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What Will Happen to Retail Spaces that Fail to Adapt to IoT

Physical stores are changing (again) so why and how should the retail industry be trying to keep up?

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When online shopping took off, physical retail spaces were under pressure to adapt. Now the second wave of industry revolution is underway, except this time it’s focused on how retail stores can become connected spaces.

Let us explain what we mean by that. Right now, you go into a retail store and the journey is not actually that different to the same one we’ve had for decades, in that you choose your items, pick them up and pay a staff member at a counter.

Pain points such as queue times, POS positioning and item inventory largely still exist. If you’re lucky and a regular, perhaps the store assistant knows your name. If you aren’t and it’s rush hour, you could be in for a long, faceless wait. 

In terms of merchandise and product, store decisions are either made on the manager's gut or on data from sales and CRM systems, which can be painfully slow to trickle down. 

So what if there was a better way? 

IoT-enabled Connected Store Spaces

Imagine if company A makes its store decisions on a gut feel for business, whereas company B makes decisions using IoT (the internet of things) enabled data. Who would be more successful? Sure, a small business could ask its customers what they want. But as soon as you want to expand and grow into new audiences, the store would have to evolve in order to succeed. 
Not only that, but stores need to be continually evolving the experience of the store space in order to get buy in from customers. In fact - some studies state experience as more important to consumers than products on sale.

If a customer can enter a store, see personalized digital signage, read smart product tags which change and adapt to store deals and could even scan, pay for and remove items without needing any assistance from store staff how much more enjoyable would this experience be? Take Amazon Go, where customers simply take what they want and get charged directly to their Amazon account without having to queue up or even take out a wallet. 

Store-side, you’d have the richest data available, that makes itself known as soon as a shopper enters the store. Facial recognition may be a way off, but sensors and beacons which recognize customers by their smartphone, are feasible in today’s connected store. Surveillance monitoring of queue times, fluctuations in customer number and even staff tracking, could help stores adapt and react much more quickly in peak periods. For example opening more queue banks, or adapting break rotas automatically to account for additional footfall. 

In the connected space, the internet not only enhances the experience, but it also removes pain points. Queues at checkout and struggles to find a specific item or store staff member are reduced or eradicated with self-service, self-scanning, robotics, digital wayfinding and smart products. 

In the smart store of the future, customers and experience, rather than products and process, become the focal point. 

The application of the physical connected store

Some of the adaptations of the smart connected retail store include:

Consumer triggers: mobile-led initiatives using beacons, apps and smartphones that allow smart stores to pull customers in through geo-fencing and highly targeted adverts and offer codes. 

Data and personalization: digital screens, sensors and tracking networks which monitor a shopper, or multiple shoppers’ behavior around a store. This data feeds the personalization of products, experiences, offers, store help and advertising placement, based on previous behavior and shopper preferences.

Digital signage: smart screen displays which use data to personalize content, based on shopper interests, time of day, weather outside, season and more. Integrating the ‘internet experience’ in-store, with interactive displays, social media engagement, wayfinding, directories and native advertising content. 

Store upkeep and merchandising: smart stores that contain fridges or product banks that automatically replenish based on product sales. Sales counters that renegotiate merchandise displays based on time of day, product sales and customer behavior. RFID tracking of inventory that allows stores to react more quickly, hold less stock, and be in a far better position to supply product to customer.

Security: connectivity that allows stores to better monitor security out of hours using sensors, facial recognition and internet-enabled alarming. 

Robotics and AI: robotic store staff, checkout systems and changing room assistants. Machine-led product placement, stock inventory and product ordering systems. 

Failure to adapt to the connected store space

There may come a time when we long for the high street of the past, one where our every move isn’t monitored and adapted to. Yet to achieve growth and reach potential, the IoT-enabled smart store seems inevitable and essential, if retail stores are to compete. 

Ten years ago, stores were being forced to adopt mass digitization of their businesses, through ecommerce and social media. If all had adhered, Blockbuster video would be where we watched our latest TV series and Kodak would be where we took, edited and shared our images online. In both cases, it’s easy to see how easily retail can flounder when it doesn’t understand the technologies the rest of the world are adopting.

Before long our homes will probably be smarter than most retail stores - heck, our cars already are. 

Which leads to the question; what will happen to retail stores that fail to adapt to the connected space? It seems fair to say that we’ll see the demise of a fair few more of our high street stores before the IoT-enabled era is out. 

Discover ScreenCloud’s ability to help retail adopt digital signage displays with IoT-led solutions.

 SC Gradient

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