Cut Shrinkage And Throw Out The Planogram With Mixed Reality Merchandising

0aaJaimy Szymanski Kaleido Insights

It’s rare that one technology set could solve retailer woes related to both merchandise theft and in-store planogram stipulations, yet virtual and augmented reality (VR/AR) offer promise in both arenas. Retailers are cutting shrinkage of high ticket-value items by displaying virtual versions that utilize mixed reality implementations, while other retailers are eliminating tedious planogram issues by employing AR to easily configure visual store layouts and signage – all in real time.

Walmart recently thwarted in-store theft by partnering with deviceless AR technology provider Spacee to install interactive product displays in five Texas stores. These displays showcase connected devices, like the Nest smart thermostat, allowing passersby to learn more about the products by engaging with the 3D touch screen displays. These endcaps have enabled Walmart to cut the risk of theft of real merchandise and lower costs associated with employee training, while still offering interesting product experiences and sharing features that can boost sales of pricier merchandise. In a video posted on Facebook, Walmart CEO Doug McMillon called the Spacee-enabled display “the future of shopping.”

Not only does mixed reality offer the opportunity to eliminate merchandise shrinkage, but it also lends the ability to explore product models more interactively, and with greater educational components, without the need for associate intervention. This not only reduces labor costs associated with updating displays of new products and time spent with customers, but it is especially useful for complex sales environments that require highly knowledgeable staff.


Take Accuray, a radiation oncology company that manufactures medical devices, for example. The company wanted a cost-effective way to demo large-scale products, the CyberKnife and Radixact. For a pharmaceutical trade show, Accuray partnered with Zappar to develop two 3D models viewable in virtual reality to display the unique features of the products. Not only did Accuray save in transport and production costs, but they were able to display the interior of the product for the first time. After the event, users could re-engage with the VR model via Zappar’s application technology, helping to further drive sales and brand awareness.

Finally, let’s consider the impact of VR and AR on merchandising and tedious planogram implementations that often leave employees working until the wee hours of the evening.

When configuring in-store layouts, merchandising managers typically rely on a hundred-page hard-copy manual that’s filled with confusing promotional display directions and updates that come in quicker than employees can keep up. By utilizing dynamically changing virtual product displays and signage, data feeds update products in real time. This frees up retail staff to concentrate on other, more pressing sales and service needs.

In a research interview that I recently conducted with Payscout’s Solution Engineer Brad Lenett, he expands on a future vision where “retailers that receive hefty weekly merchandising planograms could be updating displays with live purchasing data, fed into an AR or VR application. Whether considering demonstration or training, combining mixed reality with real-time data streams offers immersive experience opportunities for employees and consumers.”

Realizing the benefits of VR and AR in retail environments requires leadership to not only plan for the immediate financial impact, but also a future state where “deviceless” mixed reality offers even greater promise of efficiencies.

First, the short-term: calculate financial impact to make the case for mixed reality in-store. This goes beyond showcasing the flashy consumer-facing implementations by connecting enterprise goals to proposed proofs of concept. Getting internal support for a new technology implementation requires building a case that showcases either the benefits of shifting processes — or the risks of not doing so. For example, would the cost of your company’s VR training program undercut the cost of accident payouts? Look for the extremes, advises Zappar’s Jeff Ridgeway in another interview, “extreme cost, size, speed or danger offer the greatest areas of potential impact in innovative mixed reality implementations.”

Then, begin planning for the additional efficiencies that will be possible with “no device required” mixed reality. Futurist technology vendors are leading the way in touting the benefits of what has been called “spatial AR,” “deviceless XR” and “democratized AR.” These terms all describe the same future state, where mixed reality interfaces can be experienced without a phone, tablet or wearable device. This is especially promising when considering older generations and mitigating change management in adopting new technologies, as well as in group collaboration scenarios.

It’s an exciting road ahead for retailers looking to keep up with the immersive technology expectations of both their consumers and employees. Innovators are smart to consider mixed reality’s myriad opportunities to improve experience design for all audiences.


Jaimy Szymanski is analyst and founding partner at Kaleido Insights. She is a research analyst, author, speaker and advisor, focused on organizational change brought by digital disruption. Through her client relationships and research experience, Szymanski has worked in strategic advisory and planning capacities with many large organizations, including: Bristol Myers-Squibb; Enterprise Holdings; Facebook; Google; Hallmark; HBO; Intel; LinkedIn; Nestle; Ogilvy & Mather; and Save the Children International. Szymanski’s experience derives from both her work as an independent analyst and also through boutique marketing and research firms, including San Francisco-based Altimeter Group, where she focused on digital transformation and social business strategy.

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