Consolidated Efficiency Report

Channel:

In-store with IoT

● Will have advantages of integrating different functions/channels and providing the
highest value to the end customer, i.e., offline plus online integration,
● Store-based product pricing and the assortment
● Time efficiency- self-checkouts solve the problem of long queues.
● Automatic replacement of items

Without IoT
● Reduced costs of the digital upkeep
● More jobs

Pickup-
● An IoT enables pickup store can help the consumer pick up daily items, notify for
any out of stock products, update the order.
● An amazon go veteran consumer can be in and out of the store in less than a
minute with the item they wanted
● People running to the office or needing to be somewhere quick can grab their
stuff and go
● There can be the integration of the online and offline channels, and pickup can
leverage the online sales of amazon by integrating it with the brick and mortar
store
● Savings on the doorstep delivery costs
● The process can enable habitual buying for any consumer on his/her daily route

Delivery:
● Delivery window though should fall in the business hours of the service
● Option for gaining traction in people who would avoid in-store shopping trips
● Sell the products at a higher price available for doorstep delivery

IoT on program and promos:

● IOT stores would help segment-specific promos and offers based on the store
location and consumer buying habits. There can be a daily and quick change in
the product assortment, placing, and pricing based on consumer data.
● IoT integration with the stocks can help in upselling as well as cross-selling of
products through promos.
● The IoT can also help sell low demand items by applying promos, even giving
them better visibility.
 ● There can be flexible pricing changes throughout the day based on the
purchases.
● Promos can entice customers to visit the store when competitors like Walmart
offer EDLP.

Without Promo/Programs:
● Higher profit
● Risk of lower footfalls
● Chances of turning into more of an experience/gimmick store than an actual daily
preferred choice

Age:
● Can be lesser preferred choice of old age/specially abled consumers who need
helpers
● Favored by the young, tech-savvy, and time-efficient consumers

Gender:
● Preferred by both genders as it promotes unisex strategy

Channel Inference and Trade-offs:

The store having IoT integrated with pickup, promos/programs will be having more
benefits as mentioned above with trade-offs of higher cost, lower jobs, and age/disability
specific barriers to the segment-specific consumers

Customers

Turn Around Time - Turnaround time for each customer in a store with IOT decreases
because of the cart, reduction in human intervention and absence of cashier queue.
Reduced TAT leads to more space and time for other customers in the store. It also
leads to less cost spent on maintenance. Overall, TAT in the IOT store is less and it
increases the efficiency.

Check ID Steps - For items like alcohol that needs ID at point of purchase, an IOT store
will have to install ID scanners inside it. On the contrary in non IOT stores, the ID check
step is completed at the cash counter itself. There will be additional cost for this. In case
the system fails or sees a problem, support team has to be available 24*7. For pickup
and delivery channels also, this step is a challenge. It compromises with the efficiency
of the store.
Missed Orders - There will be very less chance of missed orders as right from order
placement everything is recorded in the system. The system will alert the customers as
well as the store staff in case any order is missed. Customers are notified of all
transactions, dispatch of order and order deliveries. Hence chances of missed orders
are rare. IOT stores are efficient in this way.

Delivery Time - IOT store aims to integrate both online and offline channels of
shopping. The online orders are promised to be delivered within a day. With the IOT
store, the delivery time to the catchment areas reduces and helps companies fulfill more
orders. This increases efficiency

Prices - Since the companies are selling direct to customers through this store, their
distributor, wholesaler or stockist margin is saved increasing the contribution
percentage. The store can leverage this and keep its prices low and competitive to
attract and retain more and more customers. The seller don't have to compete for shlf
space and visibility or find new ways of visibility. This helps raise the efficiency of the
store. But one trade off could be that the store might not be able to sell premium
products as its image would be associated with mass consumer grocery.

Quality - The items in the store have to be of good quality. This is crucial because
customers depend on the store for reliability. Especially the online ones, who see where
their products are coming from. In that case they expect better quality. There is no
leeway for under quality products. This aspect does not increase or decrease efficiency
directly but indirectly it increases store/brand trust among customers.

Processes:
IOT in retail is redefining the consumer shopping experience.

Wait time-
The technology of the smart shopping cart or the pickup delivery service gets rid of wait
time by eliminating bar code scanning, eliminating wait time of items not in stock
because this process ensures accurate inventory management and better supply chain
operations. On an average, the consumer takes 5-6 minutes to get the item billed,
bagged, and remove the anti-theft detector and pay.

Check out-
Instant check out without waiting for billing. The automation would also reduce the
number of workforce employed as the billing counters would be reduced, hence saving
labour costs. Human touch is replaced with cameras and automation technologies. On
checkout or pickup, the amount gets debited from the consumer’s wallet. But the pickup
service requires deploying workforce to interact with the consumer and bring his order
to his car.

Slow steps/ Fast steps-

IOT in retail expedites inventory management and ensures accurate forecasting through
inventory notifications, using automated machinery to perform tasks related to
maintenance and stocking. This also ensures no product wastage, specially when it
comes to perishables, because consumer data and monitoring will lead to accurate
forecasts and optimise the amount of stock of perishables to be kept in the store.

IOT in the store will now also have the scope to make the retail experience as an
iterative process given that the store will now have access to huge chunks of consumer
behaviour data and merchandising and other strategies can be constantly
upgraded.The data also lets retail chains provide a more tailored experience to
shoppers.
Even idle browsing time is reduced when the consumer just comes to pick up the
products ordered or even he or she is in the store, the list is saved in Amazon’s Alexa
which helps them know what exactly they need to look for.
The retail store will have digital price tags which leads to speedy updates in prices, in
case of a change.

Confusing steps-
Is the list ordered according to store layout as if the consumer is going by the list on
Alexa, the customer might keep roaming about to and fro in the store?
How is the retail chain (Amazon Fresh)going to accomplish cross-selling and upselling
in the retail shopping experience, especially if the consumer is ordering online and
picking up from the store?
How will IOT ensure that the concerns or doubts of a confused shopper are being
removed, given that it is normally taken care of by store assistants?

Return after payment- Faulty or incorrect items can be returned by asking for a refund
on the app. The money would be refunded to the Amazon wallet.

Items:
Out of stock/Over stock:
IoT allows retailers to incorporate data visualization tools that simplify the methods of
inventory monitoring, pricing systems to ensure continuity across all distribution
channels, and automated repetitive task systems. Automatically, the store gets to know
if it is short of supplies or if the stored inventory is more than the estimated value. In
doing so, IoT not only adds value to customer loyalty and increases customer retention,
but also decreases out-of-stock and over-stock situations that cost about $2 trillion
annually to businesses.
Shrinkage/Breakage:
Shrinkage is the loss of stock that can be due to variables such as theft of workers,
shoplifting, administrative error, fraud of vendors, injury, and error of the cashier. IoT
also affects supply chain security in addition to improving production and productivity by
minimising the risk for item fraud, counterfeiting, and safety issues. A data steam that is
constantly tracked helps an organisation to track assets in real-time, remove the
potential for mistakes in the entry of human data, and preserve reliable inventory
records. Stores like Amazon Go are now using sophisticated object detection cameras
and in-depth behavioural analysis capabilities to track in-store shoppers and inventory.
These automated tools can detect when items are removed and replaced on shelves by
deep learning technology applied to complex pattern recognition to stop shoplifting and
ensure proper payment. The cashier 's presence is often reduced, which further helps
keep the whole system monitored.
Cart:
New ways to shop are included in the 'amazon fresh' grocery store, including the 'dash
cart', a shopping trolley that helps customers to bypass the checkout line, and 'alexa'
wayfinding features that help customers manage their shopping lists and navigate the
aisles better to locate preferred items. Shoppers simply put their bags in the cart, sign in
using the amazon app's QR code, shop, and exit through a specified lane to complete
their payment automatically. Amazon says that to describe the cart's objects, the device
uses a combination of computer vision algorithms and sensor fusion.
The cart also helps the store manage data of its customers that visit the store. This data
can be used by the stores to advertise or promote their new offers to the desired
customer base.

Miscellaneous:
Incidents:

An important threat issue in the form of incidents in IOT includes security threats.
Cybersecurity issues with smart security cameras expose the vulnerabilities of IOT in
shops. An example of incidents include Amazon’s ring video doorbell. Security
researchers from cybersecurity firm Bitdefender discovered and reported a flaw in
Amazon’s Ring Video Doorbell Pro, which could have given hackers unauthorized
access to the user’s Wi-Fi network and potentially to other connected devices on it. At
present, all the Ring Doorbell cameras have received a security patch from Amazon to
mitigate the issue. Smart bulbs, smart home devices and smart TVs are all vulnerable to
security incidents as such. Alleviation of these issues will enhance efficiency.

Ambience:

Ambient intelligence is gradually becoming one of the key components of IOT. Over half
of the world’s population are carrying personal devices that have powerful processors,
sensors, cameras, high-speed communications, and intelligent applications. Ambient
Intelligence concept is basically environments that are integrated with sensors and
intelligent systems. The environments have the following properties:

● Awareness of the presence of individuals

● Recognition of the individual’s identities
● Awareness of the contexts (e.g. weather, traffic, news)
● Recognition of activities
● Adaptation to changing needs of individuals

Ambience is able to deliver personalized services automatically in anticipation of the

needs of the inhabitants and visitors. This is a phenomenon that is increasingly being
followed everywhere. Makes IOT processes seamless and fast and efficient.

Cleanliness:

With productivity and cost savings at stake, it’s more important than ever for those who
manage buildings to consider implementing IoT solutions. With the right IoT tools in
place, facilities can also support enhanced cleanliness, employee safety, resource
savings and brand reputation. Cleanliness significantly impacts the way people perceive
a brand. Whether a facility uses the IoT to keep track of clean linen or help keep floors
and surfaces clean throughout the day, smart devices can provide better cleaning
results on the first try, which drives customer and occupant satisfaction. With access to
real-time data, facility managers gain a clear understanding of everyday use and can
keep up with any immediate or upcoming maintenance needs to reduce downtime.
Running out of essential restroom supplies can result in big problems, especially in
high-traffic facilities like airports and malls. Smart dispensers for paper towels, soap and
air care have all been developed to avoid lapses in restroom maintenance. IOT helps
enhance cleanliness and that in turn improves efficiency.

Friendliness:
In IOT a new field of research has emerged known as social IOT. The cause of
mechanizing all processes and IOT implementation has created a cause for concern
over whether it’ll take over the much needed “human touch”. The interactive and friendly
customer experience that many consumers cherish. The social IoT refers to devices
that are capable of creating interactions with each other to independently achieve a
common goal. Based on the structure, the support of numerous applications, and
networking services, the social IoT is preferred over the traditional IoT.This is moving in
the direction of trust- and friendliness-based approaches in the social IoT with
important highlights of important constraints, such as scalability, adaptability, and
suitable network structures (for instance, human-to-human and human-to-object). This
is the point of focus so as to not lose out on the interactive user experience that
provides a “human touch” as well as negating the human errors with a more optimized
and efficient process.

Power/Utilities:

The introduction of IOT has transformed various industry sectors such as healthcare
retail, manufacturing, and agriculture. Likewise, the advent of IoT in utilities is expected
to reduce the challenges faced by the sector and help evolve it. The application of IoT in
utilities will improve efficiency, generate revenue, and conserve resources. Also, IoT
sensors can optimize energy and water generation and distribution to help utility
providers keep up with the increasing demand. IoT can be leveraged in utilities and
power sectors in a variety of ways. Smart meters that can monitor electricity
consumption in real time. Traditionally, monitoring energy consumption in real-time was
not possible with power grids. But, smart grids offer real-time data that can help utility
providers carry out demand-based power generation and distribution. With this
approach, providers can distribute a utility based on consumption. For instance,
electricity companies can distribute more power to areas such as corporate hubs and
industrial zones compared to residential areas, where power consumption may be
relatively low. By leveraging IoT in utilities, companies can optimize utility generation
and develop customized distribution strategies. IOT finds effectiveness in other
applications like energy conservation, water management, workplace safety.