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I want to find the weather for in .

Digital Disruption or Digital Transformation?

Posted by Isabel Riley on 11th December 2017

Julian King, Head of Retail at independent property, construction and management consultancy, Rider Levett Bucknall gives his thoughts on how retailers can use technology to their advantage from design of space, customer experience, warehouse and stock control through to build and refurbishment of their estate.

Advances in technology have changed the landscape of our high streets forever and those retailers that have survived the demise of the high street have done so by realising that what customers want is not a single source solution of bricks and mortar, but an integrated shopping experience.

Until recently the primary drivers of digital change in-store have been customer payment improvements like the productivity enhancements of Self-Service Checkouts. The next generation of this change is now happening with forward thinking retailers trialling efficient Mobile-Pay apps that are likely do away with checkout. However, the challenge as this transformation occurs will be maintaining customer contact and loyalty via strong underlying customer service principles.

In-store digital transformation rather than disruption is the order of the day for retailers with concentration on ensuring operations are slick, cost effective and customer friendly.

Mobile phone retailers are developing their own versions of technology enabled stores with the recent EE flagship development in Tottenham Court Road and O2’s recent Brent Cross and Westfield stores as prime examples. Gone are the displays of product and sales collateral, now replaced by interactive screens to help personalise the customer’s buying journey.

With technology enabling less sales collateral and more information now online the impact in store is noticeable with a cleaner and clearer retail look and feel within the sales space. This in turn is allowing for products, and more importantly accessories or add on purchases that have higher profit margins to be added into the customer’s basket. Leading home electronics and accessories retailer, Maplin, that we are working with on an extensive refurbishment programme, has recently announced a significant uplift in sales in its new look stores that showcase technology.

It is not just about the look and feel of the store though. European retailers have been using tech to deliver shelf edge prices based on supply and demand for a while, and trials are underway at one of the top four UK supermarkets to take this a step further, with the latest shelf edge technology and link new video device capability to aisle based marketing campaigns. And, there is talk of electronic pricing going one step further and reading cookies from mobile phone to personalise pricing for individuals.

Behind the Scenes: From Build and Refurbs

Yet it is not only the customer-facing side of retail that tech is evolving. Technology has been integrated into the retail build process for a long time now with 3D and real-life models used to plan, design and fulfil the space. However, where technology is becoming more beneficial is allowing retailers to project manage the build or refurb accurately, on time, and on budget. At RLB, we have seen the first-hand use of applied learning and technology to manage the contracting supply chain to ensure they meet their KPIs and programmes remains on target with our RLB Field app. Tesco has deployed RLB Field to capture real time project data and building condition survey data. This has enabled a small programme office to receive and analyse both performance and risk data such that CAPEX can be prioritised and targeted to achieve maximum value.

Maximising Efficiencies Through Stock Management

Centralisation of data, facilitated by technology has also made a huge difference to the retailer’s ability to manage stock and analyse supply and demand. We are working with another high-street retailer to help categorise and centralise the components on their petrol station forecourt estate. So, at the touch of a button, they will know what sort of lightbulb is used in the toilets in the Epsom petrol station and what material is used on the roof at their Dundee forecourt. This kind of data collection means that they can predict, and be equipped for the future, allowing them to buy smartly and save warehouse space on unnecessary maintenance parts.

Stock rooms are becoming more digitally enhanced with robots set to take over stock distribution, drones replacing security guards and talk of depots literally in the cloud. RFID (Radio Frequency Identification) chips have been implanted in pallets for a while, with sensors detecting their location and being able to check the quantity and positioning of stock, making deliveries and distribution more efficient and increasing productivity.

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