By Jason Kay, CCO, IMS Evolve.
Technology investment within food retail is predicted to increase by 3.6 per cent within the next 12 months and, according to Gartner research, similar growth rates are expected over the next two years.
The retail sector has historically been tentative in embracing digitisation, however, with growing customer demands for a more efficient and effective service, alongside increasing pressure to reduce waste and consider environmental impact, retailers are acknowledging they must evolve to meet demands.
The Gartner study indicates that software is one of the fastest growing technology categories in the retail space, in terms of digital spend. Tools such as customer behaviour analytics and interactive mobile applications are enabling customer insights to inform an enhanced customer-centric environment.
Furthermore, adoption of innovations such as pay-in-aisle technology, facial recognition and digital signage are delivering a rapid, personalised service through frictionless retail and are enabling progression towards the end goal; an optimal customer experience.
However, whilst the predicted levels of technology investment in the retail industry are encouraging, and customer-facing initiatives are a positive step towards an improved customer experience, this progression should not undermine the importance of transformative technologies that work behind the scenes. Integrating such solutions into an organisation’s digital strategy can ensure evolving customer needs are met, whilst subsequently delivering multiple cross-business wins.
IoT in food retail
In a food retail environment, an IoT solution can provide enhanced visibility and enable real-time monitoring and management of vast refrigeration estates, achieved by layering IoT technology over existing infrastructure and systems, leveraging the data that already exists in the environment without costly investment in new sensors or machines – an attractive and scalable proposition for retailers that require minimal downtime and barriers to adoption.
Enhanced estate governance will ensure optimal temperature and asset performance through automation, critical prevention and automated corrective action. Through cross-organisational alignment, such as integration to the merchandising systems, individual refrigeration units can be dynamically cooled to the optimum temperature for the contained produce class, as opposed to the conservative cooling strategies currently adopted that result in mass overcooling.
A produce-led approach to temperature management improves quality and aesthetics through enhanced flavour, colour and texture and will allow retailers to deliver high quality, safe products with an increased shelf life – all valued consumer requirements that will enrich the shopping experience, ultimately increasing basket size and return business.
However, IoT technology delivers more than improved food quality alone. By ensuring the aesthetic, safety and longevity, the quantities of food being unnecessarily discarded by retailers and consumers can be dramatically reduced as a result; it is estimated that increasing the shelf-life of a product by just one day alone could result in avoidable waste being reduced by 5%.
Furthermore, enhanced temperature controls will prevent the unnecessary over-chill of refrigeration units, mitigating excessive energy consumption and considerably impacting retailers environmental footprint. With 71 per cent of consumers stating they consider the environmental impacts of their choice of food and grocery retailers and products, generating a more sustainably conscious store is paramount to meet this growing consumer concern.
Proven and scalable IoT solutions generate rapid ROI and release tangible value that can then be reinvested back into the business, subsequently enabling retailers to deliver higher quality products at the best possible value for customers; a vital combination required to gain competitive advantage and increase market share.
As well as the customer gaining a better product experience, with an IoT enabled, highly automated, efficient store, staff are available to provide customers with the service they deserve, rather than running around de-merchandising faulty cases or wiping up melted ice. Alongside a holistic IoT solution that dynamically monitors and manages the HVAC and lighting assets, the store environment can be transformed to enhance the customer experience from the moment they arrive to the moment they leave.
Embracing Innovative IoT technologies as part of a complete digitisation strategy can address bottom-line business demands in tandem with ever-evolving consumer needs. Saving costs, reducing environmental impact and improving operational efficiencies are all quantifiable business benefits that are delivered in addition to a vastly improved store and brand experience that will allow retailers to stay one step ahead of growing demand and expectation..