RFID in Retail at a Glance
What is RFID?
RFID (Radio Frequency Identification) uses radio waves to track and identify tags attached to objects. The tags contain electronically stored information and are counted or ‘read’ by either handheld or fixed RFID readers.
How is RFID used in Retail?
In many ways RFID is used in retail as an alternative to a barcode system (although it doesn’t have to replace barcodes entirely). The more advanced technology involved in RFID mean it has a far greater level of accuracy and efficiency when it comes to counting inventory. As a result of this it has far broader applications in retail, most of which are built of off the back of this reliable inventory visibility.
What is the financial benefit of RFID for retailers?
By implementing RFID retailers can on average increase their revenue from 5-15% depending on the business. This on top of a margin increase of up to 1% and 10-15% lower working capital due to optimised inventory levels.
How common is RFID in Retail?
According to research in 2018, 69% of retailers cite a significant level of adoption, and this number is continuing to rise.
The 6 Key Benefits of RFID in Retail
Due to the ease and accuracy of RFID stock counts, retailers using the technology can reliably achieve full item-level inventory visibility across their stores and supply chains. Crucially, due to the speed of RFID inventory counts, this can be achieved whilst actively reducing the labour intensity of operational processes. This accurate and up-to-the-minute inventory information is the backbone of so many of RFID’s uses in retail (including many of the points discussed below).
One crucial aspect of modern retail that relies on having accurate inventory visibility is Omnichannel retailing. With a complete and up-to-date view of stock across all channels, it is possible to open up the inventory of your entire store network to customers, providing a better customer experience and increasing sales.
Benefits of item-level inventory visibility
- Improved shipping accuracy
- Excellent baseline for advanced omnichannel retailing
- Produces more data for better insights
- Reduces inventory size (and therefore working capital) significantly
- Increased customer satisfaction from reduced out-of-stocks and a more connected experience
Increasing Product Availability
Ensuring a high product availability is vital to maintaining retail sales. Despite this, low on-floor product availability and out-of-stocks are an alarmingly common problem in the industry, causing unnecessary lost sales as a result of inefficient replenishment processes and stock inaccuracy. This latter cause is practically removed completely by RFID, with typical stock accuracy being increased to 99% from the standard 60-80%.
Additionally, RFID platforms provide an unbeatable basis for efficient and reliable replenishment processes. The main advantage these platforms have is the item-level and real-time inventory visibility gained from regular 99% accuracy stock counts.
How does RFID increase product availability?
- Makes regular cycle counts possible with efficient RFID stock reads
- Removes stock inaccuracy (from 70-80% to 99%)
- Creates complete item-level view of stock between both backroom and sales floor
- Item visibility makes replenishment easier and more accurate
- Real-time view allows for replenishment alerts for when items/sizes are running low
- Item-level data from RFID allows for advanced, even AI-assisted planograms for individual stores
Supply Chain Traceability
We’ve discussed the difference item-level visibility makes for stores, but when it comes to supply chains the benefits are just as great. With RFID, inbound and outbound reads become far easier, and are done on an individual item level rather than SKU (stock keeping unit). This means each item is accounted for at each step of the supply chain, rather than just shipments or boxes.
This level of stock visibility also drastically reduces the rate of shipping errors or picking mistakes as they are detected by RFID readers and corrected by warehouse staff during exception handling or outbound reads.
Additionally, the location or status of items and shipments are visible in real-time, so stores and DC’s can easily track shipments and know exactly what they will be receiving. This makes any individual item fully traceable, as time and dates of when the item passed each read point in the supply process can be stored.
Benefits of RFID in the supply chain:
- Item-level visibility across entire supply chain
- Trace items against individual shipments
- Smoother operational processes
- Track shipments for delivery
- 100% inbound and outbound shipping accuracy
Increasing Process Efficiency
The difference in process efficiency from using RFID in retail is extensive, at every end of retail, be it the factory or the shop floor. An RFID reader, regardless of whether its fixed or a handheld, can read hundreds of individual items at once. Crucially though, as each item has a unique ID, they can never be read more than once. The signals also do not require line of sight to be read.
Naturally, this makes RFID inventory counts and inbound/outbound checks incredibly fast and reliable. In the case of store inventories, RFID has been found to reduce cycle count times by a staggering 96%. This therefore means they are far more convenient to perform and can be done multiple times in a week rather than a year.
Processes transformed by RFID:
- Cycle counts/inventories
- Fast & Efficient Inbound & Outbound reads
- RFID-enabled picking and packing
- Mobile guided replenishment from backroom to salesfloor
Providing Real-Time Data
Analytics and data is one area that e-commerce is ahead of physical retail. This is largely due to the fact that everything online can be measured, whereas retailers don’t really know what’s happening with their stores and customers in any specific detail, and the stats and data they do collect are often historical and at risk of being outdated.
However, with RFID this can all change. The simplest and most effective use of the data allows retailers to better leverage their greatest assets; their products and their stores. Quality data and analytics can allow retailers to ensure merchandise is in the right place to be sold. Information on which stores are performing better or worse is a basic retail KPI, but with specific item data, RFID produces far more detailed insights. This includes how well individual items are doing in specific stores, right down to specifics such as which sizes of items are selling better where. Insights such as these are naturally actionable, meaning retailers can take steps to move or reinforce stock at specific stores.
Data insights and results possible with RFID:
- KPI based performance tracking
- Detailed merchandise data & Analytics
- Operational excellence
- Actionable recommendations
- Compliance tracking
- Eliminates reliance on historical data
- Predictive capabilities for inventory counts and merchandise management
Transforming Customer Experience
There are many effects of RFID in retail that go beyond simple operational benefits to actively improve the customer experience. At the most basic level, this includes things already mentioned like increasing product availability, offering convenient omnichannel services and freeing up store associates to spend more time assisting customers.
However, because of the real-time inventory visibility it provides, RFID can go way beyond this in terms of improving the customer experience. For example, with reliable and up-to-the-minute stock information stores can utilise technologies like chatbots or smart fitting rooms to assist customers with their queries, supply information about other items or sizes available and even cross-sell to customers in the store.
What ways does RFID improve the customer experience?
- High product availability
- Store associates have more time for their customers
- Convenient omnichannel services
- A connected experience between online and offline
- AI-powered chatbots delivering assistance and product information via mobile.
- Smart fitting rooms providing a hugely improved fitting room experience.
- RFID-enabled Point of Sale – including self-checkout services
The age of digital disruption has caused a shift in both consumer expectations and the retail landscape as a whole. Naturally, many retailers have looked towards implementing new technologies in an attempt to either adapt to or capitalise on these changes. When researching new retail technologies, the focus should be on transforming the customer’s experience and eliminating existing friction points.
The question needs to be asked, is this directly solving a major problem for retail customers? In other words: Is there a demand for it? Focusing on the comparatively mundane details first needs to be a priority, as attention on what drives customer experience at the most basic level can be the difference between success and failure in the age of digital disruption.
One technology that consistently meets these demands is radio Frequency identification. RFID is a growing force in retail, with 69% of retailers around the world citing a significant level of RFID adoption. The technology involves tagging individual items of merchandise, like a barcode but entirely unique to the individual item that can be ‘read’ and tracked with ease. One of the most common business cases for the technology is the process accuracy and efficiency that it delivers, but the difference that RFID can make to the customer is not to be overlooked.
Empty shelves are a simple problem, and yet are still a painfully common occurrence in retail. In a survey by Elastic Path, it was found that 55% of shoppers surveyed had experienced an issue with out of stock inventory. Is it then any wonder then that ecommerce is putting pressure on brick-and-mortar stores?
As obvious as it might sound, a product can only be bought if it’s on the shop-floor. If replenishment isn’t automated or falls victim to human error, stores can be temporarily faced with unnecessary out of stock situations that damage both sales and reputation. This problem is often a subtle one, with stores and retailers having no way of observing the true level of item availability.
With a cloud-based RFID platform that utilises the Internet of Things, on-floor availability becomes much easier to manage, significantly reducing out-of-stock situations by up to 50%. The main way this is achieved is through fast and accurate stocktakes and automated replenishment processes. Store staff can now perform stock takes of an entire store (50,000 items) in just 25 minutes to a level of 99% accuracy.
This full and accurate view of store stock combats out-of-stocks in two ways. Firstly, the visibility of stock provides store staff to easily monitor stock levels. More advanced RFID systems like the Detego platform can not only operate in real-time and provide replenishment alerts, but can they can also use machine learning to suggest optimised replenishment advice, set on either a set planogram or an AI-optimised one.
Disconnect between online & offline
The increasing influence of online and ecommerce is arguably the biggest driver of digital disruption in retail. The convenience and choice that shopping online offers has resulted in highly demanding modern customers. Whilst these days practically every brick-and-mortar retailer has expanded into e-commerce to meet these consumer demands, there is unfortunately a noticeable disconnect between many retailer’s online and offline shopping channels, damaging the customer experience despite best intentions.
The key to a good ‘omnichannel’ shopping experience is not to necessarily be everywhere, but to be seamless and flexible at every step of the shopping journey. Non pure-play retailers that can do this will have a competitive advantage, not least because of the choice they offer customers, but with features like click-and-collect and ship-from-store, they can offer an unmatchable level of flexibility whilst opening up the entire inventory network to all channels.
To be able to do this, retailers need a complete and real-time view of stock across their store network in all channels. RFID provides this through digitising stock (utilising the IoT) and tracing the movement of individual items in real-time. With this foundation, it is possible to build extensive and reliable omnichannel services, blending shopping channels and providing a flexible and convenient experience for customers. RFID is the backbone of strong omnichannel services such as this. In fact, 83% of RFID adopters offer three or more omnichannel fulfilment options compared to only 24% of non-adopters.
At its most basic level, this can include opening up stock transparency to customers so they can check availability of items online before coming into a store. The more advanced features include click-and-collect and ship-from-store, both of which provide a competitive edge against pure-play ecommerce, as customers get a more convenient and flexible shopping experience regardless of which ‘channels’ they use.
Limited Customer service
When discussing disruption and new technologies, its easy to forget about core principles and traditional strengths, but technology should be built with those in mind. For retail stores, that means customer service. This remains a key part of physical stores’ USP today, but with the demand for store associates’ time being severe, these traditional strengths can sometimes be left behind.
In studies by Elastic path it was found that 42% of shoppers surveyed said they’d had an issue with long wait times for customer service, suggesting that something new is required to stop what was once a core strength of stores becoming a friction point for customers.
RFID platforms meet this demand in two different ways. First and foremost, is simply the fact that RFID operations are much leaner and less labour intensive, for example it cuts cycle count times by up to 96%. This has the simple yet effective result of drastically decreasing the amount of time retail staff have to spend on manual processes like replenishment, therefore freeing up a significant amount of staff time to be spent elsewhere with customers.
The other significant ways RFID can assist customer service are the platforms and features that can be built around the technology. Mobile chatbots can assist customers with queries about item availability and available sizes, thanks to the real-time item transparency produced by RFID. In the fashion industry, Smart-Mirrors can do this whilst also reducing the friction points associated with changing rooms, as they can provide information from within the fitting room and can also be fitted with features to call store assistants to bring any items required to the fitting room.
In recent years the digital age has shaken up retail in unprecedented fashion, and this trend looks sure to continue. One of the main causes of this change is the internet, not only the increasing influence of e-commerce but also the changing standards consumers are used to thanks to their near-constant access to the web. The new status quo of the digital world is connection and convenience, as modern customers have easy access to information and services on demand.
But is retail keeping up with this change? And what does it take for brick-and-mortar stores to meet these modern demands? Thankfully, the growth of retail technology means stores have more tools than ever to do so. Retailers need to look towards digital investment to reduce friction points and offer a more streamlined and connected shopping experience.
In other words, brick-and-mortar stores aren’t going anywhere, but they will have to evolve.
Enter the digital store
With customers being more connected than ever and used to the experience they can have shopping online, it’s time for brick-and-mortar stores to take some lessons and adapt. This shift is well underway, and as more brands continue to adapt one thing is becoming clear, digital doesn’t just mean online anymore.
Thanks to the Internet of Things, it’s now possible to digitise every single item in a store, in conjunction with tracking technology such as RFID. This allows retailers to leverage their most important asset, their merchandise, with greater precision.
For example, let’s present an all-too-familiar scenario.
You are looking to buy a new pair of shoes. You’ve decided to purchase them in-store because you want them today and need to make sure the fit is right. Before going to the store, you checked on the store’s website to check if they had them in stock in your size, but it didn’t say. After failing to find them in the store, you ask a store associate who offers to look in the back. You then wait several minutes, for them to return empty-handed, and offer their apologies.
There are several stages where this scenario could have been avoided with the application of the IoT. If every item is digitised and traced effectively, not only can stores know exactly what’s in stock, but retailers can share this information with their customers, and offer them more options like click and reserve and more.
Stores as Digital hubs
With this baseline of technology providing a clear view of inventory across store networks, the natural next step is combining and unifying digital stores with the rest of the digital network, namely other stores and the e-commerce online store. After all, online is already digitised by nature, and having all stock across all networks digitised allows retailers to leverage their products far better to serve their customer’s needs.
Whilst omnichannel has become a bit of a buzzword, with the focus on connection and convenience for customers, features like click-and-collect and ship-from-store are essential for leveraging physical stores. When supported with appropriate technology like RFID, retailers can offer extensive omnichannel services thanks to a real-time view of stock and the ability to track and trace items across the supply chain.
Features like this go beyond levelling the playing field with e-commerce as they do something pure-play online retailers can’t, offering their customers more options and a flexible shopping experience.
If you are interesting in further exploring how digitisation improves the customer experience, download our free whitepaper on how fashion stores leverage The Internet of Things (IoT) technologies to put the customer in focus of all activities.
If you are interesting in further exploring how digitisation improves the customer experience, download our free whitepaper on how fashion stores leverage The Internet of Things (IoT) technologies to put the customer in focus of all activities.
Just a moment, I have to check…
Making a great shopping experience can happen in seconds, but can also fail just as quickly. The customer who is ready to buy a desired article is often left standing in the aisle, being asked by the shop assistant to wait. He/she goes off to search for the article in the stockroom, perhaps call another location or check with the manager. If the article cannot be found, the sales interaction usually comes to an end with something like “Sorry, we don’t have it.”
The possibility that the desired item, say a skirt in size S, could be available in another store is something that the customer has to find out for themself. Of course they could try their luck online, and maybe even order it in the online shop if it’s still in stock.
That’s a shame. All that just happened because the shop assistant did not have the right information.
Lacking item visibility is a massive problem in the fashion industry, and almost all retailers suffer with lost profits because of it:
- If the article is not on the sales floor, it cannot be sold
- If no one knows that the article is in the stockroom, on display in the shop window or in the changing room, it cannot be sold
- If the sales person cannot give the customer information on the availability of an article immediately, a sale is missed and the customer is disappointed
- If the click & reserve inventory is not kept in sync with the store inventory, the reserved article cannot be sold
- If the article surprisingly “reappears” during inventory, for example someone finds it in an unopened box, it’s too late
- If there’s no item visibility in the individual channels, then flexible redistribution will not work
Getting the merchandise to where it is needed most
It’s the dream of every retailer: the merchandise offered is presented to precisely the customer who would like to buy it. With 5,000 articles in 700 stores in a variety of sizes, even the most experienced retailer can no longer make decisions by gut feeling.
- Sizes should not be evenly distributed among all stores
- Buffer stock should not clog up the stockroom
- Excess inventory that later has to be written off should simply not exist
Intelligent Merchandise Distribution
One is always wiser after the fact, for example at the end of the fiscal year or of a collection season, retailers know which items sold well in different stores and which did not. But then it’s too late. The merchandise ends up in the factory outlet store and eventually sold at discounted prices, the amount written off remains high, sales stagnate, etc.
However, retailers should immediately know which articles are sold well in which locations. Also, information on items that need to be reordered as well as the prevailing aging structure of articles at item-level per store is needed. To take the right decisions, it would be wise to have access to reliable real-time data in forms of dependable analysis and clear recommendations.
Actively manage your network of stores using real-time data:
- Real-time control over inventory and more efficient replenishment
- Quicker reordering
- Reduction in reserve stock
- Less merchandise in the channels, combined with greater inventory accuracy
- Smaller lot sizes, more precise control over the flow of merchandise
- Selling out collection merchandise at the planned margin, not via outlet sales
- Fast recommendations for activities to optimise the store
- Real-time dashboards promote the right decisions being made
- Rapid relocation of sale merchandise between the stores
Retail software specialists, Detego, have presented their ground-breaking methodology for in-store product recommendations, helping bring the same quality of cross-selling over from e-commerce and into the physical store. The new AI-based recommendation engine will enable retailers to provide personalized product suggestions utilizing data unique to store locations and point of sale information, without the need for identifying customer profiles.
Cross-selling through related product recommendations has always been a huge strength of e-commerce, with 35% of Amazon’s revenue generated by its recommendation engine (source). In recent years, innovations in RFID-based solutions such as smart fitting rooms and mobile chatbots have opened the doors to automated product recommendations within physical stores. Whilst the technology is now available, there is still one more hurdle between Brick and Mortar stores and effective cross-selling. This is namely the fact that the best recommender systems require vast amounts of both personal and aggregated data to provide effective suggestions, and whilst this is at a surplus in e-commerce, physical stores traditionally struggle with data being limited as well as sparse.
Speaking at the ACM UMAP 2019 in Cyprus in June, data scientists from Detego, who specialise in RFID-based software solutions for retailers, presented their proposed method of data-manipulation for in-store recommender systems with a paper titled: ‘Beggars Can’t Be Choosers: Augmenting Sparse Data for Embedding-Based Product Recommendations in Retail Stores’. The approach involves an alternative algorithm that leverages shopping-baskets and common-item combinations combined with point of sale information. Detego says this allows retailers to provide targeted recommendations with a 6.9% increase in quality, aimed at individual stores, without having to maintain separate models for each location. When combined with the technology to deliver these product recommendations, retailers could see a substantial increase in sales in Brick and Mortar stores, whilst customers will see a more connected and engaging in-store experience, as Detego continues to bridge the gap between online and the physical store.
“Customers who bought this also bought…” is no longer a phrase reserved exclusively for customers of e-commerce platforms. Due to the adoption of RFID-based technologies, such as Detego’s Smart Fitting Room, personalised recommendations can also be presented to customers of brick and mortar stores. Moreover, Detego’s AI-based recommendation engine is tailored towards the specific requirements of fashion retail stores, such as fast-changing and varying product assortments.’ says Matthias Wölbitsch, Detego data scientist.
With Detego now successfully rolling out the Smart Fitting Room application alongside their real-time inventory management software, this latest improvement is another opportunity for retailers to evolve their stores for the future.
Although the customer leaves an invisible data trail in the store, brick-and-mortar retailers barely use them to improve customer service. Dr. Michael Goller, CTO at Detego, explains why things need to change in the future.
Online retailing has not only created a new way of shopping, but also has a powerful toolbox to measure its results – with the overall objective to meet the customer’s expectations at all times. For that reason, online retailing has become the highest standard when it comes to measurement and evaluation in fashion retail. There is almost nothing that is not being evaluated while surfing the web shop. Conversion rate, click through rate, average order value, relation between new and returning visitors, bounce rate and retention time are just some of the KPIs that measure the success of online shopping activities. The really powerful thing about this is that analysis is always followed by action – usually fully automated.
And what about brick-and-mortar retail? It is about time to take some lessons…
The need for real-time data
For years, brick-and-mortar retailers have been complaining about imprecise stock-figures and unreliable historical data. Unhappy with its purchasing decisions based on last year’s sales figures, retailers would prefer to have real-time data and inventories that allow for reliable and economically viable decisions. After all, it is important to avoid high security stocks in order to reduce capital tie-up.
But why do we actually have this problem? Are the datapoints offered by the ERP systems not enough? Unfortunately not – it is not unusual that the ERP system shows higher stock than actually available on the sales floor. This so-called “ghost stock” is the cause for various problems in sales, e.g. the ERP system says a certain article, for example a red skirt in size S, is in stock, but in reality it is not. It can neither be sold nor refilled from the central warehouse – a classical out-of-stock situation. Or vice-versa, the ERP displays a lower inventory level than is actually available. The reason for these deviations is insufficient accuracy in individual processes that dangerously sum up over time.
Today’s intelligent article management is based on three pillars: fast, RFID-based article identification on item-level, tracking of every movement in real-time and proactive analysis with concrete recommendations for actions to take for the sales personnel. This is the foundation for optimum customer service and efficient processes.
Meaningful KPIs in the store
When measuring KPIs, the practical benefits for retailers are paramount. Three areas of data in the store can be distinguished:
- KPIs for inventory accuracy and product availability
- KPIs for campaign performance measurements
- KPIs on customer engagement and service quality
How KPIs are defined depends on the size and number of stores, the assortment depth and the flow of goods. Predefined objectives also play an important role: Whether five or 800 stores, KPIs for measuring inventory accuracy are significant for every retailer and still represent one of the main challenges in today’ business. Retailers, on average, can actually make accurate statements on just about 75% of their inventory (based on SKU level). However, this is not enough to meet customers’ expectations for omnichannel services. Therefore, inventory transparency and corresponding KPIs are essential for retailers´ success.
Product availability on the sales floor, also known as on-floor availability, is the second central parameter. Initially, it is less about the exact position and more about the fact that the articles are on the sales floor – after all, only items that are actually available can be sold. This key figure can be combined with an alert system that makes sure not to fall short of the defined minimum availability. Complementary to classical ERP-systems, an RFID-based merchandise management takes the data granularity to the next level, by knowing exactly at each moment in time if products are really on the salesfloor or still lingering in the backroom of a store. Having data on item level, store managers are also given important information on the dwell times of articles on the sales floor to gauge whether they are corresponding with the sales plan. One of the most famous KPIs in e-commerce is the conversion rate that describes the ratio between purchases and website visitors and also provides information on certain items that were already in the shopping cart, but for some reason have not been purchased in the end. Specifically this aspect was incredibly difficult to measure in the store for a long time but can now be measured in fitting rooms using IoT and RFID technologies. This provides meaningful insights into how many, and above all, which articles does a customer take into the fitting room and which one does she/he actually buy?
On an operational side, KPIs can also be used to manage the service quality. The replenishment rate, for example, states how quickly articles are replenished on the sales floor. On the other hand, the fitting room response time describes how quickly sales personnel handle customer requests coming from the fitting room.
The KPI “Conversion rate per campaign” shows the success of a campaign and if campaign-specific countermeasures are necessary / ©Detego
Turning data into actions
What else can brick-and-mortar retail learn from the web shop? Turning data into actions. Since nobody needs a data graveyard, any analysis of data has the goal to take immediate actions to improve. Today’s systems help the management team as well as the store personnel with concrete and automated recommendations for actions to take. This saves time in the decision-making process, unburdens the sales personnel, and enables them do the right things at the right time.
KPIs should be suitable for everyday business use. Presented visually and self-explanatory, they need to be linked to clear recommendations for actions to take. This frees up store personnel time and provides a data-driven way of optimization. Examples range from simple in-store replenishment advices, i.e. “The minimum stock for article #47699-0010 has been reached – please refill three pieces” to more advanced topics, e.g. to choose a different placement in the store for a specific article when the dwell time on the sales floor is too high compared to other stores.
Brick-and-mortar retail definitely needs support and an update to the toolbox when it comes to analysis and measures. Not only does the sales personnel benefit from intelligent recommendations for action, but the management team also gains efficient control mechanisms across the entire store network. Decisions are made on the basis of real-time data and therefore allow timely action. Ultimately, the end customer is pleased about a first-class service, which – thanks to the individual and informed advice through the sales personnel – even exceeds the standards of the online retail.
Why should fashion retailers deal with IoT? What problems could be solved in the stores? What results can be expected? As a retail decision maker you need to deal with IoT if increased article availability, exact inventories, interaction with customers and operational excellence in your stores are set as objectives. This practice-oriented guide sheds light on the triangle of “customer”, “processes in the store” and “deployment of new technologies” and shows how the use of IoT benefits retailers and ultimately the customer. The whitepaper reveals the formula for the perfect customer relationship, based on the right technologies and processes and shows how retailers can apply them to their business.
Detego, a market leader in real-time business intelligence for the fashion retail industry, is releasing its latest whitepaper, providing valuable information on the use of Internet of Things (IoT) in fashion stores. Titled as “The perfect customer relationship – How fashion stores leverage Internet of Things (IoT) technologies to put the customer in focus of all activities “, fashion retailers get a practice-oriented guide that highlights the most important aspects such as: Why should fashion retailers deal with IoT?, What problems could be solved in the stores?, What results can be expected? Retail decision makers need to deal with IoT if increased article availability, exact inventories, interaction with customers and operational excellence in the stores are set as objectives. The 35-page guide sheds light on the triangle of “customer”, “processes in the store” and “deployment of new technologies” and shows how the use of IoT benefits retailers and ultimately the customer. The whitepaper is available for download on the Detego website.
Detego discusses the various IoT technologies as a way for retailers to realize the perfect customer relationship. Based on customer’s needs, the practical tips are divided into 1. Self-service in the store: The customer as the main actor, 2. Brand Ambassador: The customer as influencer, 3. Co-Value Creation: The customer as partner and 4. Predictive Analytics: The Customer as creator of the future. All four subchapters describe what retailers can do to connect with the customer and enable an interaction in the store.
In addition, infrastructural prerequisites such as the optimal process support through IoT technology and in particular support for the sales personnel are discussed. With the help of IoT, retailers and their store personnel gain valuable data that is translated into recommendations for concrete action to take. In addition to the operational excellence in the store, it is primarily about the new shopping experience for the customer. The whitepaper reveals the formula for the perfect customer relationship, based on the right technologies and processes and shows how retailers can apply them to their business.
The one-size-fits-all sales approach is outdated. In the store, intelligent systems are needed to provide the customer with a personalised experience. Key elements for this are individual and personalised recommendations from the current product range and simplified processes that give stores associates more time for the customers.
In this webinar you find out how “Data Driven Empowerment” activates cross-selling potential, increases the number of articles per receipt and finally leads to satisfied customers and happy retailers.
All store assistants are busy at the moment and another customer enters the store. She has only one question: “Is the skirt in the shop window also available in XS?”– It’s not going to take long, however, nobody is available to assist. She briefly looks around on the sales floor…finds nothing and therefore leaves the store.
Increase service quality in the store with Artificial Intelligence
With digital sales assistants, fashion retailers no longer have to keep consumers waiting but offer them a convenient service. The chatbot serves consumers via smartphone by answering initial questions such as: Is the article still available in my size? Where can I find it? How expensive is it? What accessories go with it? If an article is out of stock, Detega makes suggestions, e.g. to have the desired article shipped from another store to the customer´s preferred store or even directly to her home.
Recommendations for more consumer engagement
If a store assistant recommends additional articles to a customer, it could easily backfire as unwanted assistance can be considered intrusive and the customer might avoid visiting the store in future. However, if a chatbot recommends an article that the customer clearly perceives as a possible additional purchase, he/she will have no problem considering the recommendation or rejecting it by simply swiping it away and look at other articles that he/she likes better. Chatbots enable a non-binding yet personalised dialogue – just as customers are familiar with online shopping.
Detega Video – Initial dialouge before sales personnel takes over
The use of digital store assistants. Benefits for retailers.
- starts a dialogue with the consumer via smartphone as desired
- notifies store personnel to bring certain articles to consumers
- pushes purchases through „live“ discounts
- brings online shopping experience into the store
- activates cross-selling potential by letting customers browse through the entire product range
- recommends articles that are actually available in the store
- supports as well as unburdens store personnel
- deepens the brand experience
- compiles data on customer clusters and their preferred article combinations
- continues to interact with customers after they leave the store to inform them about special offers, etc.
- offers after-sales services to customers such as reservations in the store
The use of digital store assistants. Benefits for customers.
- helps with the decision-making process using information
- provides useful product recommendations such as: popular items, bestsellers, reduced articles and product variants
- accurate product recommendations due to Artificial Intelligence
- offers self-service via customers‘ smartphone
- offers online shopping experience in-store
- answers immediately – customers are not kept waiting
- gives information in real-time
- notifies the store personnel to bring desired articles directly to the customer
- allows customers to browse through the full product range
- guarantees an unforgettable shopping experience
- passes on customers to sales personnel when required
„At the Point-of-Sale, the chatbot serves digitally-oriented target groups via their smartphones and passes them on to the sales personnel for individual service whenever the sales process requires it.“
Dr. Michael Goller – CTO Detego