Edge computing
for retail will
transform the
customer experience

There's more to retail technology for small businesses than point-of-sale (POS) systems. Edge computing for retail has the potential to enhance the customer experience and employee productivity while improving the bottom line.

The challenge for small businesses, especially retailers, is that they often lack the resources and personnel to deploy and manage complex network and computing solutions. However, edge computing through a managed service provider can deliver turnkey solutions that reduce latency and alleviate network traffic concerns while ensuring data security for both the retailer and the customers.

Not only does edge computing for retail technology have the potential to transform POS interactions but also may enable small retailers to enhance the in-store shopping experience while gathering insight into customer behaviors and preferences.

Edge computing is an emerging cloud computing architecture that places compute, storage and networking resources at the network edge in close proximity to the location of the end-devices that generate and consume data. It's different from the cloud computing model that has data being stored and processed in a central location.

The primary benefits of edge computing are improved response times and lower bandwidth requirements because local devices carry out some or all the data processing rather than shipping it off to a remote, distant data center. Because data doesn't need to be sent to a central location to be processed and then sent back, latency is reduced to the point where tasks can be done in near real-time with relatively low lag. Less traveling for data also bolsters security and privacy because it reduces the opportunity for sensitive information to be intercepted during transmission and the devices themselves have more control over their respective data.

Edge computing is continuing to evolve, which means there are more opportunities to reduce the need for sending data to the cloud and back for processing and storage through network architecture concepts such as multi-access edge (MEC) computing and mobile edge computing. MEC enables cloud computing capabilities and an IT service environment at the edge of any network. Mobile edge computing, meanwhile, provides an IT service environment as well as cloud-computing capabilities at the mobile edge of the network near subscribers, enterprises and other organizations.

For small business retailers, the potential opportunities unlocked by MEC go beyond faster data processing and lower latency. It's about where the data is processed and how retailers are optimizing the customer journey, whether online or in store.

One of the key drivers of edge computing for retail technology in 2020, according to IHL Group, was a need to refresh how point of sale (POS) is done at the store level, often with the goal of having a single app across all devices. This "POS concept evolution" is part of retailers needing to support new customer journeys, including those influenced by the COVID-19 pandemic, such as click and collect, local delivery, and checkout via customer devices. 

For example, the ultra-low latency supports virtual reality (VR) and augmented reality (AR) applications that help shoppers evaluate products in-store, thereby creating an experience that draws more foot traffic. AR wayfinding can also help shoppers navigate the store to find what they're looking for. Edge computing for retail would also allow for the use of infrared beacon technology to generate in-store traffic patterns to help inform placement of products. Because the data is local, it can be acted on immediately to support context-aware applications and improve security.

Edge computing can leverage 5G deployments to enhance technology such as digital signage that uses rich graphics and updatable content to create a compelling, personalized customer experience. It could also streamline customer payments with mobile POS services that don't require heavy equipment. Any space can become a virtual sales floor by quickly and easily deploying interactive kiosks and tablets to check inventory, review purchase histories and complete transactions—all facilitated by fast, secure 5G connectivity.

The faster speeds furnished by 5G should help to address network and security concerns as to allow product brands to deploy their own devices for customer service at the store level through self-service kiosks with video communications without having to touch the retailer's network. 

Retailers can use MEC-enabled video sensors, computer vision and RFID technologies to get to accurate inventory counts in real time at the store level. Overall, edge computing can help small retailers deliver the seamless, immersive experiences customers expect from businesses of any size by optimizing your supply chain with real-time data to track and manage products.

Looking ahead to 2025, IHL Group sees edge computing for retail growing beyond just fixing inventory issues to supporting artificial intelligence (AI) and machine learning (ML) that solves store operational issues.