SSI recently traveled to San Diego to attend the annual National Retail Federation (NRF) Loss Prevention Conference & Expo and convened with several system integration and technology providers to learn about trends, challenges and opportunities in the retail sector.
When discussing the state of loss prevention, it becomes eminently apparent that the market landscape continues to undergo a dynamic evolution despite years of economic hardship. Among the disparate variables driving the transformation, networked systems and fiscal restraint are hastening the end of siloed technologies across the enterprise.
For instance, video surveillance is no longer solely the domain of physical security and life safety. IP-based systems, coupled with analytics and other electronic devices, are allowing organizations to not only protect brick-and-mortar locations, but also optimize retail processes and improve business efficiencies. This type of cross-functionality is providing a compelling ROI case to organizations while allowing the cost of a solution to be shared among multiple departments.
Of course, such a scenario introduces new players to the decision-making table. For systems integrators, this means they have to forge new relationships and speak new departmental languages if their sphere of influence is going to expand beyond the singular rapport they have traditionally fostered with a security director.
Let’s hear more details and insights from the market experts we met up with at the NRF conference.
The Evolution of Loss Prevention
Dramatic may be an understatement to describe the arc of security as a discipline in the retail sector. Distilled to its most essential form, safeguarding a store and its assets has been mostly twofold. It has long been about making sure that if there was a break-in afterhours, the police would be dispatched. During business hours, loss prevention would eventually become a driver in combatting employee theft and shoplifting. As security technologies and services have advanced, and retail organizations have become more complex, the loss prevention professional’s plate has grown in lockstep.
“Addressing security drivers has always been a part of what loss prevention does — whether that is theft or shrinkage — but they are also now addressing business drivers of the organization,” says Marty Guay, vice president of North American field operations and sales for Stanley Security Solutions. “That can include audits or compliance or tracking products in the supply chain.”
Additional chairs at the executive table have been added as a result of all the organizational sea change. Loss prevention is sitting next to procurement, which has also become ever more sophisticated in recent years. IT is entrenched now that formerly self-contained and locally stored security systems reside on the retailer’s infrastructure. The result is networked video can be accessed by other departments. Layer on analytics and the video investment can be utilized by store planning to track queues, foot traffic, staffing needs and more. And hello to the risk management department, which is utilizing networked video to investigate slip-and-fall incidents, worker’s comp issues, etc.
“We are seeing more people at the table because the solutions are becoming much broader and more powerful inside the customer’s organization,” Guay says.
Further illustrating the degree of transformation in the market, Steve Sell, director of marketing for retail at Tyco Integrated Security (TycoIS), suggests a new title is in order for the loss prevention officer or director. In a nutshell, here is his case for coining the moniker chief visibility officer or CVO: Retailers have moved beyond standalone technology, such as electronic article surveillance (EAS) systems, cameras and access control. Nowadays the market is focused on store performance and improving upon the customer experience. The mission of loss prevention, he says, is to leverage technology in order to drive increased visibility across the organization.
Sell delves further: “The LP professional is now saying, ‘My new technology like RFID and the cameras and all the traffic intelligence and people counting are all working together. And guess what? A big part of what it does is it helps our merchandising people. It helps our marketing people. It helps our store operations people. And by the way, it still helps create a defense against shrink.’ That visibility aspect is what we are really creating. Don’t look at yourself as a loss prevention person who just tries to fight shrink. Look at yourself as a visibility officer who is trying to help the whole enterprise to see where the products are.”
Video Content Analytics, Mobile POS Among Disruptive Trends
Among emerging technology trends showcased at the NRF conference, business analytics programs are focusing on point-of-sale (POS) and merchandise returns in conjunction with enhanced video surveillance. These intelligent retail analytics programs not only benefit loss prevention efforts, but they can help manage the overall business strategies, efficiencies and control fraud.
“At the beginning of the day, having a clear camera image isn’t the sexy part of the application. It’s really about working with a lot of vendor partners to deliver a unified, coordinated system that delivers cross-functionality to retailers across the board,” says Jackie Andersen, business development manager, retail, for Axis Communications.
To highlight a few examples of what is possible with video content analytics, retailers can determine customer dwell times and movement patterns, apply it to POS integrations to record and follow what is happening with the money at cash registers, and with access control systems to manage direct-store deliveries.
“There are a lot of things from an operational and marketing and loss prevention cross-functionality that is driving a lot of value to the camera, and more importantly to the retailer’s bottom line,” Andersen says.
Despite the retail market’s advances in applying new technologies, significant departmental barriers remain in many organizations. The use of video serves as an example of this reality. Andersen describes a culture where the loss prevention professionals, some of whom still believe they own the video, are adjusting to a new paradigm under which other departments are staking claim to video data as well.
“In a lot of these retail establishments we find that we have marketing and operations buying their video and integrating it with video content analytics,” Andersen explains. “It’s a completely separate budget and rollout from what loss prevention is doing because they have a very specific need in mind and a specific angle.”
Nonetheless, Andersen believes the tipping point is nearing when security providers will be able to commonly sell to internal stakeholders and realize an actual true partnership and cross-functionality where a single camera streams multiple views for multiple purposes. “When that is embraced then you are sharing the cost overall. That will start to actually make some of those barriers to entry evaporate over time.”
Page 1 of 2 pages 1
Vertical Markets ·
Loss Prevention ·
Retail Theft ·