This interview was originally published on the RIS News website.
The ongoing COVID-19 pandemic has turned retail on its head, disrupting long-established operating models and forcing retailers to react to a changing marketplace at unprecedented speeds. One of the biggest immediate changes the worldwide health crisis ushered in was a meteoric rise in digital retailing.
E-commerce has experienced steady growth over the past few decades, and the pandemic has only accelerated that evolution. However, many retailers were built from the ground up with an in-store focus and are ill-equipped to handle a digital-first, direct-to-consumer market. As such many retailers are scrambling to reimagine and reequip their supply chains to meet rising e-commerce demand.
RIS spoke with Digimarc’s VP of marketing, Heidi Dethloff to shed some light on the current state of the retail supply chain and the technology retailers should be exploring to stay ahead of the curve.
RIS: The pandemic has caused many disruptions to the retail supply chain. What’s your view?
Dethloff: Looking at the bigger picture, and trends that figure to become a ‘new normal,’ I’m interested in how retailers are responding to the dramatic shift in how people shop, and what effect that has had on legacy supply chain systems designed around a conventional shopping model that no longer exists.
RIS: Describe this consumer shift and the specific impact it is having.
Dethloff: For retailers built primarily for in-store purchases, the sudden shift to e-commerce and online ordering has required companies to invest heavily in several key areas, including last-mile fulfillment and better inventory tracking; areas of investment that likely weren’t as high a priority prior to the pandemic. Looking around the industry, many companies met these challenges by expanding their workforces. But it’s clear that retailers will need to take a more efficient, sustainable approach over the long term to see where technology and automation can fill existing gaps and streamline operations.
RIS: What are some of these technology considerations?
Dethloff: Consumers now expect choice in how they shop, and they want this freedom without sacrificing convenience or accuracy. That means more products need to travel faster and across a greater number of overlapping channels. In addition, it is becoming essential for products themselves to carry better, more accessible data. This is critical for retailers and consumer brands to maintain a more accurate and granular view of products as they traverse the supply chain, as well as to predictably manage inventory and address issues precisely and proactively. Among other things, these challenges have compelled retailers to look at modernizing legacy automatic identification and data capture (AIDC) systems based on traditional barcodes. This is necessary because the UPC Product Symbol, for example, wasn’t designed to meet the needs of today’s dynamic retail supply chains and is incapable of carrying the extra data that retailers and brands – even some consumers – crave.
RIS: How does Digimarc address this challenge?
Dethloff: The Digimarc Platform is an AIDC platform with two key distinguishing features from traditional barcode-based systems that are particularly relevant to this discussion. First, Digimarc relies on an advanced machine-readable code called Digimarc Barcode that is largely imperceptible and can therefore be replicated across a greater surface area improving scanning speed and accuracy, especially in dynamic, high speed environments. Second, Digimarc Barcode has a higher data capacity than the traditional barcode allowing for item-level identification critical for providing real-time insight into product locations. And, we can apply Digimarc Barcode through a variety of methods including digital printing, industrial ink jet and laser ablation.
RIS: What are some of the ways retailers and brands can leverage these unique capabilities?
Dethloff: By allowing greater product traceability, Digimarc can add value across the entire supply chain from product origin at farms or factories all the way to disposal and recycling. With our partnerships and integrations across the industry, we can help deliver solutions that address brand protection, counterfeiting, food safety, manufacturing quality control and waste reduction. There are also efficiency gains across activities that are reliant on barcode scanning, such as retail checkout, inventory management and shipping/receiving.
Find out more about supply chain resilience and efficiency by accessing RIS News’ free Supply Chain Technology Study 2020. It provides:
- Benchmarks for the state of the retail supply chain
- Details on technologies that are keys to success
- Recommendations on ways retailers can more quickly recover from future disruptions
For a deeper dive into the study and expert commentary on key themes, register for an upcoming webinar, hosted by RIS News and featuring Digimarc’s CTO Tony Rodriguez.