The connected store is the next step in the digital transformation of the retail industry as the Internet of Things brings new sources of real-time and streaming customer data to store operators. New technologies are needed for these emerging frequencies and types of data, which has created an opportunity for Kx for Retail.
Kx is the high-performance database that sets the standard for time-series analytics, with a built-in expressive query and programming language. FD (First Derivatives Plc) has developed a suite of products for a range of industries including Financial Services, Telco, Pharmaceutical and Utilities.
The Kx streaming analytics platform is perfectly suited to analyzing large volumes of data in real time. Kx helps retailers make faster and more informed decisions based on what is occurring now, what has occurred in the past, and what is predicted to take place in the future.
With the ever increasing volumes of data that are being produced from sensors in merchandise and in stores, methods are required to capture, process and gain insight as quickly as possible. Questions such as: “which store layout works best?;” or “which products are our best sellers?” and “how can we ensure maximum product availability?” have always been asked, but now retailers can answer in real-time with Kx.
How E-commerce is driving the Connected Store Experience
It is well known that online shopping has dramatically altered the retail landscape. Many predominantly bricks and mortar retailers have suffered significant declines in customer footfall and spending; but they are fighting back. E-commerce hasn’t been able to completely replace the physical store, with studies citing the ‘inability to touch and feel a product’ as the main issue customers have with online shopping.
Physical stores are investing their energy in enhancing what they deliver best – a real and personal shopping experience, and the most forward thinking retailers are using exciting in-store technology.
Connected stores are physical premises which utilize a range of new technologies to interact directly with the customer. Concepts such as digital fitting rooms and interactive displays are becoming more prevalent, while technologies such as augmented reality, in-store tracking sensors and RFID tags are allowing stores to monitor customer behaviours in real-time.
How the Connected Store is working in the Real World
Amazon Go is currently in beta trials with a cashier-free app-based business model. At the first location in Amazon’s hometown of Seattle, the shopper simply walks the aisles placing any desired items directly into their basket then exits. The “Just Walk Out” technology tracks what has been removed from the shelves and by whom, then debits their Amazon account later in the day with the correct amount. This is a compelling value proposition for consumers, focused on ease and convenience, and a step change for grocery retail.
Another recent example of a technologically innovative retailer is Timberland, who opened their first connected store in January, in New York City’s Herald Square. Each product in the store is tagged, and when the product is tapped on a mini tablet, product information and additional details are displayed. The idea is to connect consumers’ online shopping habits with their in-store experience. In the future, Timberland plan to add additional features such as allowing users to view product reviews, add user-generated content about products, and watch styling videos.
In a previous blog we spoke about how the smartphone is becoming the primary means of online shopping. For French cosmetics giant Sephora, an early adopter of mobile technology to personalize the shopping experience, online shopping is a bridge to store-based apps that give shoppers direct access to product ratings and reviews. Sephora sees a significant opportunity in capitalizing on customers’ online habits by providing them a means to use their phones as a shopping assistant when they’re standing in the store.
Having immediate access to additional information and advice is extremely helpful. In fact studies have found that users of a retail loyalty app are more likely to visit the store more often and also spend additional money within the store.
The connected store business model is disrupting traditional retail practices around the globe. For example, rural village stores in China had been struggling in recent years due to the increase in smartphone use for online shopping, along with a declining local population due to migration, leaving a smaller customer base. This pressure has spawned innovation and new collaborations to provide much needed revenues.
Retailers in China are increasingly reaching small communities by using an army of postmen to turn village stores into the “world’s largest retail market,” according to Wired. E-commerce platform Ule, a joint venture between internet and media company TOM Group and the state-owned China Post, has undertaken”to index and predict the world’s retail behaviour [sic] while turning data into revenue.”
In the process, they are connecting rural stores and providing local customers access to the whole network. Each transaction made in a store is captured and tracked centrally. This allows individual retailers to analyze their customer base, connect to a wider market and grow their business by offering different goods or services that other stores do not. Individual stores can run promotions which are accessible across the group. This model gives consumers a familiar point of access to a wide range of goods, all of which can be checked and purchased through the local village store, or online via their smartphones.
The Right Technology for the Connected Store
With the growing data volumes being gathered through projects such as these, and as connected stores become more widespread, new modern solutions are going to be required to handle data being collected at never before seen volumes and velocity. Kx streaming analytics are perfectly suited to provide insight and answers to the big questions posed by this data, giving retailers the means to respond in real-time — allowing them to provide a better customer experience and increasing revenues.
By design, Kx solutions are quick to implement, easily scalable as data volumes grow and require a comparatively small hardware stack, orders of magnitude less than other big data competitors.
Kx provides optimal solutions for data storage, processing and analysis to drive optimized business decision making. Kx for Retail is designed to connect data across the full customer journey, enabling analytical solutions all in one place.
Kx® and kdb+ are registered trademarks of Kx Systems, Inc., a subsidiary of First Derivatives plc. You can contact their retail expert Tom Hill on: 07736 312165
To find out more about how tech and digital innovations are revolutionising the retail industry, at Digital DNA 2017 coming this June 6-7 to St George’s Market Belfast. Get your pass now!