How Some Retailers Are Seeing Value in IoT and RAIN RFID
According to this report from Retail Systems Research, some retailers are winning the game. IoT adoption is helping. How?
Just as they have for the past four years, Retail Systems Research (RSR) released their benchmark report, entitled The Internet of Things: Finally Finding A Home In Retail? This report evaluated attitudes regarding the business value of Internet of Things (IoT) technologies from the perspective of retailers.
While the research for this benchmark report was conducted prior to the rise of COVID-19, the evaluation of priority IoT capabilities is still noteworthy and relevant as retail reemerges. The retail group surveyed, in particular, saw specific IoT opportunities across core operations—especially in store—to track customer flow, improve operational efficiencies, and perhaps most importantly, help their companies improve inventory management.
IoT capabilities can support critical operations and enable needed abilities as retail pivots post COVID-19. Retailers will need to provide a safe and comfortable shopping environment to make customers feel confident in shopping in store again. It will be important for retailers to limit the number of shoppers in their stores to provide distancing to reduce risk while shopping. IoT technologies can assist with this by monitoring the store traffic as people enter and exit the store.
In short, IoT technologies can provide different capabilities and tools that will be instrumental in transitioning retail in a post-COVID-19 world. While some of these capabilities—like counting in-store customers—are only now emerging as important, some retailers have already been embracing IoT technology for other reasons.
Who is leading the charge?
Some retail leaders are already harnessing the power of IoT technology to improve the customer experience and enable accurate inventory visibility. RSR found overall that leading companies, or the ‘retail winners’, are effective at picking the right success metrics, listening to their IT departments, and accurately anticipating what customers would find valuable.
We’ve already seen that Retail Winners have a different outlook on IoT’s ability to help them manage inventory, improve wait times, track shoppers’ dwell times, and successfully execute omni-channel retail. In fact, in all of our benchmark reports, RSR quite frequently cites differences between these retailer over-performers in year-over-year comparable sales and their competitors. We find that consistent sales performance is an outcome of a differentiating set of thought processes, strategies and tactics.
So what did retail winners rate as priority high value IoT-supported capabilities?
- Tracking customer flow nearby the store - 89%
- Better inventory management across the enterprise - 74%
- Systematic supply chain cost optimization- 66%
While everyone polled answered that they were excited about the potential use for customer focus in IoT, they also recognized the need to achieve speed and agility in their operations as a way of achieving that focus. Most retailers are likely to understand the connection between accurate inventory visibility and delivering on the promise of customer service—particularly because of omni-channel.
With the closing of retail stores over the past few months, retailers have found ways to still meet customer demand during this trying time. Omni-channel with store fulfillment has offered customers new ways to purchase goods and experience buy-online pick-up instore (BOPIS) and curbside pick-up (BOPAC). With positive experiences in this new way of shopping, it’s probable that this will continue to trend as stores reopen and customers want to keep some distance. RAIN RFID, as an IoT technology, is a key enabler of these new operations. It can connect products, people and places, to provide accurate inventory visibility into items wherever they may be. Through IoT, retailers can access the items and get them into the hands of the shoppers when and wherever they are, at home, in store or at the curb.
IoT technologies can easily automate processes along the supply change and all the way through point of sale to the customer. Systematic optimization with the aid of RAIN RFID technology will limit touch along the way driving efficiencies and lowering costs. Retail leaders, foresaw value in IoT capability—and they still do:
Retail Winners ascribe higher value to virtually every current IoT capability we put before them: from interacting with customers outside the store to tracking their activities once nearby - all the way into the myriad ways they can improve shoppers’ experiences once within the store’s four walls. inventory management, improved wait times, the ability to track shoppers’ dwell times – all are in play.
As the report elaborates on, retail leaders have capitalized on the capabilities of IoT to engage with customers. Their adoption of IoT is an optimistic preview of how IoT may have a wider adoption in the future, resulting in more engaging shopping.
One area where IoT is particularly developed already? RAIN RFID.
While many of the expectations for IoT future performance are both high and abstract, RAIN RFID is one of the only areas currently adding to a company's ROI. Rightfully so, many are focused on the promise of IoT with a customer-centric focus. Inventory accuracy and visibility, as the first use case and primary value-driver, is helping retailers succeed with omni-channel, and develop new store fulfillment capabilities like BOPIS and BOPAC.
Retailers have to deliver on the high expectations of their customers, especially now, to bring them back to the store. There is a small window of opportunity to prove the potential of IoT with shoppers and retail company stakeholders. As the RSR report puts it, this is not the time for over-promising on behalf of new technology.
Whether it’s correlation or causation, trusting your IT department has some connection with high growth. Leading companies pay attention to their IT department, and incidentally, 81% of the IT leaders polled rated RAIN RFID as the #1 high value IoT technology for the report.
IoT can drive real and substantial benefits to the retail enterprise, both in managing inventory and in connecting with consumers. But basics must be covered, and ROI generating quick wins must happen before senior management is going to sign off on significant investments.
Don’t ignore easy solutions. RAIN RFID is a good introduction to IoT, with a quick and measurable ROI. Getting IoT embedded into inventory management is an excellent gateway to further IoT investment.
Want more actionable advice and insight? Download the full report here.
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Thursday, May 28, 2020