V ideo surveillance is a mainstay in the retail industry. For years it’s been a vital tool, aiding retailers in security and loss prevention efforts. But retailers know the value of surveillance footage is not limited to ordinary security applications, so they are continuously pursuing innovative ways to turn raw video into “video-based data.” These efforts are driving a need for more storage capacity. In fact, storage capacity used for video surveillance applications is projected to grow at 39.1% compound annual growth rate (CAGR) from 2014–2019. If these predictions are correct, over 221 petabytes (PB) of storage capacity will be shipped to the retail sector in 2019 (IHS—2015 Retail Sector Statistics: Americas).
What are the reasons behind the growth? One is the proliferation of multi-sensor, digital cameras. Retail is second only to the commercial sector in the rate of adoption of high-definition (HD) camera technology. And digital units generate larger file images than analog devices, which results in the need for more storage capacity to save the files.
Another reason is the endless struggle to reduce the amount of merchandise stolen from stores. In retail, video surveillance plays a vital role in loss prevention efforts, and has for years. But theft and shoplifting still plague the industry. Over 48% of retailers surveyed by the National Retail Federation (NRF) reported an increase in inventory shrinkage in 2015. Overall, shrinkage cost the U.S. retail economy $45.2 billion last year (NRF press release). By transitioning to high-definition technology and installing more cameras, retailers hope to reduce those losses.
A third reason is video analytics. In a way, retail video analytics stem from one of the basic tenets of the retail business: understanding the customer. After all, retail has never been a stagnant industry. Consumer styles, attitudes, and preferences change frequently. Merchants can ill afford to stand still if they want to succeed. They must adapt, change, and innovate—or risk being left behind.
As the saying goes, “You must know your customers in order to serve them.” That’s always been evident in retail. From A.T. Stewart’s opening of the first department store in New York City in 1848 to R.H. Macy’s innovative one-price system to the recent no-checkout-line concept behind Amazon Go, successful retailers have demonstrated a knack for understanding consumer preferences and responding to those preferences in innovative ways.
Today, retailers are leveraging in-store video analytics to gain valuable insight about their customers and their store operations, such as the following:
Who are my customers?
Retailers need to know the demographic makeup of their customers to make better decisions about advertising, product placement, and merchandise mix. By parsing video streams, video analytics solutions can identify shoppers by age and gender, providing retailers with valuable statistical information about their potential customers.
How many people are in my store, and where do they go once they’re inside?
Video analytics can analyze foot traffic patterns to give retailers data on how many people are in their store, the path they travel once inside, and where they congregate (using video-based “heat maps”). This helps merchants identify patterns, peak periods, and popular locations, which enables them to make changes to floor layouts, displays, advertising, or staffing to better serve their customers and increase revenue.
How long do my customers have to wait?
No one likes standing in line. Of all the things that irritate consumers, standing in long lines has to be one of them. Video analytics allows retailers to monitor choke points—like registers, service counters, and entrances—to identify problem areas early, so additional personnel can be dispatched to help.
How much time do shoppers spend in my store?
Time spent in the store and dwell time—the amount of time shoppers spend interacting with end caps, displays, or kiosks—are two metrics that provide valuable information to retailers. However, neither metric is frequently tracked (only 23% and 10%, respectively, according to data from RIS News). But, with video analytics, that’s changing. Now, retailers can track how much time shoppers spend in the store as well as monitor how they respond to display advertising and end cap offers, so they can gauge effectiveness and make adjustments accordingly.
Without question, video surveillance data is changing the game in retail. Today more than ever, merchants are focusing on consumer behaviors and optimizing the in-store experience. Through high-resolution camera technology and retail video analytics, retailers are able to capture and analyze more video-based shopper data than ever before, which is driving a need for more storage capacity. But, maximizing the value that can be derived from that data requires more than just capacity—it requires a multi-tier, high-performing storage system purpose-built for video applications that can grow incrementally and cost-effectively, while ensuring files remain easily accessible.
To learn more about Quantum’s multi-tier storage solution for video surveillance in retail, stop by our booth (#243) at the upcoming NRF Retail’s BIG Show in New York on Jan 15–17, or visit our Video Surveillance Solutions page.