GUEST OPINION Mobile and IoT combine to create ‘the new retail paradigm’
The last great retail paradigm shift was the introduction of the shopping trolley. But that is all set to change with the combination of IoT and mobile, says Paul Winsor, Director of Market Development, Retail and Services Industries, Qlik
In the 1950s, Sainsbury’s, one of the UK’s largest supermarket chains, was the first retailer to introduce a paradigm shift to the way people shopped. It offered ‘Q-less shopping’ – a self-service concept that allowed consumers to shop the store by pushing a metal trolley around the aisles rather than waiting in line at a counter to be served.
While we couldn’t imagine completing our grocery shop without the trusty shopping trolley (for now), times have well and truly moved on. Last month, Amazon completely revolutionised the retail game
once again with the announcement of its new physical store concept, Amazon Go
. For consumers, shopping won’t ever be the same again, thanks to the blend of digital, IoT and mobile technology.Shopping at its most advanced
Amazon has created a new shopping concept with the introduction of the world’s most technologically advanced retail experience, which means that shoppers will never have to wait in line again. Enabled through the Amazon Go app, consumers simply enter the store, take the products they want and go! No lines, no checkout.
The convenience and ease of payment this will create for time-starved consumers can easily be imagined. Once adopted widely, this new technology-driven, physical store concept will shift retail into a new paradigm - pushing us away from the previously innovative concepts of self-service checkouts, hand-held scanners and mobile cashless payments. I believe this is the single biggest transformation to ever happen to retail - even including the online revolution of the 90’s.
The new consumer experience this concept proposes is hugely exciting – but it is not only consumers that should be excited. Retailers and the like should be thinking about how much Amazon will be able to learn about consumer shopping habits from the physical world of retail as well by using digital, mobile and IoT technology.The potential in IoT
A recent study conducted by Management Events
on the growth of IoT found that by 2019, 30% of organisations will invest in IoT as a technology priority – seconded only to analytics. When you consider the opportunities IoT technology is already presenting organisations from all industries – in healthcare, wearable devices that can track gut activity after surgery
are in progress, and insurance company Neos is using IoT and connected technology in the home
to monitor potential threats in real time – it is perhaps not surprising that IoT is becoming a top priority for investment.
The data collected by these devices will provide these organisations with never-before seen consumer insights, allowing them to tailor and target their business to the exacting needs of their customers.
In this instance, Amazon Go will be using IoT for its ‘just walk out’ technology, to automatically detect when products are taken from or returned to the shelves, and track them in a virtual cart based system, using IoT sensors embedded into their shelves.
This opens up the opportunity for Amazon to analyse with laser precision the shopping habits right from the shelf edge. From the order consumers put items into their shopping bags; the exact time (to the millisecond) items were picked off the shelf; which of their products have an affinity, how long consumers spent in the store, and the footfall journey they took to complete their shopping, organisations can understand their customers in better ways than ever before.
This is very exciting for the industry for three main reasons. Firstly, there are analytics platforms on the market that enable IoT data to be associated with other traditional data sources, which will help retailers discover new insights into shopping behaviour. Secondly, as the power of data analytics is put into the hands of all employees, those on the front line will be driving IoT innovation through self-service discovery being in the data. And finally, for IoT value to be realised, insights will be shared and acted upon across the whole organisation.
Retailers have been analysing market-basket purchases for many years now whilst continually trying to understand product shelf availability. But by taking advantage of IoT capability such as sensors, digital cameras and mobile technology, the industry is ready to uncover a much deeper level of insight.