The retail industry is in the midst of a technological revolution.
Connected devices and mobile payment systems make it easier to monitor and improve retail processes. They have the potential to further liberate the entire shopping experience with next-generation retail spaces like the Amazon Go, fulfilling the shopper’s need for agility.
These are just a couple of examples, but there are many others. For manufacturers and distributors, big data transform how they manage their vast supply chains, enabling them to extract more shopper insights, and help them optimize their processes. The challenge of channeling products through numerous distribution networks is becoming more manageable. Even with most packages still being delivered by hand, for example, drones seem on the verge of solving last-mile-delivery problems.
New retail technologies will continue to create a forward-thinking and seamless experience for shoppers, retailers, and manufacturers. This is why we, at Planorama, want to take an in-depth look at a few of these new technologies and understand their current and future roles in retail. This is the first blog post in a series of three articles, where we will get an overview of those breakthroughs.
To start with, let’s look at one of the most promising next-generation retail technologies: smart shelves.
The Benefits of Smart Shelves for the Retail Industry
We know that online shopping has transformed the shopper’s expectations because it’s rare for an online store to run out of stock. But did you realize that even when shoppers visit a physical store, they carry this availability expectation with them? This makes it even more disappointing for a shopper when an item is physically unavailable.
The challenge for retailers is that maintaining fully replenished shelves requires a constant surplus of products at hand, which is inefficient and costly, even with a lot of storage space. Smart shelves offer a solution avoiding stock outs, which are the primary concern of 25% of retailer CEOs, according to a study by PWC (CEO viewpoint 2017: the transformation of retail).
Smart shelving units - such as refrigerators, store shelves, and so on - are enhanced with sophisticated sensors that automatically check the stock, identify patterns in supply and demand, and generate an alert for replenishment when necessary. Rather than carrying too many products or too few of them, retailers have precisely the quantity they need at all times. Eliminating OOS in retail is just one of the advantages of smart shelves, though. On top of that, it’s also easy to help locate misplaced items. Managing inventory requires less employee involvement while becoming more efficient at serving the shopper. For instance, WiseShelf adds colored LEDs to the shelves to quickly identify different sections of the planogram when they are being filled. Each color is assigned to one product, so the employee knows exactly where to put which products without having to check the planogram. This means faster and smoother shelving, improving the employee’ productivity and better inventory management overall.
Camera-enabled smart shelves can also take pictures of the aisle in real time. Together with an image recognition solution such as PlanoCheck, these photos can be analyzed to identify further performance gaps and translate them into actions. So, manufacturers and retailers can further act towards improving inventory management and preventing lost sales with smart shelves. Instead of getting partial snapshots of the store reality with in-store data collection – i.e., analyzing stocks and delivering KPIs in a given display only when the field sales rep visits the store, we’re seeing image recognition and smart shelf technologies provide continuous real-time insights.
Such insights offer both manufacturers and retailers ample and invaluable opportunities for improving performance at the point of sale.
The Future of the In-Store Experience
The advantages of smart shelf solutions are amplified when this technology is integrated with other new in-store technologies, as we believe it will continue to shape the future of retail. For instance, smart shelves, shopping carts, and payment technologies could be combined to eliminate the checkout line. Shoppers could merely take items off a shelf, put them in their baskets, and walk out of the store while payment is automatically processed.
Smart shelves also have many exciting applications when integrated with digital shelf displays and other forms of interactive advertising. When demand for a specific product is low at certain times of the year — like with holiday or seasonal products — displays could broadcast special offers to accelerate consumer demand.
By combining smart shelf solutions with interactive display technologies, retailers can take action on the shelf at any time and reach the shopper. Anything is now possible, from changing product prices in a matter of seconds rather than hours, to immediately updating product information such as nutrition, to increasing instances of impulse buying and cross-selling. As part of their relationship with the retailer, manufacturers can benefit from more accurate and granular data and can identify new promotional and placement opportunities, as well as improve their sales forces’ recommendations to the stores.
By relying on smart shelves, both manufacturers and retailers can monitor stock with more depth and sophistication, and process literally every data available and translate it to real-time insights.
We’ll continue to track these breakthrough technologies in the next blog article of the “Retail Tech Breakthroughs” series. Stay tuned!
To combine the power of smart shelves and image recognition, you can discover our PlanoCheck solution and request a demo with us.
Topics: retail execution