Keeping up with modern retail trends is a challenge in its own right, but the scale of transformation in response to the COVID-19 pandemic has redefined how customers interact with retail environments. The traditional shopping experience of grabbing an item of the shelf and paying at the cashier has quickly become only one of several options retailers have to engage with their customers. While the pace of change can seem daunting, the benefits of retail automation will touch nearly every aspect of your business.
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What is Retail Automation?
Retail automation may includeany section of your business where responsibilities are managed machines or digital processes.For instance, shopping carts serve as a familiar retail automation. Automation makes the process of storing and manipulating inventory data easier, improves supply chain management, assists with delivery notifications, enables retail managers to track performance more accurately and stores important purchase information for review. Frequent and accurate shelf data has become especially significant, as it does cannot rely on predictions from the past buyer behaviors.
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Examples of Retail Automation
Wherever an automated solution is implemented, regardless of the issue it is meant to solve, the solution needs to be concise, actionable, and consistent. In large part, since retail technologies are always evolving, retail automation remains an ongoing process for administrators who need to provide quality customer service that keeps pace with shifting demand. The automation of retail processes enable businesses to access data based insights more frequently, accurately and in real-time.
Point-of-Sale (POS) Systems
Automated POS systems are a fairly straightforward may use artificial intelligence technologies like machine learning to classify products based on buyer personas and provide shoppers with more accurate product suggestions based on pre-determined criteria. Retail POS systems allow store administrators to manage employee scheduling, track performance more accurately and easily, optimizing operations in terms of time and staff efficiency. For example, retail managers can schedule retail workers to work during shifts when they expect the most customer demand, mitigating labor costs. They can also keep a log of each transaction, with associated marketing data such as demographics from loyalty programs for further analysis.
Inventory Management
While it may seem like a simple innovation, inventory management software enables an automated means of accurately tracking existing stock and enables prediction for future demands. Tracking can range from individual to bulk units and provides a real-time view of product locations within the store. These systems synchronize stock count and location across fulfillment channels ensuring that staff are sent to the right positions to ensure order consistent order fulfillment.
Zero Contact Retail
Contactless in-store payments are becoming more and more common. The most popular example of this are grocery store or supermarket checkout systems that run programs enable scans each product’s barcode as customers place items in their shopping carts. It then processes the payment information and provides an updated price for each item while calculating its total. This process can be easily automated by integrating AI to avoid errors and ensure accurate calculations. Human operators will remain a vital part of this new retail format as they can educate customers about the benefits of each offering and assist with restocks or otherwise.
These environments are not limited to supermarkets. Micro-fulfilment can also be implemented in any store, enabling customers to make their selections across the store and complete purchases without needing to arrive at a cashier.
Supply Chain Management
Retail automation simplifies supply chain management by reducing the risks of human error. AI and other automation technologies can help retailers can provide more accurate stock projections, staffing and distribution needs. This enables retailers to use data-based insights to respond to sudden changes in customer demand.
Retail Marketing
Automation can be used through email marketing platforms that send out personalized emails promoting products based on customer purchasing decisions from other websites or vendors. Automated in retail marketing can also include email receipts, personalized recommendations, abandoned carts, and customer retention campaigns. Other uses might include accounting, bookkeeping, and payroll through automated billing and payment processes.
Robots
The most compelling use case for in-store robots can be seen in Walmart, where robots have been deployed in approximately one thousand stores. They able to perform basic repetitive manual tasks while continuously scanning shelves and alerting staff of low stock. At the same time, they can assist in automated fulfillments for online orders, monitor theft, perform cleaning and sanitation tasks, restocking activities, and assist customers.
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The Need for Retail Automation
Few industries have witnessed such a dramatic shift in customer preferences and demand as the retail industry over the last 2 years. The disruptions of supply chains have had wide reach consequences of their own, but many businesses have also had to toss out legacy data about buyer preferences as customer behaviors have shifted entirely.
Many business have had to scramble in efforts to enable omnichannel support and online ordering for at home delivery. According to IHL Group, out-of-stocks witnessed throughout the pandemic caused by the surge buying, emptying of aisles, and consumer turn to online ordering options have already cost grocery retailers an estimated $76 billion in lost revenue.
Consumers are looking to avoid these problems with an automated retail processes. Overall, businesses that had an effective e-commerce strategy in place were not affected as badly by the pandemic as other traditional retail businesses.
When implemented effectively, retail automation solutions not only translate into more sales and reduced costs, but can benefit businesses attempting to quantify how their consumer’s preferences have changed. Furthermore, 66% consumers believe implementing automation can solve challenges such as long checkout lines, and 46% are willing to shift their online purchase to an automated retail store.
Retail Automation Trends
As is the case with many industry sectors, the COVID-19 pandemic has brought about a transformation in how retailers engage with their customers. Throughout the pandemic around 56% of customer have shopped with different retailers. Furthermore, e-commerce sales during increased by 32.4% and sales in traditional brick and mortar locations decreased 3.2% in 2021.
Omnichannel Support
The massive shift in customer behavior and demand mean that the traditional shopping experience should be one of several channels for engagement. People are now more likely to expect that they can shop on their phones through mobile apps, and omnichannel support aims to meet consumers in the variety of virtual channels they may engage with. While expanding products and services to meet new demand, retailers should ensure they provide diverse delivery methods or curbside pick-up options. These channels ultimately will not replace physical locations, but will change how brick and mortar locations operate.
Personalization
As virtual environments become extensions of the traditional retail experience, businesses can leverage personalization tools to make each experience unique. For instance, the implementation of AI, VR, and AR can provide customers with a better experience while allowing businesses to better understand customers’ preferences and shopping behavior. When implemented effectively, these technologies enabled deeply personalized shopping experiences across channels, while helping businesses to better predict trends and changes in consumer behavior.
Micro-Fulfillment
Developed in response to the decrease in brick-and-mortar sales, micro-fulfillment (alternatively named hyperlocal fulfillment) leverages a similar automated storage seen in distribution centers, but on a much smaller scale. In effect, this allows retail locations to offer touchless restocking methods that ensure customers can consistently make their desired purchase. Micro-fulfillment automation improves the costs of order fulfillment while increasing the number of units per hour a store can sell. Investment bank Jefferies estimates this process will cut costs by 75%, compared with manual order picking. Furthermore, According to research and advisory firm LogisticsIQ, the micro-fulfillment market is expected to climb to $10 billion in five years, growing at a compound annual growth rate of 60% over that period.
Enhance Customer Experiences with Stefanini Retail Solutions
The variety of digital commerce tools available can bring dramatic transformation to your customer’s experience. Stefanini is ready to bring the latest and best digital tools needed to optimize your business.
Our team of experts will examine your processes and use their knowledge to find the technology that meets the unique concerns of you retail business. Ready to get started? Contact us today to speak with an expert!
