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Retail Technology Experiments at Metro AG
Retail Technology Experiments at Metro AG
January 12 2010
Last year, I had the pleasure of attending a Canadian retail conference where I was incredibly impressed by the presentation of Dr. Gerd Wolfram, the Managing Director of Metro Group Information Technology GmbH, IT service provider of the German retail giant Metro AG.
Information technologies have a huge impact on retail business performance. This “magic” in IT technology was fantastic 15 to 20 years ago—and now it has become a regular staple and commonness in retail organizations. Metro AG has defined three major future retail industry trends: new forms of communications; better service; and real-time transparency. The organization thinks in terms of future and thus information technology has been defined as one of the company’s priorities. A very good demonstration of such forward thinking is
The Metro Group Future Store Initiative
, which is supposed to drive the national and international modernization process in retailing. The organization opened a new hypermarket in Töenisvorst, Germany, which was called Future Store. Many available retail innovations and technologies were implemented to run the store as an experimental field test playground.
What Innovations were Implemented at the Future Store?
Metro AG applied radio-frequency identification (RFID) at three levels—pallet, case, and item. This allowed the organization to discover new ways of leveraging RFID applications such as RFID-enabled forklifts, Smart Shelves (verifies which goods are currently in stock), meat Smart Coolers (labeled with RFID transponders verifies freshness in packaged meat); and Smart Mirrors (gives customers a detailed explanation of the garment and provides all possible additional information about pricing, discounts, using it in combination with another goods, etc.).
Another implemented innovation is one that facilitates communication. For example, there are many different types of informational monitors and multimedia terminals that interactively inform consumers about goods, current discounts, and send customers coupons on their mobile phones using Bluetooth technology. In the CD/DVD area, customers can listen to selected music via a sound shower, which provides directional audio. There are informational robots that walk around the store and provide consumers with any information they need or just entertain kids while parents are shopping.
Another interesting form of improved communication is stimulating the senses. For instance, the fish department of a grocery store will generate a lemon scent to tempt the customer’s appetite; or there are floor-projected interactive living surfaces where customers can try to catch a virtual fish, or play with virtual bubbles.
Mobile phones are not only considered as a personal communication device. Customers can scan barcodes with their phones, store information about prices, coupons and discounts, create shopping lists, and even pay instead of using cash or credit card. Cash desks are also not forgotten—they are capable of recognizing a customer and charging them directly from their bank or mobile phone account using fingerprint scanners. Also, all cash registers are equipped with RFID scanners.
As a result of these innovations, sales rose by 15% over the last year, and 20% of new customers were attracted. Many of the newly tested technologies were deployed in other stores as well.
I believe this unique experience, in addition to the fact that the project is noteworthy and educative, also helps small and large retail stores and chains to better clarify their own future innovations and technology implementation strategies.
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