The pandemic has been a catalyst for change, accelerating the demand for digital experiences and opening the way for new innovations across industries.
In retail, hit particularly hard in 2020, customer engagement is now largely defined by the digital experience of the consumer. As the economy reopens, consumers who remained loyal to their favorite brands throughout months of lockdowns now expect an omnichannel experience that seamlessly merges their online shopping preferences with a personalized and rewarding in-store experience.
Retailers face the additional challenge of having lots of assets to manage. In a grocery store, for example, there are freezers, coolers, and HVAC systems. At the distribution center, there are those same assets plus conveyor belts, forklifts, and more. Keeping all of this equipment running smoothly is critical to ensuring products stay fresh and are delivered on time.
Savvy retailers now understand that digital transformation is the key to managing a complex supply chain and providing a superior consumer experience that generates brand loyalty. Increasingly, retailers are looking to fifth generation (5G) technology in combination with edge services as a powerful differentiator to deliver consumer experiences and leapfrog the competition to greater profitability. They are turning to SAP to help bring these 5G experiences to life with SAP’s data platform and supply chain services.
For intelligent enterprises, the advantages of 5G over the current standard 4G include greater bandwidth for faster data processing; lower latency for greater responsiveness, which produces even greater benefits when combined with edge computing; and the ability to have more devices connected to the network simultaneously, which has huge implications for IoT-enabled sensors and smart devices. The greatest benefits come from 5G’s capacity for network slicing, low latency, and edge computing.
GSMA Intelligence, the research arm of the global trade organization for the mobile industry, forecasts that 5G will bring 1.8 billion connections by 2025 and a contribution of $2.2 trillion to the global economy between 2024 and 2034
Raising the Stakes in Retail
SAP now offers a solution architecture and monetization platform that enables retailers to gain efficiencies, provide amazing consumer experiences, and unlock new revenue streams with 5G. From the supply chain to the in-store experience, SAP is helping the retail industry realize the exciting possibilities for the store of the future.
“SAP is uniquely positioned to serve as the glue pulling these pieces together – from the retailer, the brand, and a fintech – and covering that last digital mile,” says Frank Wilde, vice president, Global Center of Excellence, SAP Labs in Palo Alto, who has been working with SAP customers to integrate 5G technology into their digital strategy. “That’s what we’re very excited about when we think about how is 5G coming to life.”
For example, when consumers enter a shop that leverages 5G, they will see digital signage for a more personalized in-store shopping experience. When they pick up a product like a box of cereal from a store shelf, they will be able to use their 5G-enabled smartphone to have an immersive experience while learning about the ingredients and product information. After placing that product in their cart, the store’s smart shelf system will trigger a reorder notification to a distribution center and later align the product to a planogram to ensure that new stock is displayed on the shelf correctly, ultimately freeing up the shop’s staff from low value-add activities. To cap off the outing, the consumer’s mobile fintech vendor will streamline the checkout with a frictionless 5G experience.
While consumers enjoy a state-of-the-art shopping experience, retailers can be confident that everything is running smoothly behind the scenes. For example, food spoilage is a vexing problem for many retailers that costs the industry billions of dollars a year. When freezers or coolers breakdown, the retailer has to remove saleable product from the store floor and arrange repairs which can take hours if not days, depending on the problem. Unless there is alternative cooling available, any food removed will be considered spoiled and must be thrown away.
SAP and 5G technology provide a solution. Internet of Things (IoT) devices for monitoring equipment can check the temperature, vibration levels, and other metrics of assets to provide a 24×7 health status to SAP Predictive Asset Insights. If an anomaly is detected, an alert can be sent to the store operations manager in advance of the cooler breaking down. This early notification provides the time needed to either fix or replace the aging unit, saving thousands of dollars of lost food while keeping customers satisfied.
Any of these experiences also can be monetized as a service with the use of SAP Billing and Revenue Innovation Management and SAP Convergent Mediation by DigitalRoute, generating additional income for retailers and brands. SAP customers can explore the RISE with SAP offering and digital transformation as a service as a means to take control of their digital journey with the right technologies for their business.