store a lot of this valuable information. But then the store employee needs quick and easy access to this information. Via an intranet, a mobile App, a chatbot, …                        

Revolution in retail is coming and to stand still is to backslide.