RFID & Smart Store Inventory Management

Transcription

1 RFID & Smart Store Inventory Management

2 Retail s new reality Retail has persevered through more disruptive change over the last 20 years than it experienced collectively in all its previous history. Not only did the internet enable an entirely new channel in online e-commerce, but smart internet technologies informed and empowered consumers like never before, placing shoppers in an unprecedented position of power and authority for the first time, shoppers are calling the shots. Simply, technology has changed the way consumers approach nearly every facet of their lives, and the connected world has spawned new collaborative consumption business models along with smart devices, smart healthcare and transportation, and even smart cities. And, now, smart retail. Today s new shopping journeys transcend single channels and instead encompasses them all, sometimes one channel and touchpoint at a time in sequence, but more often synchronously, with multiple touchpoints and channels being engaged by shoppers at the same time. For the most part, retail s mobile and digital channels are keeping up with the pace of change dictated by shoppers, more closely meeting shopper expectations than their counterparts in stores. It s time now for smart retail to get its smart store - across retail s entire ecosystem, including store operations and marketing, and design for the betterment of the shopper experience. 2

3 Smart store inventory management Inventory management has always been at the heart of a well oiled retail machine with sales and service forever being dependent on having the right product at the right place at the right time and at the right price. In today s new cross-channel, multichannel retail environment, inventory management has climbed in importance as shoppers expect seamless fulfillment, while channels have become more complex as the reverse supply chain, returns, has grown more prominent. Inventory management started the not-so-good, old fashioned way merchants used paper and pencil to track products that were sold, used or consumed, lost and remaining in inventory. It was an important, but rather thankless, time-consuming and resource intensive task that produced fairly inaccurate results. The information era ushered in computer automation as a remedy, and bar code scanning allowed for tremendous gains in both efficiency and accuracy. However, while bar code scanning eased the time burden substantially, it still required the direct line of sight and the scanning of each individually coded item, one at a time. Leading-edge inventory management processes now deploy Internet of Things (IoT) technologies like RFID radio frequency identification to accurately track products in real-time. As a technology, RFID isn t new, but over time it has developed and evolved to the point of near perfect accuracy with much lower costs. Furthering its value, RFID can read multiple signals or tags (i.e., multiple products) at one time, and at a much faster rate than previous scanning technologies. Plus, RFID can be read from a distance and is not dependent on a direct line of sight as optical sensors are not necessary. Real-time inventory management data on the movement of merchandise coupled with RetailNext s Traffic 2.0 analytics for in-store shopper movement and behavior now provides retail professionals a more clear, complete understanding of what s happening in-store, areas of strength and opportunities to continuously enhance customers shopping experiences. 3

4 RFID RFID allows retailers, particularly brands who control the manufacturing and packaging of their products, to examine the entire supply chain, from factory to shipping dock, from warehouse to store. RFID tags containing a unique identifier are attached to every SKU of merchandise, and RFID readers are deployed, either fixed in the ceiling or perhaps handheld, and often also integrated into POS terminals. These solutions provide answers to questions like: Where is this product? How many more of this product do we have? Where are critical inventory shortages? Where are the bottlenecks in the supply chain? Current applications of RFID technology integrate with other IoT sensors to provide a more complete understanding of how merchandise moves throughout the store in relation to shoppers and their shopping behaviors. With the newest generation of RFID scanners fixed to the ceiling, a store is able to determine the exact, precise location of merchandise within the store, be it on a display rack, table or shelf, in a fitting room, or at a POS checkout. In addition to the benefits of using RFID to manage the entire supply chain, the precision of inventory location is ideal to A/B test different displays, fixtures, lighting and other merchandising strategies to determine optimal tactics. The store applications given above use examples of passive RFID as opposed to active RFID. In passive RFID, all the smarts are in the RFID reader and the individual RFID tags don t need a battery, and therefore are inexpensive and last in all practical terms forever. 4

5 RFID tags The RFID story begins at Chapter One, the smart label, or the RFID tag. The RFID tag communicates with the network to uniquely identify each and every product and to measure its movement. Once a technology used for cattle, it s now commonplace in retail, healthcare, transportation and other industries, and it s part of the technology foundation that empowers new retail concepts like Amazon Go. Tags like those from Acuitas Digital alliance companies Nexgen Packaging and Valmarc Corporation enable communication not only between merchandise and a brand s internal applications, but to shoppers, as well, allowing access to additional product information in the cloud. Not a question of either/or, but both? Whereas the question used to be RFID or barcodes? considering the complementary nature of the two tagging technologies, the better question is, Why not both? RFID s strength is inventory visibility and control, but shoppers smartphones can t read RFID tags. But, if the RFID tag also has a 2D barcode, consumers can directly engage with the product, delivering a synergy that makes one plus one equal three or more! Valmarc Total Vision s universal interactive serialization technology includes a smart tag printed on a hang tag, garment size or care tag, or any tag, and displays a two-dimensional barcode containing a unique identifier specific to that unique single product. When a consumer scans a Valmarc tag, it opens access to a plethora of brand- or retailer-supplied information, including product specifications, videos, ethical sourcing data, use and care instructions, or anything desired to be communicated prior to sale. The brand establishes a specific set of communications appropriate for each product and can change them in real-time to reflect promotional offers or other changes. Both consumer and brand information is protected from snooping by other parties, and the relative frequency of the scans by consumers seeking information allows the brand to gauge initial interest in the product, including color, style and other variables, providing an early indicator of market acceptance, well before sell-through and reorder information is available. Additionally, as consumers scan products, the brand can concurrently check a shopper s identity - with permission - for loyalty programs or incentive rewards, along with the product s location and unique serial number for indications of product diversion or even counterfeiting. 5

6 Labels Make a Bold Statement The label s role in the marketing and distribution of apparel and footwear continues to expand - powered in large part by Nexgen Packaging s innovative product design, new label RFID production methods, and the company s many strategic partnerships. Packaging is fundamental to an item s brand statement, and is becoming even more so as it evolves into a data storage and communication vehicle. Nexgen specializes in building brand solutions for apparel manufacturers and retailers, combining traditional woven and printed labels, heat transfer labels, hanging tags, patches and more with the newest technologies like RFID and serialized 2D bar codes (in conjunction with Valmarc). Attention to brand is reflected in how Nexgen leverages RFID to help brands and retailers wirelessly track items from manufacture to store shelves. Today s RFID labels boast brandboosting features like offset quality printing, recycled paper stocks, color-by-size markings and rounded corners. Thanks to smaller footprint inlays, RFID circuits can be more easily embedded into existing packaging with minimal efforts. Besides giving customers the brand, size, care instructions, price, and other information; labels are part of the toolset for tracking garments throughout the store. With Nexgen's production development and e-commerce platforms these same labels also provide supply chain visibility around the globe. Nexgen has incorporated the newest Sato CL4NX thermal transfer printer, leveraging Nexgen s IoT platform for real-time pairing of a garment s EPC code with the RFID chip s TID code so no EPCs are ever duplicated. Integrations with platforms like Smartrac s SmartCosmos and Acuitas Digital Group further ensure seamless information exchange across partners and easy interoperability between technologies like service bureaus and in-plant printing. 6

7 RFID readers Whereas Chapter One revolves around smart tags, the story would end abruptly and prematurely if not for Chapter Two, RFID readers. An RFID reader is a network-connected device that can be either fixed mounted in a ceiling, for example or mobile like in a hand-held device and provides the connection between the tagged merchandise and the enterprise system software that harvests the data information. The reader simultaneously communicates with all the tags within its field of operation no line of sight needed and performs any of a large number of tasks, including continual inventorying, search and filter of tags that meet certain criteria, or even writing and encoding to selected tags. 7

8 From data insights to action Throughout its relatively short history, brick-and-mortar retail technologies have typically been offered independently of one another as single point solutions, and were designed to capture data, not necessarily to share it with other store systems. Without the big picture view of combining disparate data sets, data was created in a vacuum, and left unactionable. When it came to return on investment (ROI), single point solutions were good at generating the I, not so good at generating a satisfactory R. IoT platforms, like those of Acuitas Digital alliance charter members BT, Sato Global Solutions and RetailNext, link applications, data and in-store communications. Data sets are created by shoppers and their shopping journeys and behaviors, any of a retailer s store operations or back office departments, external vendors and even other data generating systems like point-of-sale (POS) and weather forecasting and reporting. The result is a comprehensive understanding of both shoppers and the business, leading to better, more complete decisions for the benefit of both - after all, what s good for shoppers, is good for the business. Leveraging data, developing insights and effectively taking action adds value and dramatically boosts ROI. 8

9 A tale of three dresses When looking at POS data, a merchandiser notices varying sales results for her three biggest hopes for the season. Dress #1 is steadily selling at her expectations, but dresses #2 and #3 are not, with dress #3 the worst performer. Should she markdown dress #3 and/or #2? Should she look for promotional help from Marketing? To gain greater clarity on root causes, she looks at RFID data and the movement of the dresses in the store. It s there that she notices dresses #1 and #2 are often taken to the fitting rooms, but from there, #1 very much outsells #2. Dress #3, on the other hand, rarely makes it to the fitting room at all. Now, she s able to refine her decision-making. Dress #2 engages shoppers and entices them to try it on. As it s not converting into sales from the fitting room, perhaps there is an issue with fit, color, or style. It might just be time for markdowns. Diving even deeper into RetailNext s in-store retail analytics data, the merchandiser integrates video data streams with the RFID stream and identifies a lack of foot traffic to the display fixture that hosts dress #3. On a percentage basis of shopper traffic, dress #3 actually outperforms dress #1 in both trips to the fitting room and sales. Dress #3 is not a candidate for markdowns or other promotional activity. Rather, the issue with dress #3 is its display, its store location, or both! 9

10 A smarter fitting room The fitting room is a critical stage in the customer journey, one where many purchasing decisions are ultimately made. SATO Global Solutions Smart Fitting Room application allows retailers to stay engaged at a point in the shopping experience where visibility is typically lost. And, SGS does this through the integration of its Sales Associate and Smart Fitting Room applications. When your shopper in the fitting room requests an item via a wallmounted tablet, your sales associates receive the request on their mobile device, complete with the fitting room location and the item/items requested. The application empowers a concierge-like service from associates who are only a touch away. No more journeying outside, hastily dressed, or calling for associates, hoping for a response. Just a frictionless shopping experience, every time. Of course, if you can t find it, you can t sell it. In an increasingly ecommerce-obsessed-world, in-store availability and inventory management are more important than ever. Customers expect instant access to the right size, in the right color, at the right time. The SGS Sales Associate application offers enhanced inventory visibility and when this visibility is delivered directly to your associate s mobile device, your goods are always in the right place at the right time. And it uses an interface with a simple, clean, intuitive design with familiar functionality and navigation, so there s no need for extensive training. The SGS VISION Retail Platform is an integrated, cloud-based solution seamlessly connecting item RFID tags, sensors, gateways, and videos to deliver actionable customer and inventory insights. Together, the SGS Smart Fitting Room and Sales Associate applications enable retailers to offer a superior shopping experience and increased inventory visibility that ultimately lead to improved customer satisfaction, reduced costs and increased revenue. 10

11 Digital doesn t only mean online BT s Information and Communications Technologies (ICT) prove digital innovations are not just for online stores. Rather, they help personalize the customer experience at brick-andmortar stores and make shopper visits more engaging and attractive, as well as increasing the operational efficiency of retailers. Working on a pilot program with Gallerie Commerciali Italia, an owner and operator of 43 shopping centers and six retail parks across Italy, BT provides a range of ICT infrastructure services, customer relationship management (CRM) and instore solutions to prove how digital technology can grow the appeal of retail spaces and provide new business services to retailers, as well as offer an enhanced omnichannel customer experience to consumers. Underpinning the digital transformation project is a BT network, providing fixed and wireless connectivity, empowering Gallerie Commerciali Italia to use the network to control and bring together data from digital devices throughout its malls and to provide free Wi-Fi for shoppers. The big data gathered by the network is then analyzed and used to offer services to retailers to help further enhance their shopping experiences, offering the same ease and customized convenience of online shopping and true integration with the digital world. Digital transformation projects involve a range of in-store multi-sensory solutions, spanning sight, sound, smell and touch, and aim to change how shoppers and retailers interact within stores, offering new ways to engage and communicate using smart screens, mobile devices and in-store radio, and even scent diffusion. 11

12 Protecting your business, your brand & your shoppers Today s global economy not only brings forward tremendous opportunity, but tremendous threat as well. Left unchecked, merchandise theft, counterfeiting and product diversion the sale of products in unauthorized locations can be costly and have long-term, damaging effects on a brand. Moreover, with each added digital service including RFID inventory management processes and systems - empowering shoppers and employees, new risks of threats and attacks are exposed. Across the entire retail environment, hardwareassisted and software-based security guards IoT cloud connections and provides multi-layered data protection. Fully integrated solutions from the Acuitas Digital alliance protect consumer and customer data, manage risks, and prevent threats to business disruption, data, finances and brand reputation. 12

13 About Acuitas Digital The Acuitas Digital alliance, consisting of member companies BT, Intel, RetailNext, Nexgen Packaging, SATO Global Solutions and Valmarc Corporation, is a first-of-its-kind endeavor providing integrated, secure, cloud-based and future-proof solutions for retailers to take real-time advantage of big data and the Internet of Things to optimize operations throughout their entire supply chain while better engaging with shoppers. The Acuitas Digital alliance suite of solutions provides the right mix of infrastructure, mobile technology, applications and hardware, empowering retailers to better engage with customers and optimize operations from merchandise production to shopper purchase and beyond. About RetailNext Recently honored by Entrepreneur Magazine as the number one ranked company on its 2016 Entrepreneur 360 List, RetailNext is passionate about retailing and empowering retailers to become better retailers, growing revenues and profits while delivering a differentiated shopping experience that increases shopping retention and loyalty. Please join the #SmartStore, #retail and #inspiringretail conversations on and visit the RetailNext site at retailnext.net. If you d like to speak directly to someone at RetailNext, please Contact Us. 13