10 Ways Networking Investments Help Retailers Drive Sales

by Nathan Eddy

Almost half the retailers surveyed claimed increased customer loyalty due to deploying in-store employee WiFi, with an associated 3.4 percent increase in sales. The study suggests that providing employee WiFi is an even bigger positive driver than offering customer WiFi. The research underscores the importance of a creating a connected, flexible workforce that isn’t tethered to point-of-sale (POS) stations.

Historically, retailers only had 15 to 30 percent of their budget available for new, innovative systems, and 70 to 85 percent was used simply to keep the lights on for existing systems and pay for depreciation. Yet the survey suggests retailers are spending a much larger percentage of their budget on innovation. VOIP and WAN/LAN security each have a current use rate of 54 percent, coming in ahead of other retail technologies.

When it comes to customer WiFi, the largest increase comes in the hospitality segment. Here, 61 percent of these providers claim an increase in customer loyalty, and an associated 2.7 percent uptick in sales per customer. General merchandise retailers are finding WiFi has become a great resource for product information and for consumers to promote the retailer and their purchases through social media.

“To stay competitive, small businesses need to invest in technology to enhance the customer experience. The way we shop is changing rapidly, as 84 percent of consumers now use their smartphones in the store environment,” Griffiths said. “With the millennial generation, this is an expectation that influences where they shop. The good news is that by deploying a WiFi solution, you can connect with your customers and gather information on their shopping behavior.”

Savvy retailers also use WiFi to “untether” sales associates so they can be more productive and helpful to shoppers. According to the study, WiFi is directly linked to impressive customer loyalty and sales gains. One-third of retailers (28 percent) reported increased customer loyalty due to deploying in-store customer WiFi, with an associated 2 percent increase in sales.

Nearly 70 percent of specialty retailers are designing their next POS system based on a central order-management system, which will put up to five times more load on the network and will require a WAN infrastructure refresh. However, the investment seems worthwhile: 53 percent of retailers claimed increased customer loyalty could be attributed to the fact that associates had access to WiFi and, on average, this meant 4.3 percent more sales.

Food, drug and convenience store retailers see the least amount of benefit, though 11 percent said the associates having access to WiFi increased customer loyalty. The simple tools of being able to look up inventory status, delivery status and other attributes appear to make an impact on the consumer. Overall, the report noted a key opportunity for increased loyalty and sales comes in the form of WiFi availability to both associates and consumers.

Retailers with fewer than 50 stores say that 57.8 percent of their data security budgets go toward payment card industry (PCI) compliance initiatives, leaving much less to protect against external attacks than the larger retailers have to spend. While PCI ostensibly protects from the store out, that’s not where the main threat to the retailer is, the study said.

The survey also examined analytics respondents track for WiFi use in the stores. Traffic counting (retailers tracking customer phones) is the most common analytics application, cited at 56 percent. Some of the more mundane analytics applications include session duration (49 percent), devices used (49 percent), hotspot use (41 percent), repeat visits (39 percent) and time of use (32 percent). Interestingly, more effort is being spent on social media conversions (37 percent) than for actual sales conversions (27 percent).

Small businesses with limited IT budgets should make an effort to strategically invest in providing WiFi because it can be used to gather valuable presence and use data for business intelligence, push out promotional offers and drive engagement, Griffiths said. “Plus, WiFi installation and maintenance do not require an IT staff or special training,” Griffiths said. “Most retailers also tap into their security budgets to justify the investment because secure WiFi supports industry security and compliance requirements with built-in wireless intrusion prevention.”