The Future of Retail: A Q&A with Google Cloud, Part 1
Collaborating to drive retail’s digital transformation through Sensormatic IQ
Over the years, the retail industry has undergone a significant evolution. The digitalization of retail was a growing trend fostered by technologies designed to enhance retail operations and improve the customer experience. Today, the COVID-19 pandemic accelerated this digital transformation due to changing consumer shopping behaviors.
As the retail industry continues to evolve, it is more important than ever for retailers to tightly integrate digital and non-digital strategies. Sensormatic IQ, our new intelligent operating platform for retail, provides unmatched insights into areas including inventory, labor optimization, shopper behavior, loss prevention and liability, and more. Built on Google Cloud, Sensormatic IQ addresses the industry’s key challenges, and delivers improved shopper experiences and retail outcomes.
Amin Shahidi, vice president of strategy, alliances and M&A at Sensormatic Solutions, and Carrie Tharp, vice president of retail and consumer at Google Cloud, discuss the challenges and opportunities retailers are facing today, where the industry is going, and how technology, like Sensormatic IQ, can help retailers confidently move into the future.
What are the most critical challenges retailers need to address in a COVID/post-COVID-19 world?
Amin Shahidi: Shopping used to be a leisurely activity for people, part of their daily routine or a chance for discovering new products. While we are seeing a shift towards restored confidence, according to a recent Sensormatic Solutions survey, 34% of respondents are still concerned and 16% said they are very concerned to shop in-store. Restoring consumer confidence will be a challenge the industry must continue to address. As a result, retailers will need to embrace technologies to meet customers where, when, and how they want to shop.
For example, out of necessity due to the pandemic, a lot of shopping was driven to online channels, leveraging fulfilment options such as buy online, pickup in-store (BOPIS), and curbside pickup. While these convenient fulfillment options are here to stay, there are many shoppers who want the in-store experience of seeing and feeling the products in-person, interaction with customer service, and real-time access to what they need, when they need it. As consumers return to the physical stores to pick up an online order or to browse, retailers will need to be prepared to capitalize on these in-the-moment opportunities to increase sales through richer experiences and deeper engagement. Therefore, there has never been a greater need for retailers to have up-to-the-minute traffic and inventory data to successfully fulfill these orders, and create a seamless, positive experience for the consumer.
Health, safety, and security will continue to be a top priority as consumers return to the store. In fact, we’ve already seen retailers implementing real-time occupancy and thermal imaging solutions to help maintain proper COVID-19 regulations. COVID-19 will have a lasting impact on retailers due to the acceleration of changing shopping trends. Having the right technology and solutions in place will be necessary to meet and exceed consumer expectations in a pandemic and post-pandemic world.
Carrie Tharp: COVID-19 has had a drastic impact on the retail industry at-large, exposing gaps in omni-channel capabilities, business continuity plans, and supply chain responsiveness, resulting in an increased sense of urgency for retailers to digitally transform. Just as brick-and-mortar storefronts have had to limit capacity and change policies depending on regional restrictions, e-commerce platforms have also had to be agile in responding to website traffic spikes and more. Retailers must prepare for the unexpected, and they must be willing to accommodate consumers' varying comfort levels when it comes to how they shop.
As we approach a post-pandemic world, retailers must consider how their consumers will change their shopping habits and, in turn, accommodate for that in their omnichannel and e-commerce strategies. Retailers will need flexible and scalable technology to create the new shopping experiences required to keep up with changing customer demands. For example, we’re seeing a big focus on inventory visibility and providing a better view into the supply chain. Across retail industries, retailers are focused on bringing data to the forefront to understand their business needs and vulnerabilities, like inventory replenishment and more. With the support of a flexible, scalable, and predictive technology infrastructure, retailers will build a more agile and predictive business model so they can better prepare for the unexpected.
Which retailers successfully evolved to meet changing consumer needs during the pandemic?
Shahidi: Retailers across the board have been quick to pivot their strategies to meet changing consumer needs. Nike, for example, accelerated its digital-focused strategy with a new experiential store format to give consumers a more premier shopping experience. Other retailers, including Best Buy and Dick’s Sporting Goods, leaned into curbside pickup by converting their stores into mini e-commerce fulfillment centers. This effort is satisfying consumers’ desires to make a purchase online and pick it up in the store.
Tharp: When we look at past crises, the businesses that weathered uncertain times stayed in contact with their customers, acted fast, and invested in the future. This past year, we saw many retailers accelerate the timeline to modernize their e-commerce infrastructure to keep up with unexpected peaks in site traffic, as well as to enable better channel integration through omni services (e.g. omni checkout). These efforts to quickly adapt and shift from in-store to a digital-first approach has helped move the entire retail industry forward in the digital transformation.
How is the partnership between Sensormatic Solutions and Google Cloud helping to solve these challenges?
Shahidi: As a longtime partner of Sensormatic Solutions, Google Cloud offers the flexibility and scalability retailers need to make prescriptive and predictive decisions about operations from headquarters to the individual store-level. Google Cloud provides Sensormatic and its retail customers with the most open source capabilities so they can integrate the full Sensormatic Solutions portfolio, retailer, and third-party solutions, as well as artificial intelligence (AI) technology. Meaning retailers can leverage their current technology stack and marry them with the latest in machine learning and computer vision.
Bringing this to life with Sensormatic IQ, we’re able to empower retailers to optimize store operations, identify new growth opportunities and act on intelligent, data-driven outcomes. By leveraging Google Cloud, we deliver advanced analytics capabilities with a global reach, helping retailers unify their digital and non-digital strategies and engage customers on their own terms.
We chose Google Cloud as a partner because their vision and commitment to innovation and engineering complement our own. Additionally, Sensormatic Solutions’ in-depth knowledge of retail and its processes married with Google Cloud’s expertise in e-commerce creates opportunities for us to address retailer challenges, now and in the future.
Tharp: Together with Sensormatic Solutions, we are offering retailers the flexibility and scalability they need to solve real-world challenges and keep up with the changing retail industry. Even though more shoppers are shifting to online-first, physical stores are still a very important part of modern retail strategies, and hyper-personalization will be the future of this connected shopping experience.
With tools like Sensormatic IQ, retailers gain the insights they need to succeed in a hyper-connected world. The availability of smart sensors, IoT infrastructure, and other external applications, retailers now have more data at their fingertips than ever before, no matter where they are in the digital transformation process. When combined with Google Cloud’s flexibility and scalability, retailers have the tools they need to make prescriptive, data-driven decisions about operations from headquarters to the individual store-level.
Read part 2 where Sensormatic Solutions and Google Cloud leaders discuss the role the physical store will play in the future, how data will impact retail, and how Sensormatic Solutions and Google Cloud’s partnership will continue to evolve to stay ahead of retailers’ needs.
To learn more about the Sensormatic Solutions and Google Cloud strategic partnership, please read our press release.
Sensormatic Solutions is a vital component of Johnson Controls’ OpenBlue technologies and innovations which leverage big data and AI to optimize healthy buildings. Sensormatic IQ further supports Johnson Controls mission to help customers meet their goals for healthy people, healthy places, and a healthy planet. To learn more about Johnson Controls and OpenBlue, go to JCI’s website.