EAS Optimisation Webinar March 20 th 2019 Colin Peacock - PowerPoint PPT Presentation

EAS Optimisation Webinar March 20 th 2019 Colin Peacock – colinmpeacock@ecr-shrink-group.com 1

Introduction to ECR • A ‘save to invest’ group focused on retail loss – a problem that can be >3% of retail sales and circa€100 billion in lost profits for European retailers • Positions/roles held by group members include retail store operations, loss prevention, profit protection, supply chain innovation, buying and on-shelf availability • The Group promotes the role of collaboration 2

Our Work

Current Research Agenda “Hot off the Press” ECR Report on Online Sales returned to  stores – “No such thing as a free return!” Work in Progress Collaboration White Paper – Are you  ready to collaborate? Inventory Record Accuracy – What is  the sales lift from more accurate inventory records? 4

2019 Meetings 2019 Dates Jan 23 rd – ECR and Checkpoint Learning Series – Webinar – Risk Amplification  Jan 24 th – Video in Retail Workshop – London  Feb 12 th – Webinar to launch Returns Research  Feb 13 th - Self-Checkout Workshop – London  March 13th & 14th – Working Group Meeting – Madrid  March 20 th – ECR and Checkpoint Learning Series – Webinar – EAS Optimisation  April 2 nd – Returns Workshop – London  May 15 th – ECR and Checkpoint Learning Series – Webinar – Measuring Impact  June 19 th / 20 th – Working Group Meeting - Copenhagen  June 26 th & 27 th – Waste Working Group meeting – Brussels  Late Sept / Oct - Working Group Meeting – TBC  November – Sell More, Waste Less Meeting – TBC  2020 Dates Jan 21/22 - Video in Retail Workshop – London  Feb 12 th - Self-Checkout Workshop – London  Mid March – Working Group Meeting - TBC  5

Today’s Webinar  EAS Research Insights  Retailer Response  Questions 6

Today’s Webinar  EAS Research Insights  Retailer Response  Questions 7

The Research 8

Since publication……… 9

Growth of Frictionless..… 100% 0% % of Transactions via Self Checkout Source: Speaker Estimates – March 2019 – Developed Markets

Frictionless and EAS Challenges Opportunities  The business response to  Store design and self- the concern that EAS checkout corrals can lead deactivation will add to the EAS gates being in friction to the self-checkout closer proximity to shopping journey members of staff  Turn off EAS gates  Training Opportunity  Remove EAS devices  Compliance Monitor

EAS Gates at Exit of SCO Corral? 12

EAS 101 – How EAS works Offender Decision Tree How EAS changes Retailer Dependencies behaviour Will I get caught? How easy is it to do it? Is it worth it? If I get caught, what will happen?

EAS 101 – How EAS works Offender Decision Tree How EAS changes Retailer Dependencies behaviour Will I get caught? The EAS enabled device the offender can see will activate the gates on exit and a staff member / security guard will approach and “catch me” – need to think again before stealing How easy is it to do it? Is it worth it? If I get caught, what will happen?

EAS 101 – How EAS works Offender Decision Tree How EAS changes Retailer Dependencies behaviour Will I get caught? The EAS enabled device the Presence of EAS device needs to be made visible / advertised • offender can see will Deactivation / Removal of EAS device needs to be perfect – • activate the gates on exit reduce “crying wolf” and a staff member / EAS gates in the right location • security guard will approach EAS gates maintained and in working order • and “catch me” – need to Trained and available staff members in close proximity to the • think again before stealing EAS gates must approach those activating the EAS gates How easy is it to do it? Is it worth it? If I get caught, what will happen?

EAS 101 – How EAS works Offender Decision Tree How EAS changes Retailer Dependencies behaviour Will I get caught? The EAS enabled device the Presence of EAS device needs to be made visible / advertised • offender can see will Deactivation / Removal of EAS device needs to be perfect – • activate the gates on exit reduce “crying wolf” and a staff member / EAS gates in the right location • security guard will approach EAS gates maintained and in working order • and “catch me” – need to Trained and available staff members in close proximity to the • think again before stealing EAS gates must approach those activating the EAS gates How easy is it to do it? EAS enabled keeper cases, spiders and hard tags mean that I need to remove them and reduce the amount I can steal – need to find another easier store Is it worth it? If I get caught, what will happen?

EAS 101 – How EAS works Offender Decision Tree How EAS changes Retailer Dependencies behaviour Will I get caught? The EAS enabled device the Presence of EAS device needs to be made visible / advertised • offender can see will Deactivation / Removal of EAS device needs to be perfect – • activate the gates on exit reduce “crying wolf” and a staff member / EAS gates in the right location • security guard will approach EAS gates maintained and in working order • and “catch me” – need to Trained and available staff members in close proximity to the • think again before stealing EAS gates must approach those activating the EAS gates How easy is it to do it? EAS enabled keeper cases, 100% of the items on the shelf need to be protected – huge • spiders and hard tags mean waste of effort if (say) 10% are not fitted with the physical EAS that I need to remove them device, hard tags, etc and reduce the amount I can steal – need to find another easier store Is it worth it? N/A If I get caught, what will N/A happen?

EAS Targeting Effectiveness by Thief Type 100% 77% 75% 72% 80% 58% 60% 36% 40% 29% 25% 25% 16% 20% 2% 0% Soft Tags Hard Tags Keepers Bottle Tags Spiders Opportunist Organised Source: EAS Global Users Survey – 2016: https://ecr-shrink-group.com/page/eas-users-research 18

EAS - 2016 Challenges Opportunities Poor store tagging compliance # of Source Tagged Products   Lack of support for source tagging Staff Compliance   Low responses to gate alarms Pre-filled displays   Not a priority for the business (esp: Drug) Integration with CCTV / POS   Lack of means to track / monitor RFID + EAS   Store design issues (esp: Grocery)  Source: EAS Global Users Survey – 2016: https://ecr-shrink-group.com/page/eas-users-research

Indicated Actions  Take actions and make changes to the EAS program to amplify the risk to the Opportunist thief.  Security Claims on protected products  The store wide marketing of risk – including public view monitors 20

Critical Role of Visibility Source: Situational Crime Prevention in Retail - LPRC 2018 21

Critical Role of Visibility  See it  Get it  Fear it 22

In Store Marketing of Risk 23

Indicated Actions  Take actions and make changes to the EAS program to amplify the risk to the Opportunist thief.  Security Claims on protected products  The store wide marketing of risk – including public view monitors  Move more of the tagging application upstream and away from the store. Think differently:  Engage the buyers 24

Engaging the Buyer Source: RILA Engaging the Buyer Report, Professor Nicole de Horatius 25

Engaging the Buyer - Education  Invest in Buyer Training  Quantify Benefits of Engagement  Success equals the buyer always asking this question: “What can I do to protect my items, especially new items, from shrink / theft?” Source: RILA Engaging the Buyer Report, Professor Nicole de Horatius 26

Engaging the Buyer - Metrics  Shrink  Inventory Record Accuracy  On-Shelf Availability  Store Compliance  Distribution  Display  Day One Source: RILA Engaging the Buyer Report, Professor Nicole de Horatius 27

Engaging the Buyer - Analytics  Buyers need Data  Insights  Choices  Benefit Analysis  Make it Easy Source: RILA Engaging the Buyer Report, Professor Nicole de Horatius 28

Engaging the Buyer – Design for Execution  Assortment  Packaging  Layout  Theft Protection  Life Cycle Source: RILA Engaging the Buyer Report, Professor Nicole de Horatius 29

Engaging the Buyer – Culture Shift FROM TO Source: RILA Engaging the Buyer Report, Professor Nicole de Horatius 30

Indicated Actions  Take actions and make changes to the EAS program to amplify the risk to the Opportunist thief.  Security Claims on protected products  The store wide marketing of risk – including public view monitors  Move more of the tagging application upstream and away from the store. Think differently:  Engage the buyers  Adopt “take tagging away from the stores” mindset 31

“Away from Store” Tagging  Source Tagging  “Away from Store” Tagging 32