Shop X: where's the store heading? (Review Report)

This report combines all three briefs from the retail technology theme for Q3 2007: Shop X; The Future of technology in retail. Incorporating the market, strategy and technology challenges, the Review Report provides a holistic snapshot of the challenges and opportunities in the sector. Data also provides predictions for the future prospects of technology within the retail sector.

Report Highlights


As the growth in multichannel and discount retailing grows, retailers are turning to technology to refine the in-store experience, and retain market share. These technologies bring with them a variety of challenges, both for the vendors and retailers alike - in terms of integration and standardisation, and also in terms of achieving the maximum ROI.
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Overview 1
Catalyst 1
Summary 1
Methodology 1
Executive Summary 2
Introduction 2
Smart shopping: developing the optimum store environment (Market Focus) 2
Shop X: Using technology for competitive differentiation in high street retail (Strategy Focus) 2
The technological demands of the modern store (Technology Focus) 2
The future revenue growth of NFC technology in world retail (Databooks) 3
Smart shopping: developing the optimum store enviromenT (Market Focus) 7
SUMMARY 7
The retail market's structure and evolution 7
Pressures facing retailers 8
Consumers in the UK and US are facing straitened economic conditions 9
Which key technologies can help? 10
NFC, RFID, digital signage and self service are key technologies affecting retailers 10
RFID facilitates effective management of retail assets 11
NFC facilitates contactless payments 13
NFC increases average spend per transaction 14
NFC is a cost efficient technology for retail banks 15
NFC can generate new revenue streams for mobile phone providers 16
Digital signage can provide an effective advertising medium 17
Case study - Woolworths has successfully implemented digital shelf edge labeling 18
Self service tills cut costs and queue times 19
Issues facing retailers 20
Key technologies 20
Using technology for competitive diffrentiation in high street retail (Strategy Focus) 21
Summary 21
RFID provides more effective management of retail assets 21
Failing to achieve expected penetration - what vendors can do 21
Although RFID prices are falling, vendors and supply chain companies are still subsidizing retailers 22
Case study: Gillette razors have implemented an excellent example of a closed loop application 22
RFID can be integrated with other applications 23
Case study: Marks and Spencers demonstrates the importance of a careful cost benefit analysis 23
Companies are using 'slap and ship' tagging to comply with retailer mandates 24
NFC is an ideal payment method for industries in which speed is essential 24
Problems facing vendors of NFC technology 26
Digital Signage is a highly effective advertising platform 26
Case study: Wal-Mart's digital signage system is an excellent example of narrowcasing 27
To increase ROI and drive uptake vendors should integrate digital signage with other applications 27
Self service check outs provide a solution to employee shortage's 27
Loss of impulse buys must be considered when calculating ROI 30
Digital signage vendors should integrate BI offerings into technology offerings 30
RFID 31
NFC 31
Digital signage 31
Self service 31
The technological demands of the modern store (Technology Focus) 32
Summary 32
Lack of harmonization is negatively impacting RFID's uptake and capability 32
How active RFID works 33
How passive RFID works 34
Semi passive RFID 34
Incompatible standards render open loop deployments difficult 34
Using RFID to monitor temperature and stem counterfeiting is gaining popularity, especially in the US 34
The primary differences between RFID standards in Europe and North America 35
Increased uptake of RFID will create a virtuous cycle for vendors and retailers alike 36
The large size and cost of tags makes RFID unsuitable for small or inexpensive items 36
Lack of expertise affects RFID uptake 36
Uncertain ROI and high hardware costs are inhibiting widespread adoption of RFID 37
Generation 1 RFID versus generation 2 RFID 37
Retailers considering NFC weigh up transaction costs versus increased spend 38
A number of forthcoming deployments will push NFC into the mainstream 39
Case study: Japan is an early adopter of NFC technology 40
Digital signage provides an effective advertising platform, but it is expensive 40
There are a number of hidden costs to take into consideration 42
Due to cost of installation / upkeep digital signage is suited to larger retail outlets 43
RFID deployment is limited by high costs and uncertain ROI 44
NFC speeds up the payment process 44
Digital signage is an effective advertising platform 44
The European future revenue growth of NFC technology for the retail industry, 2006 - 2012 (Databook) 45
Introduction 45
NFC market size forecast for the retail industry in Austria 2006 - 2012 46
The global future revenue growth of NFC technology for the retail industry, excluding Europe, 2006 - 2012 (Databook) 62
Introduction 62
APPENDIX 68
Definitions 68
Methodology 69
Further reading 69
Conversion rate 69
Ask the analyst 69
Datamonitor consulting 69
Disclaimer 70
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Table 1: Breakdown of retail type in Europe, North America and APAC 7
Table 2: RFID in Europe and America 36
Table 3: Typical cost of a digital sign for 3 years 43
Table 4: NFC Market Size in Austria, 2006-2012 46
Table 5: NFC Market Size in Belgium, 2006-2012 47
Table 6: NFC Market Size in Central and Eastern Europe, 2006-2012 48
Table 7: NFC Market Size in Denmark, 2006 - 2012 49
Table 8: NFC Market Size in Finland, 2006 - 2012 50
Table 9: NFC Market Size in France, 2006 - 2012 51
Table 10: NFC Market Size in Germany, 2006 - 2012 52
Table 11: NFC Market Size in Greece, 2006 - 2012 53
Table 12: NFC Market Size in Ireland, 2006 - 2012 54
Table 13: NFC Market Size in Italy, 2006 - 2012 55
Table 14: NFC Market Size in Norway, 2006 - 2012 56
Table 15: NFC Market Size in Portugal, 2006 - 2012 57
Table 16: NFC Market Size in Spain, 2006 - 2012 58
Table 17: NFC Market Size in Sweden, 2006 - 2012 59
Table 18: NFC Market Size in Switzerland, 2006 - 2012 60
Table 19: NFC Market Size in United Kingdom, 2006 - 2012 61
Table 20: NFC Market Size in Eastern Asia, 2006 - 2012 63
Table 21: NFC Market Size in Middle East, 2006 - 2012 64
Table 22: NFC Market Size in North America, 2006 - 2012 65
Table 23: NFC market Size in rest of Asia, 2006 - 2012 66
Table 24: NFC market Size in rest of world, 2006 - 2012 67


Figure 1: The pressures facing retail 9
Figure 2: Advantages of RFID Implementation 12
Figure 3: Spend on RFID in the retail sector, by region 2006-2012 13
Figure 4: The importance of mobile technology within retail 15
Figure 5: NFC spend in the retail sector, by region, 2006 - 2012 17
Figure 6: Spend on digital signage in the retail sector 2006-2012, by region 19
Figure 7: How NFC works 25
Figure 8: Self service check out 29
Figure 9: How active RFID works 33
Figure 10: Digital signage system 42
Figure 11: NFC market size forecast for the retail industry in Austria, 2006 - 2012 46
Figure 12: NFC market size forecast for the retail industry in Belgium, 2006 - 2012 47
Figure 13: NFC market size forecast for the retail industry in Central and Eastern Europe, 2006 - 2012 48
Figure 14: NFC market size forecast for the retail industry in Denmark, 2006 - 2012 49
Figure 15: NFC market size forecast for the retail industry in Finland, 2006 - 2012 50
Figure 16: NFC market size forecast for the retail industry in France, 2006 - 2012 51
Figure 17: NFC market size forecast for the retail industry in Germany, 2006 - 2012 52
Figure 18: NFC market size forecast for the retail industry in Greece, 2006 - 2012 53
Figure 19: NFC market size forecast for the retail industry in Ireland, 2006 - 2012 54
Figure 20: NFC market size forecast for the retail industry in Italy, 2006 - 2012 55
Figure 21: NFC market size forecast for the retail industry in Norway, 2006 - 2012 56
Figure 22: NFC market size forecast for the retail industry in Portugal, 2006 - 2012 57
Figure 23: NFC market size forecast for the retail industry in Spain, 2006 - 2012 58
Figure 24: NFC market size forecast for the retail industry in Sweden, 2006 - 2012 59
Figure 25: NFC market size forecast for the retail industry in Switzerland, 2006 - 2012 60
Figure 26: NFC market size forecast for the retail industry in United Kingdom, 2006 - 2012 61
Figure 27: NFC market size forecast for the retail industry in Eastern Asia, 2006 - 2012 63
Figure 28: NFC market size forecast for the retail industry in Middle East, 2006 - 2012 64
Figure 29: NFC market size forecast for the retail industry in North America, 2006 - 2012 65
Figure 30: NFC market size forecast for the retail industry in rest of Asia, 2006 - 2012 66
Figure 31: NFC market size forecast for the retail industry in rest of world, 2006 - 2012 67
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