Whenever the fifth generation of wireless connectivity is mentioned, speed is often the first thing mentioned. It will allow users to download and transmit data on their mobile devices faster than ever before seems to be the common refrain.
“5G is really three things — speed, latency and massive connectivity,” Michael Colaneri, a 30-year AT&T veteran who now leads the telecom’s retail business vertical recently told Retail TouchPoints. “Speed is how fast; latency is what kind of friction you have in that speed; and mass connectivity is about being able to distribute it to more people more efficiently.”
Relatively speaking, 5G is still new both for customers and enterprises, but is predicted to grow quickly and become the foremost wireless network by 2027. At that time, 5G is forecasted to hit 90 percent penetration in North America, according to technology manufacturer Ericsson.
Looking ahead, when 5G is combined with tech like Internet of Things (IoT), computer vision or cloud computing, it will open up a lot of high-speed, wireless possibilities such as virtually enhanced, personalized in-store shopping and real-time SKU-level supply-chain tracking.
“5G is going to be hugely transformative in terms of how we shop, how businesses operate and how retailers can learn from real-time data in a way that’s incredibly operationally efficient to drive business decisions,” Lisa Collins, Head of Enterprise Partnerships and Product Strategy at Verizon’s 5G Labs told Retail TouchPoints.
How will 5G impact retail?
Given that 5G is still in its infancy, a number of questions remain about the next generation of wireless technology. It’s hard for industry experts to advise customers whether they need to switch to 5G because it often comes down to need, and what they’d be using it for, according to Colaneri.
“I don’t have a retail client today that isn’t acutely aware of 5G, but there’s a lot of misperceptions out there,” he said. “Oftentimes my clients talk to me about the urgency to migrate to 5G because they think it’s going to be some big cost savings. It could or couldn’t be. I can’t even tell you if that’s the case without understanding what you’re going to do with it.”
While there’s a fair amount of uncertainty surrounding 5G, it will be not without its uses, especially when it comes to digitization. Here are five places Retail Touchpoints noted that 5G-enabled experiences and solution are being tested or deployed in retail locations.
Real-time fraud prevention and customer support
5G’s speed and mobile-edge computing make real-time data analysis and response a reality. There’s less need for an entire server room to exist in a store, which opens up floor space and can help reduce costs. Meanwhile, companies like Google, Microsoft and Amazon are working with wireless carriers to help manage any data processing in the cloud to “power whatever it is retailers want to do, and you can do these things with a smartphone,” Collins said.
Plus, 5G provides more upload bandwidth, allowing retailers to upload video feeds from their stores to the cloud more easily and faster, according to Steve Gurney, Head of Worldwide General Merchandise Retail at Amazon Web Services (AWS). Lower latency between end devices and the cloud let retailers use artificial intelligence and machine learning analyze their video feeds and respond in real time.
Faster, easier checkout
The increased bandwidth/lower latency combination that 5G can produce leads to solutions like Amazon’s Just Walk Out tech, where customers can simply purchase something in a store, which is tracked through cameras and AI so they can skip the register experience altogether. Verizon and AiFi have deployed a similar solution at a large event like the Indy 500. They also worked with Levy, Detroit’s Ford Field’s food and beverage provider, and saw double the revenue, twice the amount of items purchased and transaction time decrease by half compared to another store that didn’t use the tech.
Better, more personalize in-store shopping experience
Additional bandwidth could create opportunities to anticipate customers’ needs and provide hyperlocal experiences with custom mobile apps such as in-store navigation or special promos based on a shopper’s buying history, according to Gurney. Stores could also offer augmented reality experiences that let people see how an item might look at their house while they’re still at the store.
While this is an exciting opportunity, it will rely on the customer having a 5G-enabled mobile device, so retailers will have to determine when they feel there are enough people on 5G to make it worth adding these experiences to their location.
In-store inventory management
When 5G and IoT-embedded sensors work together, retailers can see their inventory levels in real time and get their shelves restocked faster. Verizon noted that using AWS Smart Shelf tech has helped it drive a 12- to 13-percent increase in revenue simply because it can access the real-time data, Retail Touch Points reports.
Supply-Chain Optimization
Distribution and supply-chain topology are two retail areas where 5G has become established, Colaneri told Retail Touch Points. 5G has quickly become popular in the supply-chain sector because there are so many moving parts in retail distribution centers, between all of the goods that come in on various modes of transportation and need to be organized and sent out.
“In a 4G world the signal is highly inconsistent because (distribution centers) are usually not sitting in the center of a metropolitan area,” Colaneri said. “That consistency of signal becomes valuable if you want to have constant, real-time location data on the merchandise, particularly if it’s temperature sensitive or there’s any other any other characteristic that needs monitoring.”
IoT and 5G let distribution centers tag merchandise and can track variables like location and temperature. Supply chain remains in constant view, too.
“None of this could exist before 5G and mobile-edge computing,” Collins said. “5G and mobile-edge computing will not only enhance but will transform the next generation of experiences. This is just the beginning.”
