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Retail 2.0: Invite Shoppers To Participate

Once again this year, the ol’ Javits Center in New York hosted retail folk from across the country. It seemed as if every vendor was hawking technology solutions to help retailers track product life cycle from factory to sale.

This is a wonderful efficiency goal. Booth after booth showed space-age integration of serialized data from RFID tags, embedded into product tags, containing business information from back end systems. Track a sweater from factory to showroom to purchase and possibly customer return. Allow retailer micro-visibility into order status and inventory.

But some of the vendors are missing the full story. It was as if they ended the story mid-pitch. The industry still is selling First Generation Retail, when the new frontier is Retail 2.0.

Using the new Near Field Communication NFC-enabled phones that are entering the market this year, the shopper can be as active as the  merchandising clerk. Using the phone as a personal reader, shoppers can navigate products, allowing stores to clientele and close the cross-channel disconnect that is evading most store executives.

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Retailers need to allow shoppers to participate. Retail 2.0 is about opening up the stores’ business information to the consumer.

Retail 2.0 Is About The Shopper

The Amazon cloud abruptly entered the mall this holiday season, rudely disrupting retail sales. Shoppers increasingly have begun to rely on their phones to compare prices and investigate product information. Book, electronic, apparel and shoe stores all are working on strategies to become more relevant to this digital consumer.

Gone are the days when the consumer relied on the sales clerk for information; In most stores today, the “blue shirt” has inferior access to technology compared to the average iPhone swaggering shopper.

The iPad clienteling we saw at the Epicor and GlobalBay booths is all the rage. And this does solve some of the retailer’s problems.

However, how can we intercept the lone wolf shoppers before they are poached by Amazon through the PriceCheck App (or soon to come Kindle Fire 4G devices) that are designed to be in-store mobile commerce tools. (What Amazon calls “pro-consumer” solutions.)

What to do?

It All Starts With Electronic Smart Tags

RFID or Radio Frequency Identification and standards-based serialization emerged in the late 90’s. Walmart has been the main driver of this technology: the retailer wanted a system to track inventory from jeans through to jelly. Walmart worked to establish the Electronic Product Code (EPC) Information Services specification in 2007 and began to mandates its suppliers to attach serialized RFID smart tags to each product.

Smart tags allowed Walmart to see the movement of products through the supply chain, from their own distribution center into the back rooms at the individual retail outlets, onto the shelves and into the baskets. They permitted better replenishment decisions, inventory decisions down to the product (Acme Black XL sweater) and then deeper to the individual item (Acme Black XL sweater number 457988)

But the RFID smart tag solution has wider applicability. The following various industries presently champion RFID solutions:

  • The retail industries chase RFID solutions to track and trace products;
  • The law enforcement sector uses RFID to detect and prevent counterfeiting; and
  • The banking industry looks at RFID (coupled with NFC) to design digital wallets.

However, one shopper application cuts across all these enterprise solutions: The new NFC-enabled phone, which can be used for these applications:

  • Explore information on the product (track and trace);
  • Verify that a Prada bag is authentic (counterfeiting); and
  • Receive an offer on the product (wallet).

If retailers design their backroom inventory systems to allow for shopper-side access, every product with a serialized RFID tag would allow for this smart shopping experience.

The shopper simply could tap the tag with their phone to open a browser window to access product information, product authenticity validation, and the all-important wish list and CRM engagement.

This is without downloading an app, using a QR code reader or even texting.

In a world where the retailer needs to count clicks to commerce, using existing merchandising solutions allows for simple shopper engagement and the ability to drive path-to-purchase without clustering the aisle with dangling shelf talkers.

CIOs and CMOs need to get into the same room and work out a strategy to hand-off from enterprise to shopper marketing. Using the Electronic Product Code (EPC) specification, the retailer can both track and trace products within and beyond enterprise boundaries.

The CIO is developing a data repository to store events associated with uniquely identified products and associated business information. Let shoppers into this repository. Give shoppers access to explore information on the product with the tap of their phones.

Gary Schwartz is President of Impact Mobile and author of “The Impulse Economy: Understanding Mobile Shoppers & How They Buy,” published by Simon & Schuster.

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