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The Next Step in Your Store Analytics Strategy: Sensor Fusion

Retail has entered an era of unprecedented competition and accelerated evolution worldwide. Retailers in every category, both brick-and-mortar and online, face larger and more unpredictable threats than ever before, from digitization of goods and distributed manufacturing to autonomous, near-instant delivery, service robots, and online experiences with unprecedented realism, as disruptors such as virtual reality, 3D printing, drones and wearables take root.

While e-commerce growth is outstripping physical store expansion, the in-store experience is still a powerful part of the shopping experience. The Internet of Everything (IoE) offers new opportunities to make physical store shopping a better experience for the consumer and more lucrative for the retailer. By lighting up “dark assets,” retailers gains unprecedented insights into shopper behavior and operations, and can impact every piece of the value chain from merchandising and sales to workforce optimization, shopper experience and service.

Retailers light up dark assets by instrumenting physical stores with sensors and actuators such as Wi-Fi access points and shopping cart tags, beacons, video cameras, and even mechanical devices such as weight sensing shelves or humidity sensors. While these sensors themselves provide valuable new insights, often the greatest advantages are derived from combining multiple types of sensors and data through “sensor fusion.”

As just one example, pairing Wi-Fi location data showing a shopping path with point-of-sale data can highlight opportunities to improve conversion, where shoppers linger but don’t purchase. Likewise, combining video analytics of traffic entering the store with shelf sensing of the rate at which refrigerated goods are being picked up provides a more accurate forecast of staffing needs.

The business value of sensor fusion can be staggering – our studies show that a 1,500 store big box chain could save up to $100 million per year in cashier cost, at the same time as reducing checkout wait times by up to half – in fact, we predict that IoE could ultimately end up eliminating the checkout line. IoE also helps with the stubborn problem of on-shelf availability, where the largest retailers can lose more than $1 billion annually.

But that’s not all – sensor fusion is already being used to evaluate campaign effectiveness, optimize merchandising, and help suppliers and partners become the captains in their categories, as well as to reduce shrink and improve shopper and employee safety.

Please join us to learn more on Sept. 25 during my 45-minute webcast being held at 12:00 noon ET/9:00 am PT. It’s called “Why You Need Sensor Fusion in Your 2016 Retail Analytics Strategy,” and it’s jointly sponsored by Cisco and our partner RetailPoint, which offers POS solutions. I’ll speak for just half an hour about IoE in action in retail and the technologies enabling it, from video (the “supersensor”) to wearables to precision location and the single pane of glass for retail – the ultimate view of your business. Then we’ll spend 15-20 minutes in open discussion on how sensor fusion can help your store take the next step. Please register today!

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Determining the Value of the Virtual Shopping Experience

We are increasingly hearing about the value of improving the shopping experience by adding virtual expertise to the store. As head of Cisco’s Retail & Hospitality practice, I frequently talk to customers who are exploring this concept – though what I mainly hear are questions! While many are interested in the idea, they are still trying figure out whether or not a virtual customer expert is going to add more revenue to their bottom line.

Putting a collaborative expert into the store – virtual or physical – can actually be critical to meeting the needs of the consumer, especially during the purchase of a high-priced product or for a purchase where it is very important to make the right decision. However, very often this level of expertise is not available in the aisle when the consumer is dwelling there. And yet, the presence of such an expert can be extremely important. For example:

  1. A mother is shopping for an over-the-counter decongestant late in the evening for her child, who is also taking medication for ADD. A pharmacist is not available, but getting the wrong medication could be life-threatening.
  2. A couple is buying a printer for their college-age daughter, who shares an apartment with three other students. They need a printer that can be networked so all four girls can print their assignments and research papers.
  3. A party host would like to purchase several cases of wine that complement the menu, but are not overwhelmingly expensive.
  4. A couple is browsing the latest assortment of home security devices, trying to make sense of what will work with their current network configuration.

Savvy retailers debate how to solve the problem of providing highly paid experts to be immediately available to consumers, without footing the bill for an employee who may be idle part of the time. Additionally, it may be necessary to provide a level of privacy while engaging the expert. The retailer’s quandary is how to attractively offer this service in a way to increase basket and justify this use of valuable selling space.

Forward-looking retailers recognize that this capability is part of providing a truly integrated omnichannel experience. Shoppers are no longer either in the store or online… they are both, and sometimes at the same time. Thanks to our mobile devices, consumers can research, compare prices, and shop with our mobile devices in the aisle. According to Macy’s CEO Terry Lundgren, retailers need to adopt a “digical” strategy – a term coined by Bain & Company’s Darrell Rigby and Suzanne Tager – meaning the seamless integration of digital with physical retail. (For more, check out the article, “The Future of Retail Will Be Won or Lost in ‘Digical.’”)

In any channel in this digical world, retailers will lose revenue if they are unable to differentiate themselves by providing excellent value, combined with the appropriate amount of customer service. And here is where the virtualized experience can drive a new level of engagement for the brick-and-mortar store. Via video collaboration on a consumer’s mobile device, a kiosk display, online, or an associate’s tablet, shoppers looking for advice can easily connect with your centralized or outsourced pool of experts for immediate assistance. Let’s go back to the scenarios above:

  1. A QR code is posted on a sign that reads: “Photograph this sign with your mobile device and you can speak to one of our pharmacists on call 24×7.” The pharmacy service immediately calls the mother’s mobile phone number to discuss which medication will be safe for her ADD son.
  2. An associate in the printer aisle approaches the couple and boots up an expert session on his tablet to discuss feeds, speeds, and price points. This helps the family determine which printer will best fit their daughter’s needs.
  3. The party host approaches a kiosk to engage a wine expert. He enters the date and time of the party so that weather can be taken into account, the centerpiece menu items, and his desired price range. He then engages with a virtual expert who provides options as well as a special discount based on the number of cases. Additionally, he is offered a 50% discount on disposable wine goblets.
  4. As the couple browses an array of home security options, the retailer pushes a promotion to their mobile device: “If you would like a complementary home security assessment, follow this link to schedule an appointment with one of our specialists.” This in-home expert then cross-sells and upsells products from a tablet in the home, and schedules an in-store meeting when products arrive to discuss installation.

When used in conjunction with brick and mortar, virtual in-store and online expertise complement the natural selling journey with consumers to fill an important gap in the omnichannel experience. Click here to learn more about Cisco’s thinking in this area, or contact me at

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Enabling Retail Business Innovation With Threat-Centric Security

Last year was one of the biggest years for retail data breaches, with credit card data from well over 106 million shoppers stolen from two of America’s largest retailers alone. The attacks shook consumer confidence, eroded brand loyalty, and cost the industry millions of dollars.

Even though the retail and security industries have been talking about compliance and security for more than a decade, breaches continue. And while research shows that compliance with PCI DSS has improved in recent years, it also shows that staying in compliance as demonstrated by passing interim assessments is another matter. Furthermore, compliance doesn’t always equal security, as it tends to focus on blocking attacks at the perimeter. Stopping attacks in the first place certainly is important, but it isn’t sufficient in an era when attackers are innovating at a pace we’ve never faced before.

Read my blog here to learn more about how to create a hyper-relevant experience for shoppers at a time when security has become a driver for consumers’ trust. To dig deeper into the elements of a threat-centric approach to security, be sure to also read our new white paper, Enabling Retail Business Innovation with Threat-Centric Security.


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How to Make Your In-Store Data Meaningful

As an omnichannel retailer, you are probably offering your products to shoppers both online and in brick-and-mortar stores. And, like most retailers, you are no doubt collecting online data and running detailed website analytics that help you track preferred products, pricing, shopper behavior, ratings, and so on.

But are you able to gather these same detailed metrics in your physical store, telling you why shoppers choose your store over your competitor’s? How to create a better experience on the floor? Or optimize staffing? Most importantly, are they helping you increase sales?

Until now, the answer to these questions has been “No,” simply because the technologies to gather such metrics weren’t available. It hasn’t been until now, the era of the Internet of Everything, when edge computing is available to gather and analyze the data that gives you a 360-degree view of your store.

Studies show that in-store analytics is a key area of innovation, which may allow retailers to gain up to 11 percent in value. Today’s in-store analytics tools should be able to do three things:

  • Integrate data from multiple services
  • Automate data collection processes
  • Analyze data to identify actionable insights

With these capabilities available, you can use the power of your investments in mobile technology, social media, and in-store applications to collect – and understand – more and more customer information.

Join us for an hour on Tuesday, July 14 at 10:00 am PT/1:00 pm ET for a webcast on “How to Make Your Data Meaningful: New Strategies for Improving In-Store Shopping Experiences and Retail Operations.” This free one-hour session will discuss:

  • Which in-store metrics generate real-time recommendations to boost operational efficiency
  • How analytics can help you offer hyper-relevant shopper experiences and forge enduring customer relationships
  • Use cases that demonstrate the outcomes of connecting data to decision making

Register Today. We’ll see you there!

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The Internet of Things: Retail without Boundaries at Synergy

Last week I was in Orlando attending NCR’s Synergy Conference, which, this year focused on “Inspired Commerce.”  At the show I heard a lot of dialog with retailers and technology partners about how the Internet of Things and the integrated use of mobility in our day-to-day lives is changing how retailers engage with consumers. I addressed this topic in my session at the show, but wanted to mention a few highlights in hindsight.

First, the use of mobile devices during the shopping journey is no longer for millenials and early adopters only. They are certainly the heaviest users, but across the board in the US, 55% of shoppers are making use of retailer-specific applications, and 34% are using independent shopping apps such as Groupon, Zulily, etc. More than 40% of consumers want to receive their loyalty points/perks and discounts in real time, while shopping in the store, vs. receiving the same information in snail mail or in email.

Second, mobile is becoming integral to the shopping process. Retailers are facing demands for greater convenience, transparency, and interactivity with their consumer base that would have been unimaginable even a decade ago. (As a side note, this is extending into other industries as well, such as healthcare and financial services.)  Consumer expectations are evolving, and with this, retailers need to be able to offer new and effective engagement opportunities with their brand.

Other disruptors include fast-changing technologies such as social media use (not just Facebook and Twitter, but now Pinterest and Instagram) and the need to aggregate social sentiment data; unstructured data such as photos, posts, Tweets; and structured data coming from legacy systems such as CRM, SCM, and POS to make real-time decisions at the edge of the network – in the store or online where the rubber meets the road.

So – high volumes of structured and unstructured data, exponentially growing sophisticated consumer demands, and the growing use of mobile devices in the shopping journey. How does the retailer leverage all of these opportunities to make the most of this evolution?

With billions of connections, sensors and devices lighting up the Internet of Things, the aggregation of structured and unstructured data to deliver real-time analytics on mobile devices for store associates and mobile engagement via apps aimed at consumers, the opportunities are endless.  Retailers that can deliver hyper-relevance – which, according to Cisco’s research, is increasingly what consumers prefer during the shopping process – will be the ones who stand out.  Hyper-relevance delivers to me, the consumer, what I want, when and how I want it, in the context where I am at that particular moment.

To succeed in this new paradigm, retailers must earn consumers’ trust and deliver consistently as a brand to get access to the data that lets them provide a truly relevant real-time experience. Once consumers are willing to share a certain amount of personal data – at Cisco, we call this the “trust cliff” – retailers can use real-time analytics to turn that data into actionable insights.

We have identified three key attributes that retailers must possess to deliver hyper-relevance and build a dynamic infrastructure and processes:

  1. Hyper-aware: By implementing and automating edge technologies such as sensors, cameras, beacons, and RFID tags, retailers can capture value from the intelligence and automation that is now available to them. This is the way to begin to gain true visibility into what the customer is experiencing in the store, how they are dwelling in the store, where they need help with the shopping process.
  2. Predictive: By overlaying intelligence and analytics on top of these edge technologies, retailers can gain real-time anticipatory insight into what is happening, what to expect, and how to meet customers’ real-time needs. If retailers can more systematically determine peak timeframes and loyal customers’ shopping patterns, they can anticipate the staffing needs to speed up the shopping process and assist customers through the checkout process faster.
  3. Agile: Agile, solid infrastructures, adaptive business processes, and associate training capabilities are critical to being able to deliver the kinds of dynamic experiences discussed here. When business processes can change dynamically and associates trained to respond and do what’s best for the customer, all while leveraging technology and insights gained from integrated systems, the customers’ shopping experience can delivered in an excellent manner.

This is obviously not as easy as it sounds.  Implementing a hyper-aware, predictive, and agile network to respond to your customer demands is very difficult.  We in the Cisco Business Transformation Team work with customers to help them explore where they are today and where they want to take their business in the future, and work arm-in-arm with them to look at what it would take to get from where they are today to this desired future state.

We recommend the following steps:

  1. Forget everything you thought you knew about the digital consumer – all the old paradigms are melting away and “segmentation” no longer applies
  2. Go to the edge for visibility into what customers are experiencing at that moment
  3. Build a dynamic infrastructure and create agile processes that to support the customer experience
  4. Develop new business models that drive innovation and enable hyper-relevance

If you would like to download the white paper from Cisco Consulting Services that I’ve referenced, please click here.

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