Tech helps retailers get ahead
In retail, businesses use technology to reach consumers in several ways. While retailers have used cutting-edge technology for a while — think virtual fitting rooms or in-store augmented reality experiences — not many have used tech in the pursuit of cutting costs to battle inflation.
Here are some examples of how retailers today are taking advantage of technology to keep existing customers and bring new ones in.
1. Smart shelves
Using AI and real-time data, stores can keep track of the inventory on their shelves at any given time using smart shelves. As a wireless inventory control system, smart shelves use weight sensors to indicate how much product is on store shelves. The sensors then relay this information to the retailer’s customer experience (CX) platform. This data can be used to keep a balanced inventory and track shopping trends across multiple stores. Retailers can then adjust their inventory to better meet demand, avoid overordering and keep items they know are profitable in stock. This can cut costs and streamline inventory management.
2. Frictionless checkout
With frictionless checkout, consumers can use technology such as tap-to-pay, digital wallets and in-app payments to make their checkout experience faster and easier. Frictionless checkout can help retailers cut costs on labor and improve the customer experience by avoiding lengthy lines, especially for customers only purchasing a few products. A common concern of removing a human employee from the checkout process is fraud and theft. However, computer vision-based sensors can identify individual products and tally the price for a customer. They can also detect concealment or label switching.
3. AI and IoT
Many retailers have embraced the use AI and IoT as they look for new ways to attract customers. Both technologies are used to increase personalization of smartphone apps and marketing campaigns, as well as to create better online shopping experiences. AI also provides retailers with the ability to use predictive analytics to help forecast customer purchasing habits, while showing users personalized products and services.
4. Digital twins
A digital twin is a virtual representation designed to reflect a physical object or process. Retailers use digital twins with AI and machine learning (ML) to create sophisticated, virtual simulations of supply chains. Businesses can update models with real-time and real-world data, which helps analyze supply chain systems and identify possible problems before they become reality.
As the AI and ML systems learn, better simulations help predict consumer behavior, analyze inventory and shipping data, and perform supplier stress tests. This helps retailers save money by discovering and addressing potential issues before they happen, while adjusting quickly to market changes.
Robots and automation continue to cut costs
Robotics and automation can help reduce certain business costs. With self-service checkout lanes at the grocery store or robots sorting through inventory at a warehouse, these technologies continue to be go-to investments to help some businesses reduce costs. But with rising labor costs, there’s an opportunity to increase automation and robotics adoption to offset this trend.