How Technology Can Improve Retail Execution
When you spend months designing the perfect display, you need data to ensure your stores have executed your strategy correctly. Technology gives you the data to increase your visibility, measure results, and act on them. You can then use this data to boost your operational efficiency and revenue by addressing phantom inventory. This article examines how technology can improve retail execution, from monitoring planogram compliance to optimizing on-shelf availability (OSA).
What In-Store Retail Execution Means Today
In-store retail execution relies on a few key performance indicators (KPIs), including on-shelf availability, inventory accuracy, speed-to-shelf, and planogram compliance. These metrics help track the effectiveness of a retail campaign.
Crucially, these metrics also help you connect the retail execution to measurable outcomes. By using technology and data, you can track and improve planogram compliance. Tracking how well stores have adhered to your planogram allows you to calculate the effectiveness of the sales strategy behind your campaign. For example, for every 10% improvement in compliance, you may have seen a 2% boost in sales.
Modern retail execution means digitizing stores and moving operations away from subjective, manual checks to objective, data-driven analysis. Having real-time data means retail operations executives and store managers can act quickly to resolve any roadblocks. Rather than having to check every shelf in the store manually, technology pinpoints issues.
Digital stores become a single source of truth for store conditions and task status, making it easier to standardize execution across hundreds of stores. Technology can also help reduce check-ins and give staff the data they need to complete tasks efficiently.
Key Technologies in Retail That Upgrade Execution
Here are a few key technologies that support retail execution:
- Computer vision: Computer vision and image recognition can automate shelf monitoring. By using cameras and AI, the system can detect out-of-stocks, pricing or signage issues, and planogram gaps throughout a store. You receive alerts much faster than physically walking around the store. It also reduces the need for manual audits.
- LiDAR mapping: LiDAR helps create accurate 3D store maps to confirm the precise placement of fixtures and displays in your space. It can also support remodels, resets, and ongoing compliance checks. The accuracy of LiDAR helps ensure the planograms you send to each store will actually fit.
- Retail dashboards: Using retail dashboards can keep clear communication between stores and HQ. With role-based views, each store department can see a list of priorities that are relevant to them. Dashboards reduce noise and data overwhelm and help focus labor where it is needed most.
- Data integration: Connecting all data sources enhances visibility from the warehouse to the store to the shelf. When an item sells on the shelf, the data is passed on so that an order for replacement stock can be timed to arrive exactly when needed.
How Technology Improves In-Store Execution Outcomes
Phantom inventory costs the retail industry around $1.7 trillion a year. Technologies such as perpetual inventory and shelf intelligence, enabled by computer vision, can help address this issue. Using these technologies together helps identify mismatches and maintain a single, central data source for stock levels. Having a single source of information helps boost OSA and prevents hidden overstock in backrooms.
Using predictive technologies can allow you to forecast demand, helping you replenish stock proactively and keep high-selling products in stock. For items with longer lead times, you can improve speed-to-shelf by accurately forecasting when the stock is needed. You can also keep storage spaces stocked with in-demand products, rather than holding too much slow-selling stock.
Tracking planogram compliance can be a time-consuming task. But with image recognition, monitoring compliance can be completed more quickly and at scale. You can even measure shelves continuously rather than periodic walk-throughs, which helps rectify issues more quickly.
Additionally, if a system identifies 50 errors in a store but a representative only has one hour, the dashboard can rank the most important products to restock based on lost revenue.
LiDAR mapping can also evaluate the profitability of displays and layouts. You can overlay sales data onto the 3D model of the store to identify the most profitable areas, or where high-margin impulse items perform best. By creating a digital twin of the store, you can A/B test layouts before implementing the best version in physical stores. This process can save time and maximize sales.
Best Practices for Rolling Out Technology in Retail Stores
You can invest in various tools, but consider setting one or two priorities to carry out a pilot. Prioritizing allows you to test the technology against the challenge you have. Prove the value of the technology you choose to implement first.
When implementing new technology, you’ll also need to work with staff to ensure a smooth transition. One way to do this is to design workflows that reduce more arduous manual tasks. Rather than seeing new tech or apps as more work to learn something new, frame it as eliminating those more frustrating manual tasks.
Ensure your facilities can handle the additional demands of any new technology. For example, ensure the store can support the bandwidth for 50 extra cameras to stream through the internet. Also, factor in how you will integrate any new systems into your operations and schedule downtime appropriately to transition.
When introducing a new dashboard for stores to use, ensure that there is a clear hierarchy and escalation path for any delegated tasks. Determine which staff members can access various parts of the system.
FAQs
Here are some of the most frequently asked questions about using technology to enhance retail execution.
How Can Technology Be Used to Improve Customer Service in Retail?
Computer vision and AI can help improve customer service by reducing time-to-assist. Staff can help customers directly with the time saved from automating manual tasks. Technology can also help prioritize the most pressing customer experience issues. Solving out-of-stocks is key since 70% of consumers may switch retailers if they can’t find the product they need.
Computer vision helps improve OSA. It can also ensure that pricing is correct, preventing price-related queries at the customer service desk.
How Does Technology Help in Retail Management?
Centralized dashboards can help retail managers keep a clear overview of their stores, including monitoring planogram compliance in real time or allocating labor effectively. Crucially, managers can work at scale, with digital twins saving significant time compared to visiting each store in person.
What Type of Technology Would You Recommend for a Retail Store to Improve Its Marketing and Why?
Ensure the display you paid for is the one the customer sees. Start by implementing shelf intelligence such as image recognition and LiDAR mapping. These technologies enhance your visibility, making it easier to execute your promotions according to planograms. With proper placement, you can then evaluate the success of the marketing campaign without having to guess at phantom inventory losses.
Experience the Driveline Difference in Retail Execution
Whether it’s improving speed-to-shelf or eliminating phantom inventory, technology can boost the efficiency of your operations. It is also important to have the skilled labor you need to implement any new systems and fix any issues during your day-to-day operations.
Since 1999, the largest retailers and brands for bespoke retail solutions have trusted Driveline. Our full-stack services close the loop by providing you with the technology you need and access to our national team of 15,000 trained W-2 associates. Contact us to explore how we can collaborate by completing a form.
