Connected Retail, unless you’re a professional working in the area of large distribution, that term probably doesn’t evoke much for you.
It’s a pity because it involves a whole revolution in the retail world and the way you will tomorrow buy products in your local supermarket.
Table of Contents
A Definition of Connected Retail
Connected Retail is already there but you didn’t notice it. For example, the “click and collect” features that some stores are offering is part of the Connected Retail program.
Connected Retail groups a set of practices, features, and technologies that allow closer interaction between clients and actors of the retail chain.
Typically, Connected Retail involves a fusion between online presence and physical presence in the store. The way customers can be identified in the store via all sorts of IoT devices: smartwatches and wearable devices in general but also smartphones, ipads, and tablets.
But Connected Retail also implies vast possibilities involving the companies working in the supply chain. For instance: ‘real-time’ gestion of the stocks, ‘real-time’ statistics of the product sold and trends. Automatic prediction of the products to buy, etc.
Connected retail is the ability for retail chains and brick-and-mortar stores to connect with their customers using personalized marketing and allowing the interaction of the physical store offering, therefore, a digital experience, special payment options and providing the employees of the supply chain to collaborate with each other and with the customers in a much more efficient way.
In other terms, Connected retail is the fusion of ‘online’ and ‘offline’ shopping.
In this article, we will try to give the reader a complete tour of the technologies which are making Connected Retail possible.
This Connected retail technology allows users to quietly select online goods from an internet store, remotely, and to buy them than to move to a brick-and-mortar shop and quickly collect the items.
That offer is very popular among customers since it reduces the risk of stolen or damaged goods and doesn’t have the inconvenience of waiting for a delivery at fixed hours.
There are also no shipping fees with Click-and-Collect, which is a big plus.
Customers can therefore quietly pick up their preferred goods via their computers or smartphones, for example at work or during transportation, and collect the goods very fast in one of the physical stores of the seller.
pickup boxes for Click-and-Collect
Big US retailers like Nordstrom and Walmart have implemented Click-and-Collect at a large scale and they see every year a rising trend of new Click-and-Collect customers. Walmart calls it Walmart curbside pickup.
Because of the actual pandemic with Covid-19, that shopping technique has simply skyrocketed.
Click-And-Collect involves more and more advanced robotic technology so that the process is fully automated. Pickup boxes are now being developed so that customers can directly pick their goods in a box, with the preservation of the cold chain.
Apex Supply Chain technologies are already proposing pickup lockers in the same spirit, except that customers would be able to own the key to the locker for a given period of time.
Next-day Delivery
Next-day delivery may be called the ‘Amazon prime effect’ and consists of systematically delivering the goods the ‘next day’ after which they have been ordered (and usually paid).
This is usually associated with Connected Retail because only Connected retail makes it possible to have an efficient next-day delivery system, without prohibitive fees.
Connected Retail Loyalty Schemes
Online shopping can be rewarded by bonuses and special offers in the brick-and-mortar shop (and vice-versa) through a Connected Retail loyalty program.
Retailers now have to adopt social media to increase sales of their physical stores.
For instance, Nordstrom is using a quite spectacular 3d visualization of their Instagram website for their customers to see posts in a ‘real-time’ way.
Other retail companies like Victoria’s Secret are asking customers to take selfies of them in the stores and posting them on social media so to get free products and bonuses.
So the interconnection of the digital presence of stores in social media is becoming interconnected with the physical presence of these stores in a way to impact the customer and get more sales.
In-Store Technology
In-Store technology in Connected retail is various:
Biometric technologies
Face recognition
3D screens/Holographic projections
Ai and self-learning programs
Computer Vision
IoT
Blockchain
Display Screens
A store needs a lot of screens to show their products to customers. With Connected retail the screen becomes 3D and interactive, allowing the customer to touch, to select, and to navigate in a virtual representation of the shop inside the real shop.
Shops become ‘Smart Shops’ with the presence of multiple interactive screens that can display AI agents dialoguing with customers.
Self-Checkout Kiosks allow the customer to Click-and-Collect directly in the store, without interaction with a vendor.
Usually, a huge screen will display products (hamburgers, fast-food products, etc), the customer will make a choice, pay, and collect the goods almost immediately. With such kiosks, especially popular in fast-food restaurants, there is no need to wait for a long time in a queue.
In-Store Communications
Stores are equipped with all sorts of communications: WiFi, BlueTooth, etc so that the customer can use their smartphone to get information for each product just by waving their phone around.
Additionally, in a mall, customers can get directions and information about each shop present in the mall directly on their smartphones or device, just by walking around in the mall.
Assisted Sales connects online and offline customer activity by allowing customers to shop offline what they have searched online and vice-versa.
For example, a customer may have searched in the online store for products not present and will be reminded later on (via email, SMS, etc,) that these products are available when he/she will be located in one of the retailer physical stores.
On another note, the Checkout Assisted Sales technology isn’t exactly a Connected Retail solution but can be seen as an effort of modernization of the relationship with the client.
The technology consists of detecting automatically unpaid products at the checkout via several techniques. This prevents any confrontation with customers via security agents and allows stores “to convert losses into sales”.
Connected Logistics and Supply Chain
Of course, maintaining a multichannel sales system – such as in Connected Retail – requires a very strong and efficient Supply chain.
Usually, this will involve robotic processes and robotic warehouses. Swisslog provides for example such systems and claims that they can even provide ‘same-hour delivery’.
Conclusions about Connected Retail
From Online Stores to Brick-and-Mortar
It is surprising maybe, that more and more online stores choose to create brick-and-mortar stores such as Amazon for example. Of course, such stores are naturally doing Connected Retail.
This means we will probably see in the next future a complete fusion of online stores and ‘offline’ stores (e.g. brick-and-mortar stores) and this involves fascinating challenges.
IoX vs IoT
Connected retail is often said to bring the debate between IoT – the Internet of Things – and IoX – the internet of Experiences.
In Connected retail, IoT provides a lot of new experiences to the customers but Connected Retail will clearly be developed in a way that IoX is optimal and so the user experience – and only it – will clearly dictate which sort of technology is to be used there.
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Vipin Nayar is the Digital Marketing Head at Acodez. As a Social Media, SEO & SEM expert with over 8 years' experience in online marketing, he uses his keen insight into customer behaviour to formulate innovative strategies that helps clients enhance their online presence & open up new business avenues.
