Retail Innovation: What the future holds for brick and mortar stores
Online shopping continues to disrupt the retail sector. While in-store sales still make up the majority of revenue for retailers, traditional brick and mortar stores have been struggling to keep up with the pace of change as more shoppers turn to the internet for their shopping trips.
However, new-technologies are beginning to now disrupt the online trend itself and improve the performance of physical stores. According to the 2017 World Economic Forum Report ‘Shaping the Future of Retail for Consumer Industries’, eight new technologies are expected to change the face of the retail landscape. Of these eight, the internet of things, artificial intelligence and robotics are expected to reach ‘full readiness’ within two to five years.
In order to compete with online sellers and improve sales, retailers are now increasingly looking to integrate these technologies into their operations. Image recognition, a form of artificial intelligence (AI), has already been adopted by big brands and retailers are now following suite.
This kind of technology works by capturing images of in-store shelves and uses advanced fine-grained recognition engines and proprietary deep learning algorithms to analyse them. This can provide a wealth of highly useful data on the performance of products, as well as offer recommendations for on-the-shelf actions, such as where a particular product should be placed or what promotional methods should be implemented.
Computer vision technologies are now increasingly being used by field reps and sales staff to provide highly accurate shelf insights, and as an alternative to manual store audits that can be both costly and prone to human error.
The internet of things (IoT) is invading every sector at a rate of knots and retail is no exception, with these technologies also beginning to provide real-time data for in-store execution.
An example of its use can be seen in cooler systems where IoT cameras, discretely placed behind fridge handles to face the contents, take an image every time a customer opens or closes the door. Images are automatically uploaded via internet-enabled connections and analysed remotely to provide real-time alerts for sales staff when certain products are out of stock, or if a particular brand is being stocked too often and taking the space of other products.
Similarly, robotics will play a crucial role in capturing data across the retail industry. Static cameras, fixed on top of mobile robotics platforms taking a full sweep of a store every 10-15 minutes within peak areas can provide constant data about shelf space, product placing and pricing data. This frees up sales staff to make corrections to pricing or spacing and improve product placement, which in turn will improve services to the customer.
Shelf space and the physical placement of products is a huge factor in drawing consumers into brick and mortar stores and plays a key part in influencing their purchasing decisions.
While ease of use and accessibility has coaxed consumers into shopping online in recent years, new innovations are beginning to make headway across the physical retail space and are giving retailers the tools to stay ahead of the game and make stores more profitable.
Neil Gowing, EMEA managing director of Trax