Categories
data Editor's pick mobile Retail technology

5 ways 5G will impact retail

Last month, mobile phone network Three ‘switched on’ its 5G service in London through an immersive experience with fashion designer Henry Holland.   

The “Living Room of the Future” initiative saw visitors able to try on mixed reality headsets from Magic Leap, to enter into a world consisting of everything from a mindfulness moment, to a gaming experience and the delivery of (virtual) House of Holland shoes by drone to your door. 

5G is expected to ramp up in 2020 on a global level. Further cities in Switzerland, Spain, Germany and Italy have already begun adopting it. Meanwhile, in the US, although four cities have turned on the signal, the technology is tied up in a trade war, since China’s Huawei is the dominant 5G supplier. Regardless, the latest Ericsson Mobility Report predicts there will be more than 10 million 5G subscriptions globally by the end of this year, and that 5G population coverage is forecast to reach 45% by 2024.

In it simplest sense, 5G is just a faster version of 4G – about 20x the speed in fact. That coupled with almost no latency, means the new networks will nearly eliminate lag time. This is big news for mobile of course – opening up paths to purchase in even the busiest of crowds for everyday shoppers. 

But its existence will also help power other tech advances, from machine learning to digital realities. Add in features like low energy consumption and higher reliability, and it brings an opportunity for the retail industry to enhance the consumer experience in the physical store with a number of seamless real-time functionalities, leading to increased engagement and conversions. 

As a result, now is the ideal time for retailers to start planning how their stores and interfaces will look when 5G becomes widely available. Here are 5 ways we see it having an impact… 

Connected Spaces

Connectivity in our physical stores, means devices that can constantly exchange data with each other – also known as those under the header of the Internet of Things (IoT). To do so, they need a fast, reliable network that doesn’t require too much power. 5G networks will achieve a 90% reduction in power consumption, guaranteeing up to 10 years of battery life for low power IoT devices. This means, for example, that more retailers will have access to smart shelves like the ones Amazon implemented in its Amazon Go stores. This technology uses dozens of sensors to provide real-time inventory visibility and update pricing according to demand. 

Key tech we’re tracking: dynamic pricing, automated checkouts, connected fitting rooms, automatic replenishment

Amazon Go Store
Immersive Experiences

Augmented and virtual realities use a lot of processing power and cellular data. With the increased capacity of 5G networks, retailers will be able to create richer, more detailed experiences when integrating their physical and digital worlds. This will make technologies that we’re already experimenting with, and seeing consumer adoption of, only more of a possibility. The result will mean shoppers are able to immediately check product materials or ingredients through the use of smart glasses or their smartphones, for instance. Those same apps will also guide customers to the products they want by projecting directions into their field of view in real-time as they navigate the store space.

Key tech we’re tracking: immersive interfaces, gamification, wayfinding

Puma’s new flagship store with gamification
Higher Efficiencies

Artificial intelligence will also thrive on IoT devices via 5G. That’s not to say the AI algorithms themselves will change, but that the higher network will enable more accurate real-time data to flow, ultimately facilitating smarter systems. In retail, for instance, managers will be able to delegate more operational and inventory decisions to automation. This means greater efficiencies as well as accuracies on things like forecasting inventory quantities so as to optimize stock levels, leaving sales associates to spend more time on customer care. Having stock in the right place at the right time will also decrease the risk of losing customers to competitors, as product availability will be more accurate. 

Key tech we’re tracking: retail analytics, inventory visibility, demand forecasting, endless aisle  

Walmart’s endless aisle
Personalization

With lower latency, retailers will also be able to respond to purchasing patterns and behaviors with immersive, tailored content in real-time. Implementing 5G in-store will allow for greater interactions and data collections between sales associates and customers. Real time data could be tracked to create personalized adverts or offers based on the preferences of individual customers, helping to increase the incentive to buy. 

Key tech we’re tracking: marketing automation, personalized promotions, AI recommendations, product search tools, clienteling

Nike’s Melrose store
Fulfilment

The implementation of 5G will also revolutionize logistics by improving  efficiency in fulfilment tasks and increasing the speed of transportation. Greater connectivity and improved reliability will help communications between brands, couriers and consumers. The full capacity of 5G will eventually also enable the roll out of automation in transport and warehouses, thanks to improved processing of the vast amounts of data required in real-time. 

Key tech we’re tracking: smart warehousing, robotics, automated vehicles

Lowebot assisting a consumer

Additional reporting by Larissa Gomes.

How are you thinking about retail innovation? The Current Global is a transformation consultancy driving growth within fashion, luxury and retail. Our mission is to solve challenges and facilitate change. We are thinkers and builders delivering innovative solutions and experiences. Get in touch to learn more.

Categories
business e-commerce Editor's pick mobile

Nordstrom’s new store concept will carry no inventory

Nordstrom Local
Nordstrom Local

US department store chain Nordstrom has announced it is preparing to roll out a new store concept that will tap into consumer demand for convenience and speed with a smaller and much more dedicated retail space.

Nordstrom Local stores will carry no dedicated inventory, with customers who want to shop only able to do so via Personal Stylists. In a bid to  focusing on tailored service over footprint, the space will sit at 3,000 sq. ft, compared to the average 140,000 sq. ft Nordstrom store.

“As the retail landscape continues to transform at an unprecedented pace, the one thing we know that remains constant is that customers continue to value great service, speed and convenience,” said Shea Jensen, Nordstrom’s senior vice president of customer experience, who led the Nordstrom Local initiative. “We know there are more and more demands on a customer’s time and we wanted to offer our best services in a convenient location to meet their shopping needs.”

Customers can book in appointments online, over the phone or in-person. Following one-to-one conversations, the stylists will then transfer in suitable merchandise for the respective clients to come in and try. Stores will have one styling suite and eight dressing rooms accordingly, all of them surrounding a central meeting space where customers can enjoy a drink and talk to their dedicated stylist. Other services include Alterations & Tailoring, Click & Collect and Curbside Pickup, access to Trunk Club and an on-site nail salon.

The on-site personal stylists will also be armed with the retailer’s new digital tool, Nordstrom Style Boards, which allows them to create digital boards filled with personalised fashion recommendations that customers can view on their phone and purchase directly through Nordstrom.com. Customers can also log into the app to have more extensive conversations with salespeople and stylists.

The first Nordstrom Local is set to open in Los Angeles, California, on October 3. It follows the announcement of Nordstrom’s increased Reserve & Online Try In Store service earlier this month.

Categories
business data e-commerce Editor's pick technology

Intel to invest $100m in retail tech anchored by IoT, data-led platform

Intel demonstrated next-generation Internet of Things technology at the 2017 NRF Retail's Big Show
Intel demonstrated next-generation Internet of Things technology at the 2017 NRF Retail’s Big Show

Intel is planning to invest over $100 million in the retail industry over the next five years, it announced at the NRF Retail’s Big Show in New York this week. At the heart of that is the Intel Responsive Retail Platform (RRP), an Internet of Things solution that it says will “take retail to the next era of highly efficient and personalised shopping”.

Through RFID, video, radio and other sensors, it will enable easy, holistic integration, help to deliver a 360-degree viewpoint of retail from the store floor through the supply chain, and deliver real-time, actionable insights, the press release explains.

Intel is looking to transform the industry through this platform – driving operational efficiencies and creating new and exciting customer experiences, both online and offline.

Brian Krzanich, CEO of Intel, said: “The retail platform collects multiple data streams to connect digital and physical environments. With the goals of lowering costs and increasing sales, the platform helps optimally place inventory, deploy employees and other resources, and track inventory – through the supply chain to the store door. It provides in-the-moment information about what customers are buying, what they want and how to manage inventory so it arrives just in time for customers to take it home.”

He added: “Our technologies can see what items are not in their correct location and the up-to-the-minute store inventory, including what’s in the back room. They can even tell what items go in to changing rooms, but never make it to the cash register.”

Data is the critical factor, he explained. “At Intel, we believe that increasingly retailers will be separated by those who have data and use it to grow and optimise the shopping experience, and those who don’t and make their decisions based on ‘experience’ and subjective observations.”

Virtual reality and artificial intelligence features will also become a part of the platform in the near future, Krzanich added. He nodded to Alibaba already empowering customers to use VR to shop from their homes, calling it a potential “game changer” for retail. “The immersive technology is opening doors for retailers to creatively reach new customers and markets,” he explained.

Meanwhile technology like robots and artificial intelligence will free up employees, enabling them to better focus on the customer and improve the store’s performance, he added. “We’re developing technologies that will help transform the shopping experience in the near future. By bringing together virtual reality and the power of data, we’ll help create the store of the future – one that is smart, responsive, connected and secure.”

Categories
Blocks business technology

Zara adding RFID tags to all garments to enable faster stock control

Fast fashion retailer Zara is set to make its supply chain even speedier thanks to the addition of a new inventory tracking system.

The Inditex-owned store is putting radio frequency identity (RFID) tags into all of its garments, allowing them to be traced from factory to point of sale.

The initiative will improve inventory management by rapidly highlighting pieces and sizes that need restocking, reports Reuters. It will also enhance things like security and customer service – the system will make it possible to identify whether a particular item is available in a certain size or not, or whether online or a nearby store has it instead, for instance.

“[The] implementation of this next-generation technology is one of the most significant changes in how the group’s stores operate,” said Inditex chairman and chief executive Pablo Isla during the company’s annual general meeting.

He said the chip system is already in place in 700 of the company’s more than 6,300 stores (that portfolio includes other brands such as Massimo Dutti and Bershka). It will roll out to a further 500 per year from here on out, with plans for Zara specifically to have it in all stores worldwide by 2016.