#NRF2019: The challenge of scaling retail technology

Technology absolutely offers the prospect of a brighter future and the potential solution to many of the challenges that the retail industry currently faces but one of the challenges to adoption can be the difficulty of scaling solutions across a business in a workable and cost efficient manner.

Speaking at NRF’s Big Show in New York City Jeremy King, CTO of Walmart, highlighted how one of the big issues for his business is scaling technology. “Most companies have a scale issue. We used to have 700,000 items on the web and now we have tens of millions. You can’t do that on the same systems. Many vendors’ systems can’t scale to our requirement. Many companies have choked when dealing with our scale. We don’t just need super high performance [from solutions] we also need them to scale.”

One of the solutions to the scaling issue for Walmart is greater use of cloud services as highlighted by its recent announcement of a partnership with Microsoft for the widespread adoption of its Azure cloud capability. He suggests the ability to call on massive capacity and processing resource is predicted to have a dramatic effect on Walmart and the retail sector in general.

“We need solutions that can scale. We still have 90 stores that have no high speed internet!”Jeremy King, CTO of Walmart

Greg Jones, director of industry solutions for retail and consumer goods at Microsoft, recognises the challenge of scaling within retailers’ businesses and how the cloud is playing a major role. He cites Kroger as now implementing an increasingly broad array of technologies in-store that require incredible processing power and the ability to much more easily link data sets together.

“Kroger has its shelf edge labels, its ad platform, a camera network, and scan-and-go in its stores that are all hosted in the cloud. It makes it easier to join this all together and to integrate it across the whole business,” he says.

Scaling data solutions

There is no doubt that the retail industry is becoming increasingly data driven and the ability to scale this across a business is now a necessity. “Sensors and cameras are now used all around and the expectation from retailers and customers is to have faster access to data. It’s about empowering employees [with this data] and possibly also using robots to help with stock-outs in-store,” suggests Jones.

Cloud is also providing the capability to implement rapid change, which is ever more relevant today in an environment of accelerating change in the capabilities of technology: “Retailers can use it to explore faster ways to test new markets and adopt a fail-fast mentality.” 

Dean Frew, CTO of RFID specialist SML Group, says the use of Microsoft’s Azure by SML is vital to it ensuring the scaleability of the solution for large retailers who invariably require incredible processing power on a Monday morning but then need very little the rest of the week.

“The cloud talks to thousands of handheld scanners. Some retailers will do inventory checks on 500 stores at the same time. You need scaleabilty to cope with this large amount of processing. Monday is peak activity over a three hour period and this then drops down to zero on Tuesday. We’ve built the application to support this,” he explains.

IoT challenges

Charlene Marini, VP of new business development at ARM, says the emergence of the Internet of Things (IoT) with sensors and camera usage becoming widespread is prompting the issue of having the scaleability to manage these elements both from a volume of data perspective and also the delivery of robust Wi-Fi across a dispersed store estate.

“Apart from a few big retailers building bespoke solutions involving beacons – and other positioning solutions - the question has been about how scaleable are some of these solutions that involve the management of Wi-Fi and being able to run cameras at low cost,” she says.

This has certainly been an issue at Walmart where King says he has been approached many times about having beacons in-store but even if he placed only two in each outlet he would require 10,000 units. “We need solutions that can scale. We still have 90 stores that have no high speed internet!” he reveals.

There is also the issue of powering the likes of beacons, which King says could be solved with the advent of wireless power: “In-store we have dozens of things that need [power] wire to be dropped to them [from the ceiling]. We’re remodelling 600 stores per year and we’re very excited about having wireless power in stores,” he says.

Scaling retail

Scaling is not only about technology and data but can also incorporate other aspects of retail. This became apparent to Rachel Schectman, founder of Story, when the business was acquired by department store Macy’s. The challenge was to take the concept and ethos of the small 2,000 square foot Story store in New York and scale it to being workable in 600 large scale Macy’s stores.

“We realised it would not work the same at that scale. We spent lots of time working out how to deal with this. It was all about how we presented a new narrative-driven environment into Macy’s stores. It was an opportunity to create new processes and how to approach engaging with colleagues across the Macy’s business. We needed to make the idea sustainable and get them to co-author [Story in Macy’s]. It was also about how we engage with our brand partners at this new scale,” she explains.