Resilient Retail: 2022 Trends and Predictions Involving Technology

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Around the world, retail customers are yearning for some normalcy and a return to the social experiences that come from in-store shopping. In concert with this desire to frequent “bricks and mortar” and have in-person bonding, the retail sector is facing some challenges and constraints with the renewed increase in store traffic.

But not all is what it used to be. Health and safety practices are top of mind for everyone, especially retailers. Customers are having to comply, and retailers are having to uncomfortably enforce, the politicized “mandatory mask protocol”. The mask mandate has led to some heightened emotions and uncomfortable confrontations.

Add to the mix the supply chain issues we are currently experiencing; they create the challenge of long wait times for product and a lack of inventory leading to drastic price increases. We are also seeing major workforce shortages, and because of this, customers are not getting the attention they need or expect based on past shopping encounters with brands they are loyal to.

More than ever, customers have become impatient and unforgiving in their service standards. Stores across Canada are having to contend with annoyed and hostile shoppers and heightened criminal activity. For this reason, many workers have left retail for other opportunities. They don’t want to deal with the aggression, and in some circumstances, very dangerous altercations.

Impacts of organized retail crime

Image: Courtesy of Axis Communications

Another challenge retailers are having to tackle is organized retail crime (ORC). It’s rampant and even more so in the last two years. Culprits today are taking advantage of the face mask requirements and easily walking into stores and out with hands full of merchandise. This creates and internal threat to both workers and other customers in the store.

Canadian retailers estimate that ORC costs them over $4.6 billion each year. And guess what? The cost of the loss and the increasing surveillance and security required to curb or prevent it is passed onto the consumers through price increases.

In some cases, some of these criminals are stealing goods in the store, don’t leave the location, but take the goods to the counter to return them for cash back. In this case, imagine if the retailer had something at their fingertips to view the last few frames of some video footage from a camera that shows the criminal picked the goods in-store and that they are creating internal fraud without a receipt to get a store credit. With the footage, the store clerk is not having to question the thief, but rather now has evidence and can address the situation accordingly, in a different manner.

Rethinking customer experiences

Image: Courtesy of Axis Communications

Tackling all these challenges has meant rethinking the way retail stores operate, so that people feel protected and that customers get the service they come to expect. Some customers continue to avoid shopping in-store as they don’t want to deal with potential negative encounters, preferring to shop online instead. E-commerce does come at a cost though for shoppers and retailers. Shoppers can’t touch the product, try it on and if it does not fit, spend time coordinating with a delivery company and paying to return it. For the store, it also means time and money.

How does surveillance technology help with all these problems in today’s retail setting? First, we need to look at store planograms and store owners can start by reviewing the visuals from the video cameras they installed for loss prevention. They can serve as a tool to monitor how stores are set up/what each section looks like, what the merchandising looks like and to suggest layout adjustments to their staff all while doing it remotely from a master control desk as opposed to traveling to various locations.

An important thing as a surveillance technology provider in the retail industry, is providing retailers with a loss and prevention solution and to figure out how to take those owned approaches and devices, i.e., cameras, audio speakers and use them to create that same seamless level of in-store service and customer enhancement that is offered by the brand digitally. Therefore, it’s essential for store owners to research and purchase surveillance product that serves their needs today and in the future. Not only for theft prevention but for overall operational and customer support.

Marrying digital an in-store service

Image: Courtesy of Axis Communications

For many, bridging online and in-person service means looking at the grassroots and listening to the way retail has changed. For the e-commerce buying experience, customers walk through the gateway of an IP address, they pick their purchase, they review the total price and then they open a new tab and look at other similar competitor merchandise. They compare prices and then they potentially leave their online basket without purchasing. At which point, retailers then market the product digitally via email or retargeting, saying to the customer “Do you still want this item?”

Now imagine this concept of online analytics but for physical stores, where things like demographics, people counting, conversion data, heat mapping, user flow of the store all being captured by a surveillance dashboard that can be analyzed via a central monitoring system. Imagine taking this data to make decisions that are in best interest of your store and your customers.

Surveillance is being used to assist stores in their marketing, sales, and service requirements. Imagine capturing data like when a woman enters a store, the first place she looks is to the right. Meanwhile, men are walking in and tend to stand in the center of the entrance. It would be opportunistic to place some value items close to those locations, that get interest and high traffic. Or, to draw attention to promotions. Putting this kind of information in the hands of retailers is valuable. Consider an endcap – knowing where your highest foot traffic goes and planning store layout and merchandising around that.

Think of this, even in a mall situation, the average shopping mall could have ten thousand people flow through the building each day, but perhaps less than 1% stop and buy goods. How do you attract that group? You can have a camera monitoring the outside of your flagship store and put a sign at the entrance saying, “If you show us your receipt, you’ll get a discount on a coffee at X coffee shop in the mall”.

What if you put a sign outside your flagship store saying if you show your receipt to us, you’ll get a 50% discount on a coffee. And now suddenly, you are utilizing the other traffic to be able to create that 4/1 show conversion rate and so whether we do that in-store or in place, we can do a lot with the journey.

Global workforce shortages

Image: Courtesy of Axis Communications

Many retailers are offering guaranteed hours now, which we’ve never seen before. Normally they hire for the holiday season and let them go in January. But now many are going to that structure, so why not use technology to help.

When we look at the shortage of staff that retail is experiencing, in-store efficiencies suffer. Processes like self-checkout should be monitored for people using them versus the standard point of sale exchange. Also, how many people are in store queues at any given time/how long are the lineups? What are the busiest times for the store? The buying habits of individuals have changed. With artificial intelligence (AI) and surveillance analytics, stores can access this information dimensionally and see that their queue line may be greater than six people, 25 times a week and generally between 12-3 pm. By analyzing this surveillance data, a decision can be made here for the store to staff up to avoid the overcrowding at that time.

If the retailer can’t bring in people, with the assistance of surveillance, they can create an audio experience for the customer with live broadcasting, sharing messages like “We understand it’s longer than normal wait times, please feel free to use the self-checkout,” or “See a store associate and we’ll help you in some other way.” This lets the customer know that you care about them. Stores can also use surveillance audio to play tranquil background music to calm customers who may be frustrated by the wait.

Online orders and curbside pickup remain

Image: Courtesy of Axis Communications

Buying online and curbside pickup are elements of retail that we’ve proven to the consumer works and it will remain. It will become another cycle of retail life. However, can we help the person that came to pick up the item they bought online with a better curbside pickup experience? Surveillance solutions can help determine how long they have been waiting inside the store entrance or outside – was it longer than five minutes? How many times did that occur this week? With the assistance of cameras, stores can determine how to make this process more efficient for people by identifying the model of their car or license plate number.  So, when they come to pick up, a store notification is made to have their order delivered to them faster.

As the stores change to meet customer demands and the new way of shopping, we are going to see heavier e-commerce competition in the year ahead. Those retail locations that still focus heavily on brick-and-mortar shopping, that want to create that 24-hour same-day or next-day delivery, they are going to have to offer more ship from store service. But to make that work, they may have to change the layout of their store to accommodate and get the space they need to facilitate pick-up or deliver. That said, they can analyze their surveillance data to determine the best floor plan that won’t create safety issues like blocked fire exits or other important store flow areas, where placing online buying packages cause a hazard. Video analytics and operations help raise these questions and can solve for these issues. Sure, it’s store policies, people and procedures that help solve for all this, but surveillance technology is an aid in the overall decision making.

Advancements in AI and facial recognition

Retailer technology solutions will continue to grow and advance because of artificial intelligence. With their processing capabilities they are going to need to balance two things, the ethical use of analytics and how it applies to retail, so that a level of privacy is created that customers expect. And that enhances their experience, while optimizing how operations impact the bottom line and the top line of the business every single day.

Facial recognition has proven to be an effective asset for customer service, business enhancement and safety outcomes. Although, many retailers are not ready for it yet, in Canada, it works well in a store’s arsenal against organized crime and repetitive theft. It can also be used to link in-store shopping to a digital marketing nurturing experience. Such as, the sweatshirt your customer looked at five times, but did not buy, can be followed up by sending an email with a coupon motivating them to come back and buy it.

If retail loyalty programs ever get to the point where they incorporate facial recognition, anytime a customer walks into a store, the store can synch their entry with multiple digital displays inside that say “X customer is here, show her a coupon for this product area,” i.e., shirts.

However, the world is not prepared just yet for how personal activity intelligence (PAI) data is shared, so we need to think about integrity, think about use case and protecting personal and identifiable information in general, which is so important.

Smarter and safer retail

Image: Courtesy of Axis Communications

When we talk about becoming a smarter and safer world, it rings true for retail because we are solving for all aspects from customer service, business optimization and health and safety. By combining hardware with video analytics, stores find ways to reduce queuing times, perfect their store layout, allocate staff efficiently and protect them, and, ultimately, increase profits. They can even use surveillance equipment as a tool for creating a welcoming environment to attract visitors and inspire employees. They can improve security, reduce shrinkage, and increase operational efficiency even further.

More important than ever, with the way things are in the world, safety is top priority and so is streamlining operations. Technology is great for retail efficacy and efficiency. It makes our lives easy, and we want more of it, but privacy is a concern. This means cybersecurity must be at the forefront. Businesses need to invest in cybersecurity. This becomes the other side of protecting that personal data that customers entrust retail with. The last thing a business wants is to sign up members to a points program, and suddenly all their data or points are taken. We are seeing some big value data stolen every day.

Effective cybersecurity involves assessing risks and consequences and taking appropriate steps. Surveillance products should have built-in cybersecurity features, that are designed to decrease the risk of compromise and enable secure behavior. Staying cybersecure takes more than products with cutting edge technology. It’s also about ongoing store processes that take effort to maintain protection.

Keith D’Sa

Keith D’Sa is the country manager for Axis Communications in Canada and is responsible for all business operations in the region, including new business development, marketing, professional services and sales team leadership. D’Sa also manages Axis’ relationship with local distribution and channel partners.

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