GlobalLogic provides experience design, digital product engineering services and Agile software development to global brands in all vertical industries.

Choosing the Right IoT Technologies for your E-commerce Business

August 2, 2016

E-commerce is undergoing a major technological disruption. As the lifestyle of the consumer is becoming more adaptive to online shopping, it is becoming all the more important for the key players of the retail industry to keep their customers satisfied and engaged with respect to experience and quality of delivery.

Many say that IoT (e.g., automation, personalization in apps and websites, etc.) will enhance the customer experience, but before adopting iot technology, digital retailers first need to identify their problem areas and technology options. Although there are many different solutions available in the IoT space — from RFIDs to beacons to BLEs — there is no “one size fits all” solution. Even similar problems may need to be treated uniquely due to different constraints, environments, audiences, and constructs.

In this blog series, I’ll take a look at the different areas of the E-commerce industry that are evolving through the use of IoT Technology , and how businesses can identify the right technologies to use in each situation. First let’s focus on one of the most important aspects of the digital retail workflow: supply chain management.

Identifying Problem Areas

If we asked domain experts and market analysts what is troubling the Ecommerce platforms industry the most, one of the top concerns would be the timely and high-quality delivery of products to customers. Businesses are looking for ways to work smarter and faster in a high-volume order environment by asking the following questions:

  • How can we make orders reach the customer in the shortest possible time after the order is placed online?
  • How can we reduce the possibility of incorrect deliveries and increase quality metrics during the shipment leg — thereby decreasing returns?

Customers are raising the bar with respect to satisfaction and experience, and competition in the space is also setting a benchmark that is quite high. If we try and address the above stated problems, the first step towards improving the system is to identify how the order is processed:

  • How soon does an order request reach a warehouse?
  • How is the warehouse maintaining inventory levels?
  • What is the inventory management process?
  • How long does it take to run through receiving to put-away to stock updates?
  • What is the average time taken from pick-up to manifest against an order?

Now comes the tricky part. After you pinpoint the areas for improvement and identify which processes should be automated through IoT, you need to decide which IoT mechanism will be the most efficient and economical. Should you use RFID technology, or beacons, or BLEs — or a combination of all three?

One approach is to create a comparison metric in order to weigh each option on feasibility, cost, and logistics. Metrics similar to the below chart may help you reach the conclusion that although RFID may be a good option for receiving, packaging, and manifesting, it’s not the best solution for pick-up and put-away in terms of cost, feasibility, and logistics in relation to one’s specific environment.

iot-metrics

Choosing the Right Solution

Let’s look at a specific scenario where you identify that the pick-up process in a warehouse is the area that needs the most attention, as it is taking the maximum time calculated to move from placing an order to manifesting and shipping it to the customer. The reason for the issue is that the picker follows a manual process to (1) locate the aisle and zone where the product is being stored, (2) locate the exact product on the rack, (3) retrieve his/her scanner as a separate device, and (4) scan the product and add it to the bag.

To streamline the process, you would like to automate it using an IoT-based solution that helps the picker (1) quickly navigate to the product’s aisle, zone, and shelf location, (2) scan the product seamlessly without having to switch on a separate device, and (3) update the inventory system in near real-time. It would be a bonus if the solution could notify the picker when he/she selects the wrong product, thereby eliminating incorrect deliveries and bringing down the rate of returns.

In order to decide which mechanism you should deploy, you need to analyze the pros and cons of each solution. For example, although an RFID may be a good solution, it may not economical. To deploy RFIDs across the warehouse, you would need to develop a triangulation algorithm to help the picker navigate to the right zone and aisle, and you would also need to stick RFID tags on each product to help the picker select the right product. Would your suppliers support you with these logistics? How many RFID readers would you need to cover an entire warehouse? Could beacons be a cheaper solution to obtain the same results? What about using an Arduino board with a BLE chip at each shelf that is programmed to identify the shelf location that the picker is searching for?

This is the kind of thinking that developers must utilize when helping Ecommerce solutions/ industry players add real value to their warehousing systems. At GlobalLogic, we are continuously testing the limits of our expertise and creativity to address constraints and potential problem areas in order to come up with the best solution for our customers.

Conclusion

The bottomline is that there is no one solution to all problem statements; while one solution may be capable of addressing problems, it may not be economical. For example, although RFID may be one of the best solutions for receiving a shipment in a warehouse, beacons can aid in building and navigating a warehouse indoor map, and BLEs can help workers locate a product’s shelf location. We may need to use a combination of many IoT-based solutions within the warehouse to create a complete solution. We cannot rely on one mechanism if we aim to build an effective and economical solution and want to add meaningful value to the industry.

Generation-next in this space is definitely on a revolution spree; however, we need to act judiciously and not get overwhelmed with the many and fascinating options available in the market.