he retail industry isn’t easy to survive in. Ever-growing competition, technological disruption, and rising costs can bog a business down. Moreover, customers today are tougher to please and trends sometimes impossible to predict. With this climate, it is obvious that the retail industry needs to evolve.
This evolution has arrived in the shape of the Internet of Things (IoT). Focused on creating a seamless customer experience, IoT is driving Retail 4.0 - an integration of offline and online point of sales (POS) for offering customers a smooth shopping experience across channels.
How IoT will solve POS challenges
Presently, POS systems face multiple issues such as:
Inconvenience:A POS failure means customers must withdraw cash to complete the transaction Security issues:A security failure may leak sensitive customer information Low business efficiency:Poor network connectivity often causes delays and errors Unhappy customers:Poor connectivity results in slow transactions, increasing waiting time at the counter
Today, POS devices are no longer limited to being payment processing tools. They are fast evolving into databases for valuable customer information insights. To evolve into a valuable component of Retail 4.0, POS systems will need IoT connectivity. This will enable them to drive inventory management, supply chain management, and customer relationship management apart from generating big data analytics that retailers can use for targeted marketing and sales campaigns.
Given the competitive and dynamic retail landscape, IoT-enabled POS solutions will lead the Retail 4.0 revolution. The union of POS and IoT will produce a faster and more streamlined shopping experience. How will IoT change the POS system and its capabilities in the future?
IoT-enabled POS systems will eliminate the need for retailers to manually keep track of inventory, reducing the losses arising from storing excess or inadequate inventory. Automated IoT inventory management will enable real-time tracking at the POS system to provide a real-time view of goods in stock, generating data for analytics to predict inventory requirements. As IoT blurs the line between online and offline, it will become easy for retailers to stock products based on purchase trends. Furthermore, IoT will allow for faster stocking as sensors will detect stock, ensuring variety and product availability in stores.
Radio-frequency identification (RFID) is leading the IoT revolution in retail systems, allowing for end-to-end inventory control, smooth tracking of goods through purchase, and eliminating the need for barcode scanners at the register. RFID in POS can further allow for charging to a customer’s card via smartphone before they leave the store.
Beacon advertising or in-store smartphone marketing is fast gaining traction - wireless devices transmit signals to shoppers, beaming coupons and other offers to their smartphones as they browse through goods. Using IoT and POS technology, these instant discounts and offers can be personalized according to the shopper’s buying habits and behaviour, thus increasing sales.
Mobile POS systems
By bringing IoT-enabled POS system such as wireless systems (for transactions and scanning) to the customer on the sales floor, retailers can boost sales. Such systems make quick customer assistance and remote inventory assessment for size, color etc. possible. The attendant IoT technology tracks parameters such as pricing, inventory, discounts etc., assisting in the completion of the transaction.
Retail 4.0 will see retailers integrating their offline and online sales via IoT-enabled POS such that customers can shop online and pick up in the store or vice versa. This trend is growing stronger as retailers realize that customers now use stores as real-world catalogs, sizing up goods before looking online for a better deal. In this way, retailers will lose fewer sales. To take care of the higher inventory tracking, IoT will be deployed to scan goods at delivery and payment, log the transaction, update inventory and notify the consumer by email.
Retail 4.0 is already here
Already, Retail 4.0 can be seen in action in supermarkets and restaurants with self-service counters, advanced POS systems, electronic ordering service etc. In Shanghai, the famous French supermarket chain Auchan has inaugurated two new stores with no cashiers or shop assistants - customers enter and purchase products via their mobile phones.
Amazon’s revolutionary services are already making inroads. Amazon Go’s experimental store in Seattle allows customers to buy goods and pay for them with their smartphones. Their smartphone app does it all – from recording entry to scanning products and making the transaction. AmazonFresh Pickup allows users to order grocery online and pick them up in-store as fast as 15 minutes later. Clearly, a point-of-sale retail is already underway. Retail 4.0 stores such as Amazon Go would shift point-of-sale purchases to e-commerce wherein customers would be making transactions with their smartphones instead of swiping cards.
Changing the POS game with IoT
Retailers will need to rapidly innovate to respond to market changes. After moving from a multi to omni-channel experience, the industry will now need to fully integrate point of sales and touchpoints to create a personalized shopping experience across channels.
As retailers adopt new POS strategies, they will generate a wealth of data that will yield new insights into customer behaviour, inventory, pricing, sales trends and more. Clearly, the retail industry is poised to be disrupted by technological innovation. Retail 4.0 is the way forward for points of sale systems.