Hello and thanks as always for reading. One of the industries that has seen the most amazing technological changes over the past decade is the retail space. To many people, stores haven’t changed all that much....they are still a place to buy things you need. However, this industry has done a great job in using technology to improve the way that we shop, while finding ways to reduce costs and maximize profitability in the face of declining sales.
One common thing that I find (being that I work in the M2M field) is that the general public is quite befuddled by the term M2M.....it doesn’t register with most people. By showing how many of the things that they see each day in retail stores are powered by M2M solutions, it makes it easier to explain what I do for a living!
So, how has the introduction of M2M changed the face of retail?
Many of us remember the commercial (I think from IBM, drop me a note if I am wrong!) where it looks like a young man is shoplifting and about to be caught by a Loss Prevention officer, only to have the officer stop the man and hand him his receipt. This was definitely a forward-thinking commercial, as self check-outs and quick payment solutions have become commonplace in retail in the past few years. This cool feature is enabled by a few key components:
- First, there is some sort of scanning technology, whether it is traditional bar-code, RFID, NFC or Bluetooth technology involved to process the item and to total the purchase.
- Next, the transaction needs to be verified, so the information is sent across the Internet to have the financial portion of the transaction completed, whether it is charged to a credit or debit card.
- Finally, some sort of a receipt (whether printed or emailed) has to be generated.
To continue on the process listed in the scenario above, many systems do not stop there when it comes to automation technology. Real-time inventory management applications have become commonplace, to ensure that the shelf does not stay empty for long. The key facts of the transaction (which location, which item/SKU and how many) are instantly uploaded to an Inventory Management solution, which Inventory control teams use to make important, real-time decisions about the level of required inventory.
There once was a time when the only thing that you were able to buy in vending machines / kiosks was junk food and questionably fresh coffee! Now, vending machines are becoming mini-stores, thanks to many benefits of M2M! By increasing the value of the items that are sold in machines, companies had to take a few extra things into consideration, such as:
- Since these items are not “reactionary” purchases, the placement of the kiosk took on an entirely new level of importance. Vendors needed to be able to place the machine in EXACTLY the correct spot based on expected foot traffic, without necessarily thinking about the location of the nearest landline.
- Inventory management became much more important, as the financial impact of a loss is much more on a $200 set of headphones vs. a can of pop. It also became more important to refresh popular items, due to the possible amount of lost revenue when inventory is low.
- Since many of these items are not as reactionary and the demand is not as real-time as in the past (i.e. when you are thirsty, you don’t think twice about buying a drink, but you may think twice about buying headphones on the road when you have some at home), it was imperative that the proper advertising was done. This included the addition of Advertising terminal (see below for more details) and personalized service.
- Finally, a higher level of security is involved in these transactions, since many of them involved the use of credit or debit cards, something new to many vending machine vendors.
Wireless M2M solutions have provided these vendors with increased flexibility in placement of the units, a reliable and secure method of processing transactions and enough bandwidth to quickly send new video to increase traffic.
One of the fastest growing trends in the financial space is the explosion in the use of Credit and debit cards to complete transactions. It has now gotten to the point where fewer and fewer people carry a significant amount of cash on them. This had led to a dilemma.....how to retailers who are not able to use traditional landline services offer these payment options to their customers, and if they do not, will their sales suffer? Mobile Point of Sale systems have allowed many mobile vendors the ability to offer commonly used services to maintain / grow their business. It is now commonplace to be able to pay by credit or debit card for transactions such as home delivery services, taxis and flea/farmer’s markets. This has helped to continue the need for consumers to use their preferred method in more places, further strengthening the growth in credit and debit card use. This technology breakthrough only became possible when these solutions were able to use cellular networks that offered them the wide coverage areas, available bandwidth and high levels of security to process these transactions.
With the increasing growth of Credit and debit cards, it also increases the importance of having a reliable connection. As customers begin to carry less and less cash on their person, the likelihood of being able to complete transactions with cash during times when the network connection goes down become rare. Many companies are using high-speed wireless connections to provide a reliable and real-time backup for key Internet connections. Not only does it provide a great redundant connection for financial transaction processing, it is equally valuable to provide a backup for in-bound orders that may be received on the Internet. These include e-commerce transactions, as well as orders being received from the Internet, such as food orders and orders for electronics, that will be picked up at the retail store.
So, are M2M solutions only good once the consumer is in the store? Hardly, based on the incredible growth in Mobile Marketing, such as Digital signage, QR Codes and Bluetooth-based marketing. These solutions allow for much more focused advertising, as well as the ability for consumers to become “engaged” with the medium, through the desire to receive special coupons or the requirement to click on a link to see the message. These forms of advertising have proven to be much more cost-effective in certain demographics when compared to media that is all about one-way messaging such as static billboards, TV and print.
Finally, as a way to get to know their customers better (and to gain advantages over their competitors), progressive retailers are using intelligent video systems to study the pattern of customer traffic to better optimize displays and store layouts. Based on similar technology that airports have used to be notified about bags left unattended, retailers are noting the path that certain consumers take, the amount of time that they spend in front of certain displays and what parts they seemed to have the most interest in. This allows them to receive real-time information as to the effectiveness of a layout or display, and to make quick changes in minutes, instead of weeks.
As always, thanks for reading, and let Novotech know how they can help you with your M2M solution!