By Rick Gretsch, Accelerated
Concepts, a Digi International company
In our recent study “The Cost of Downtime: Beyond the
Bottom Line,” 72% of midsized retailers lose sales
during network downtime. The study also finds downtime severely impacts
customer loyalty, employee productivity and overall business operations.
Retailers are ramping up the use of new IoT technology and a
growing number of connected devices to keep up with consumer demands, better
interact with customers, conduct transactions securely and improve the
efficiency of their operations.
Beyond what the customer sees and experiences, such as in-store
interactions with the brand using WiFi, there is a critical connection to back
office operations, often referred to as a backbone, that connects devices to
each other and to backend operations to fully leverage the advantages of the
IoT. One of the common examples of this backbone is the connection from sales
and POS systems to inventory control systems.
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Retail markets require robust IoT applications where
pervasive connectivity is a must, and where a fully developed backend ecosystem
allows organizations to effectively and efficiently conduct business. Key to
the technology backbone and backend ecosystem are routers and other networking
equipment, not the most glamorous part of retail but indispensable nonetheless.
It’s critical that routers designed specifically for the IoT
ensure business continuity in the event of a connectivity outage and provide a
connection to in-store third-party vendors operating ATMs, kiosks and other
conveniences.
What Customers See
ATMs have been in place for decades, with increasing
functionality from year to year. Kiosks are becoming more popular, driving
revenue and leveraging partnerships with third-party vendors inside the store. Digital
signage is making strides as more retailers embrace their capabilities to
deliver advertising and other customer communications more easily and
cost-effectively.
In the past, retailers would let third-party vendors use
their networks, because vendors had difficulty getting connectivity in a
facility they didn’t own. The days of allowing third parties to leverage
in-house proprietary networks are over, and an alternative is now needed. The
good news is that it can be provided via purpose-built routers and other IoT-specific
equipment.
Housing this equipment in a secure location such as a back
room or closet can disrupt signals and connections, so it often can be disguised
as a wireless access point, with neutral colors and separate power supply.
What Customers Don’t
See
One
of the most important benefits of today’s retail networks is continuity and
failover. A large retailer will likely have built-in redundancy and
conditioned lines. But mid-size to smaller organizations generally use
broadband connections, which provide significant bandwidth at low cost, but are
difficult to restart after a failure.
An in-store router provides a wireline connection that can switch
over to a wireless LTE connection in the event of an outage. It is a cost-effective
way of insuring that the back-office connection remains intact. Typically, a
metered service from a carrier isn’t ideal for long-term, since it’s more
expensive, but it nevertheless provides an excellent backup. Some retailers
will employ wireless LTE when first opening a store, since it can be installed
quickly, then switch over to wireline for their primary connectivity.
What to Look For
Here
are things to consider when implementing retail IoT technology to ensure a
reliable network and avoid overbuying.
- Constant
Uptime –
Any loss of connectivity can cause loss of revenue and even loss of customers.
Systems and services need to be constantly available, so choose a router that provides
maximum speed with flexible options, such as the ability to switch to wireless
LTE. - Security – Since
most retail transactions are purchases, high levels of data security and
encryption, including PCI compliance, are critical. Most solutions will come
with a device security framework that addresses common security vulnerabilities.
This assists with customer data protection and privacy regulations. - Remote
Management
– ATMs, kiosks and similar technologies are often spread across a broad
geography, so look for a solution that provides a local user interface so
third-party vendors can monitor and adjust routers without costly site visits. - Room for
Growth –
Choose a system that allows for easy deployment and management for wherever
your business grows. Many have the capability to provide connectivity
throughout the U.S. and Canada, and even around the world.
As with most technology, behind-the-scenes equipment
connecting a variety of hardware and software is crucial. These backend
applications and services provide the linkage between customer-facing
technology and the processes that must occur in order to deliver the technology’s
full capability for the business.
The
IoT can considerably enhance the retail industry, with millions of increasingly
sophisticated transactions relying on technology every day. As the Internet
handles more traffic and retailers further leverage the IoT, the technology
backbone will ensure efficient operations and positive customer experiences.
Rick Gretsch is
currently vice president, product management cellular
networking at Accelerated Concepts, now part of Digi International. Prior to joining Accelerated Concepts, Gretsch
held product management leadership positions at AT&T’s business
and consumer divisions and at IBM’s Global Network. He earned a
BS from the University of Arizona and an MBA from the Mendoza College of
Business at the University of Notre Dame.
