Revolutionary retailing a reality

German supermarket uses wireless, RFID to run business.

Imagine a transponder tagged to a bottle of shampoo tracking its whereabouts in a supermarket, or a "smart" shelf informing staff to replenish the selection of cream cheese, or a mini-PC attached to the shopping cart, letting shoppers scan their own purchases, call up bargains and navigate the store.

No, these gizmos aren't science fiction; they're cutting-edge IT retailing systems that are being tested in a supermarket in Rheinberg, Germany. The store is serving as a retail laboratory for its owner, Metro, with about 40 hardware and software partners from around the globe. And it's raising some eyebrows in the industry.

The collection of applications in Metro's Future Store initiative aims to boost store efficiency, through such improvements as enabling targeted marketing and ending long queues.

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Imagine a transponder tagged to a bottle of shampoo tracking its whereabouts in a supermarket, or a "smart" shelf informing staff to replenish the selection of cream cheese, or a mini-PC attached to the shopping cart, letting shoppers scan their own purchases, call up bargains and navigate the store.

No, these gizmos aren't science fiction; they're cutting-edge IT retailing systems that are being tested in a supermarket in Rheinberg, Germany. The store is serving as a retail laboratory for its owner, Metro, with about 40 hardware and software partners from around the globe. And it's raising some eyebrows in the industry.

The collection of applications in Metro's Future Store initiative aims to boost store efficiency, through such improvements as enabling targeted marketing and ending long queues.

Not everything in the Future Store will find its way into the market. After all, this an experimental store, but it's one that involves real customers using real technology in real time. And it's run by the fifth-largest retailer in the world, with 2,300 stores in 26 countries and sales of $54 billion in 2002.

Even hardened, retail technology executives acknowledge that the prospect of testing and refining multiple technologies in a retail setting is enough to make their hearts pound. "This is a unique IT retailing experiment, and we're glad to be a part of it," says Dimitris Nikolatas, product manager of Cisco. Cisco is providing a lot of the hardwired and wireless IP infrastructure, including a content delivery platform that broadcasts audio and video content and data to any number of delivery points.

Leading-edge technology

Of all the technologies being tested, two stand out: wireless and radio frequency ID (RFID). The two are linked to just about every new technical gadget being tested in the store.

The 4,000-square-foot building is covered by a wireless LAN (WLAN), based on the 802.11b standard. The network links all mobile devices, such as personal shopping assistants (PSA) and PDAs, and some stationary devices, such as electronic shelf labels (ESL), checkout points and flatscreen displays for product promotion.

The PSA is, essentially, a mini-computer attached to the shopping cart and linked directly to the WLAN. Manufactured by Wincor Nixdorf International, the PC includes a touchscreen with an integrated scanner that lets shoppers scan their purchases for quick payment at the checkout point. Purchase data is transmitted over the WLAN to the checkout terminal. Shoppers give the clerk their reference number assigned by the PSA and pay without emptying the shopping carts.

Click to see: Tracking goods

Store employees are equipped with PDAs. The Future Store is testing HP's iPaq 5450 and 3970 models and Symbol Technologies' PDT-8100. The handheld devices run Windows Pocket PC operating system.

Linked to the WLAN, the PDAs let employees check inventory or reorder goods by accessing Metro's merchandise management system and from anywhere in the store. The next phase of development calls for the PDAs to receive "soft phone" features, letting staff make calls in addition to sending messages or downloading information, according to Nikolatas. The service will be based on voice-over-IP technology, as are all other hardwired and wireless in-store communication systems.

While ESL technology isn't entirely new (the technology has been around for almost a decade), its prohibitive cost had prevented widespread use.

Almost all the products in the Future Store have electronic labels. These labels receive price information directly from the merchandise management system via the radio network using base stations in the ceiling. Price information is transmitted simultaneously to the shelf and checkout point to avoid price differences because of erroneous labeling. The price labels are equipped with an easy-to-read digital LCD, battery and radio receiver.