Transforming Retail With Edge Compute, 5G, IoT and AI

A Pathfinder paper navigates decision-makers through the issues surrounding a specific technology or business case, explores the business value of adoption, and recommends the range of considerations and concrete next steps in the decision-making process

The retail industry has experienced steady disruption over the last decade, with the COVID -19 pandemic further accelerating digital transformation in the sector. The primary technology driver of this change is the confluence of edge computing, 5G networks, Internet of Things (IoT) devices and artificial intelligence/machine learning (AI/ ML). Connected retail technologies that enable real-time management of outcomes are key to success. Such technologies are ushering in a new era of retail that is customer-centric, data-driven, personalized and dynamic, providing consumers with seamless physical and digital shopping experiences. Products and services are delivered proactively, predictively and conveniently to customers, while yielding higher profits for retailers.

Key Findings:

  • Business leaders in retail planning, sales, marketing and operations face significant challenges: legacy brick-and-mortar retail is evolving, omnichannel operations are the new norm and the expectations of digitally savvy consumers are sky-high. The risk is real: 80% of consumers say they will stop doing business with a merchant due to a poor customer experience.
  • Retailers are making digital progress - but it is slow and needs to accelerate. Just 12% of retailers say their customer experience decisions are data-driven today.
  • To stay ahead of the game, retail leaders are deploying or planning technology across mission-critical use cases both in stores and in back-office facilities such as distribution and fulfillment centers. Top use cases include smart checkout, customer footfall analysis, real-time fraud detection, robot-assisted picking, packing and shipping, and demand-driven forecasting and fulfillment.
  • To deliver those mission-critical use cases, retailers need to modernize their IT to support an intelligent and data-driven edge - IT infrastructure deployed in or close to store venues where consumers live, work and shop. Retailers are busy deploying intelligent edge in the form of app management modernization, IoT sensors, edge compute and storage, 5G connectivity, and AI/ML-enabled analytics. Thirty-seven percent of retail IT infrastructure is currently deployed at the edge; 77% of retailers expect to increase edge deployments significantly in the next two years.
  • To successfully deliver the intelligent edge, retail lines of business (LoB), operational technology (OT) and information technology (IT) executives and teams must work closely together to align business needs, digital processes and technology requirements.

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