VDC Research: RFID, Barcode, Retail Automation & Self-Service Market Blog

Barcode Technology Innovations Coming to the Forefront Early in 2013 – Part 2

In Part 1, I highlighted some new product announcements from the barcode scanner vendor community and what these mean for the competitive landscape in general. Here in this post, I will focus on innovations in the barcode printer marketplace and how vendors are positioning their portfolio for success in today’s challenging global macroeconomic environment. Vendors’ research and development efforts are not limited to any one form factor, as evidenced by these product introductions.

1. Zebra Technologies: As the undisputed market leader in the barcode printer landscape, Zebra has successfully leveraged its extensive resources to build out a formidable product line that addresses current and emerging market requirements across a wide range of vertical markets and installation environments. The Company is working to expand its presence in emerging country markets with ongoing investments toward expanding its product portfolio. Zebra launched two MFi (Made For iPhone) certified printers to its already extensive mobile printer offerings – iMZ220™ and iMZ320™ – designed to support printing applications including receipts, tickets, proof of delivery and invoices. Aside from iOS, these solutions are fully capable of also supporting other leading mobile device platforms including Android™, Windows® Mobile and Blackberry OS. In VDC’s opinion, this move will help the organization maintain and also strengthen its leadership position in the portable thermal printer market while also enabling printing support for increasingly popular consumer handhelds.

2. SATO: The market leader in Asia-Pacific, SATO has a much smaller presence in other regions. With its acquisition of Argox in 2011, the Company aims to successfully penetrate the existing low-cost market opportunity in Latin America and Asia-Pacific, with a product line that effectively challenges emerging competitors such as TSC Printers. SATO America recently announced the launch of their Value Line of printers designed to fulfill application requirements of emerging and industrial markets. This includes CP-2140Z, the OS Series and the X Series of printers, capable of supporting applications in industries ranging from retail and transportation to health care and hospitality. The Value Line products are particularly aimed at price-sensitive users looking for cost-effective investment options.

3. Printronix: With a strong focus on the stationary industrial thermal barcode printer market, Printronix continues to work on building out its channel and vertical market reach with strategic alliances and new product introductions. The company’s printers support high-volume, mission critical barcode labeling applications in the industrial market. Printronix rolled out the entry-level T2N series of thermal barcode printers in the first quarter of 2013, pricing it aggressively at below $1,000 for the 203 dpi model. These printers are targeted at application environments including distribution, logistics, manufacturing, retail and health care.

2013 has got off to a very impressive start in terms of product innovation for the barcode technology market. While vendors strive to stay ahead of their competition with these new product introductions, the true winners here are the enterprise end users who are being afforded more choice and options.

Datalogic Reaffirms Stationary Point-of-Sale Leadership Position with Launch of Magellan 9800i

Vendors and users have long compared and contrasted the speed and performance of laser-based scanning with camera-based imaging solutions. Improved functionality, lower costs and enhanced barcode scanning speeds have all contributed to the widespread installation and integration of imagers to support several applications in varied markets. Successful penetration in high transaction volume environments has been non-existent, particularly given concerns surrounding their relative inability to maintain high throughput without compromising on features including, say, image quality. Until now.

At NRF 2013, VDC witnessed live demonstrations of two multi-plane bioptic scanner-scale products – by Motorola Solutions Inc. (MSI) and Datalogic – featuring a 100% digital, camera-based imaging data capture solution. Seeing these scanners in action highlighted all the attributes and characteristics that make them viable contenders to replace laser-based bioptic scanners in high-volume retail settings. Since we wrote about MSI’s MP6000 here, the focus of this post is going to be the Magellan 9800i, Datalogic’s latest bioptic scanner-scale.

The top-down scanner design of this imager enables attendants and cashiers to scan items at any angle without resorting to manual orientation. Like with MSI’s product, this Magellan version also provides support to a customer-facing mobile reader enabling customers to scan their mobile coupons, loyalty cards and others without disrupting the transaction and/or scanning process. Datalogic is the undisputed leader in the Stationary Point-of-Sale Scanning market with an extensive product line encompassing several different form factors – Bioptic, Presentation and Mini-Slot – while maintaining a sizable lead over the rest of its competitors in the space. The company has, over the years, fostered strong ties with leading retailers and integrator partners (including NCR and Wincor Nixdorf), pushing out its diverse scanning line to support multiple applications on the retail store-front. With the Magellan 9800i, the company is offering a migration path for its installed base to move from laser-based high-speed scanning to imaging solutions.
 
In VDC’s perspective, it will be interesting to see how the company makes use of its unique position in the industry with an extensive in-house expertise deploying imagers in industrial environments – in manufacturing and logistics verticals – to provide it with a distinct competitive advantage in retail. Will Datalogic be among the first vendors to bring “machine vision” from factory automation to retail applications?

Motorola Solutions Looks to Capture Retail POS Share with New Bioptic Imager

By all accounts, 2013 seems very eager to live up to its promise of being an interesting year for the barcode technology market. To start off, Motorola Solutions Inc. (MSI) made a new product announcement today – the multi-plane 100% camera-based bioptic imager/scale MP6000 – the company’s first foray into the high-volume stationary POS scanning market. What makes this particularly interesting is that up until today, Motorola was the only player from among the BIG THREE in the overall barcode scanner market (the others being Datalogic and Honeywell) with no stationary POS offering for high-throughput retail environments. We expect MSI to sell this product into grocery stores, supermarkets, hypermarkets, mass merchandisers and other such big box retailers. MSI credits its customer-side scanner to be one of its biggest competitive differentiators in an “almost exclusive” bioptic scanner market essentially governed by 3 players – Datalogic, Honeywell and NCR. Motorola’s scanner enables customers to simultaneously scan their own coupons, gift cards and loyalty cards, including those displayed on smartphone screens, with the attendant/cashier facilitating the POS checkout process.

Motorola has established a strong presence for itself in the camera-based, 2D imaging solutions market, particularly with the handheld form factor. VDC’s research covering the space indicates that the company has made significant strides in capitalizing on the explosive growth opportunities that this 2D solution configuration has to offer, especially given end users’ critical requirement to future-proof their technology investments. With continued advancements in 2D performance, Motorola considers the high transaction volume retail market to be primed for a switch from a laser- to a fully camera-based bioptic scanning solution - one that can lower operational costs and enhance data capture efficiencies.

While this is all great news for retailers and the barcode industry doing away with triopoly in this specific technology segment, it will be interesting to see how Motorola prices its newly introduced product. Although the performance of camera-based imaging solutions has improved drastically versus laser technology, pricing is not an apples-to-apples comparison given the increased complexity and high cost of underlying solution components. Will the company’s success with imaging on the handheld side translate to an equivalent achievement with the stationary form factor? This remains to be seen. In our opinion, Motorola will initially target large, Tier-1 retail chains with this product; small-and-medium sized businesses still have to wait their turn, particularly with the (anticipated) pricing structure. My expectation is that Motorola’s success mantra in this market just might be an increased focus on profitability over sales volume – due to the higher associated margins for this brand new product in its portfolio – positioning the company as a one-stop shop to fulfill their retail customers’ barcode scanning as well as future EAS and/or RFID requirements.

VDC Research's 13 AutoID Predictions for 2013: Barcode, RFID & RTLS and Mobile Customer Engagement Technologies

Happy New Year! On behalf of the AutoID team and all of VDC Research Group, we wish you all the
best in 2013.

Although 2012 has just concluded, it is never too soon to look ahead. So to start the new year off in an interesting way, the AutoID team has taken out our crystal ball once again to offer 13 predictions for the AutoID market in 2013, including Barcode, RFID & RTLS and Mobile Consumer Engagement Technologies (MCET). They are presented in no particular order.  

1. Barcode: More market aggregation ahead – Expect continued consolidation of the barcode
   hardware landscape, particularly to achieve growth across following dimensions:
   • Regional – Vendors seeking to grow their presence in emerging country markets,
     particularly targeting barcode printer and scanner vendors based out of
     Asia-Pacific.
   • Vertical – Vendors looking to increase their proliferation into high-growth industry
     verticals – particularly healthcare.
2. Barcode: Vendors will learn to “accessorize” – More barcode hardware players will actively
   look to enter the “accessories” market – developing sleds and/or sleeves to support consumer-grade device usage in enterprise environments. This is particularly relevant to vendors addressing customer-facing applications with their devices in retail, healthcare, hospitality and commercial services. 
3. Barcode: Future with mobility, not without in software market – An increasing number
   of barcode software solution providers will extend label printing support to portable devices (both purpose-built and consumer-grade) – facilitating mobile applications such as field sales, field service and direct store delivery (DSD). Today, mobile barcode label generation software penetration is in a very nascent stage, but we expect that to quickly change. Mobility IS the way forward across verticals and industries and the entire barcode value chain must and will respond accordingly.
4. Barcode: Embrace the tech-savvy consumer – Scanning with and displaying barcodes on mobile device screens will continue to grow significantly among consumers. Barcode vendors and their enterprise and retail customers must continuously adapt to this explosive trend. We predict more QSRs (quick service restaurants), convenience stores, restaurants, theme parks/ entertainment venues and other consumer-facing enterprises will invest in and deploy barcode imagers and consumer-grade mobile devices to interact with consumers (e.g., coupon redemption, payment, loyalty/rewards programs).
5. MCET: Mobile point-of-sale (mPOS) will remain the hottest technology among B2C business operators – This trend will be most prominent in retail, but increasingly in dining as well, despite the fact that enterprises often lack clear strategic objectives guiding their investment in the same. In 2013, MCET solution providers must assume leadership roles in educating their customers on technology selection, software and security, best-fit use cases for specific mobile devices/form factors and total cost of ownership (TCO).
6. MCET: NFC as a broader ecosystem will make little progress beyond incremental gains in
   shipments of NFC-enabled smartphones – Yes, this means more NFC-equipped phones in consumer hands, and limited scale pilots and tests will continue, but 2013 is not the year when the technology gains global-level traction. However, expect more TV commercials for mobile phones and mobile network operators (MNOs) to advertise NFC and its applications – and more importantly, look for more commercials to specifically mention the term “NFC” in order to engrain the technology in consumer minds.
7. MCET: Merchants’ general focus on mobility - mPOS in particular - will bring great opportunity for vendors of adjacent peripherals – POS peripheral vendors (e.g., receipt printers, barcode scanners, payment solutions) are expected to drive growth via innovative, highly-portable versions of these traditional POS extensions. These vendors will be jockeying for competitive position more aggressively in 2013, responding to burgeoning demand among retailers, restaurants, hospitality and other enterprises wanting to differentiate and augment their systems by  “going mobile” at the POS.
8. MCET: Contactless mobile payment via NFC will not explode in popularity among consumers during 2013, but consumer usage and merchant support of this application will experience strong growth – Barcodes displayed on mobile device screens and core/traditional RFID (e.g., contactless tickets, smartcards) – not NFC – will continue to enjoy broader global support for mobile payments in the foreseeablefuture. For NFC to gain ground in 2013, more NFC-enabled devices must reach consumer hands, more NFC-compatible payment terminals must be deployed and more collaboration among invested parties must occur within the NFC ecosystem (especially in terms of consumer education, transaction fee negotiations/resolution, and application development).
9. RFID & RTLS: Vendors – especially RTLS solution providers – will develop the “healthcare
   stare” – The use of RFID and RTLS is on the rise in healthcare, most notably in the US thanks to the VA’s announced $540M+ contract to track equipment and supplies at 21 of its Veteran Integrated Service Networks (VISNs).  However, the contract award to HP was not met without controversy in 2012 as IBM filed a protest to the US Government Accountability Office (GAO) and won the decision. The contract will be rebid among, at least, the six original bidders.  This spark to the market (and sizeable contract) drew a lot of attention in 2012 and we expect the RFID and RTLS frenzy to continue in healthcare in 2013. However, we caution vendors (especially RTLS providers) to not focus solely on healthcare and to seek opportunities and market development in other vertical markets where the competitive field may be less crowded.
10. RFID & RTLS: Passive UHF EPC item-level tagging (ILT) in the apparel sector will
    pick up the pace after a somewhat slow 2012 – This past year was a mild disappointment in terms of retailer deployment of RFID for ILT of apparel. For example, no major reader or printer/encoder orders were delivered, several large retailers remain behind originally announced plans (e.g., Wal-Mart, JC Penney) and some newer programs were pushed to or will start in 2013.  So what to expect in the year ahead? Even more American Apparel stores will go live with RFID (a bright spot for 2012 as well), Wal-Mart will reassess its RFID plans but remain committed, Macy’s will make its anticipated move, JC Penney has bigger worries than RFID, international retailer Zara will play a key role in increasing tag volumes and RFID EAS will become a more critical part of the ILT in apparel conversation.
11. RFID & RTLS: Embedded RFID keeps the forward momentum – At the end of 2011 we
    noted the rise of “RFID inside,” or embedded RFID, as a key trend to watch for in 2012.  We are keeping it on the list in 2013 after seeing a great deal of progress in 2012. For example, ThingMagic released a new, smaller passive UHF reader module, Xerafy continued product development for embedded RFID specialty tags (e.g., tools), ICs and chipsets from players such as Impinj, NXP, Murata and AMS decreased their footprints, Coca-Cola Freestyle dispensers with passive UHF technology inside continued deploment, RFID and NFC made their way into consumer devices such as Keurig Vue coffee brewers and Nintendo Wii (Skylanders game) and much more. With price points declining and form factors shrinking, we expect to see solutions and applications such as these expand and new innovations to be introduced in 2013.
12. RFID & RTLS: Honeywell Scanning & Mobility will get strategic on RFID – and quickly
    – after announcing its first RFID product and the acquisition of Intermec in 2012 – After some exploration of RFID while acquiring several barcode scanner and mobile computing companies over the last few years, Honeywell made some eye-catching RFID moves in 2012. They made a subtle move in introducing an RFID reader and then made a major move in announcing the acquisition of Intermec (a major RFID IP holder and RFID equipment manufacturer). We predict Honeywell will aggressively develop its RFID strategy in 2013, becoming a strong competitor in select verticals and applications that play to the combined strengths of Honeywell and Intermec. What’s next for Honeywell – RTLS in 2013 or 2014?
13. AutoID: Governments in China and the EU continue to connect with the concept of the Internet of Things (IoT) – While the US government remains largely silent, China and
    the EU actively fund research IoT projects, create policies to govern the IoT and deploy IoT technologies (including RFID, NFC and sensors). Much of the IoT activity in the US has been at the city level (e.g., smart cities) and we do not expect that to change. In looking ahead and predicting where will be the epicenter of IoT innovation, we are placing our bets on China. Simply look at what is on the list of IoT development subsidy projects from China's Ministry of Industry and Information Technology and Ministry of Finance (announced November 2012). UHF and microwave RFID chip design, product technology R&D, miniaturized intelligent sensor technology R&D, ad-hoc networking technology for wireless sensor networks, intelligent logistics and intelligent traffic are among the 14 categories of project, comprising 149 projects in total, which will receive support from the government.

I would like to extend a special thank you to Richa Gupta (VDC’s barcode analyst) and John Shuster (VDC’s MCET analyst) for their contributions to this blog.

France-based m.Wallet Consortium Leader Chooses Barcode, not NFC

Auchan, a leading French supermarket chain, announced plans to launch a cross-merchant m.wallet app called Flash ‘n’ Pay (FNP). The FNP app will be very similar to the one currently in development at the Merchant-Customer Exchange (MCX), which we discussed in a previous post. Like MCX, the FNP app can be used with all credit/debit card brands, supports loyalty cards and is MNO and issuing-bank agnostic. FNP also shares the same enabling technology as MCX—the app will be barcode-based, not NFC.

Whereas France is among the countries leading European NFC adoption, one might understandably assume that a retailer-led m.wallet app designed for that market would be NFC-based, not barcode. However, NFC faces many of the same fundamental challenges to mass adoption in France that it does in most other countries: 

• NFC-based apps cannot be used by many current smartphone users—barcode is accessible to virtually all
• NFC-based payment requires cooperation across multiple stakeholders—barcode does not
• Barcode-based apps are easier and less costly to support—and many B2C merchants already have the requisite 2D imagers installed at the POS

Certainly, NFC adoption in France is stronger relative to most other national markets, thanks in large part to the French government’s recent commitment to fund contactless transportation infrastructure in approximately 15 cities. However, NFC’s long-term potential as a B2C commerce enabler in France—and in most countries, save for a select few in Asia-Pacific—remains highly uncertain.

We view Auchan’s selection of barcode for its m.wallet as a particularly noteworthy development by virtue of its regional context. If an NFC m.wallet is not viable for a French retailer, in which countries is it?  From our perspective, the FNP announcement demonstrates how far NFC has yet to progress before it attains mainstream status, even in the countries/regions where adoption is relatively strong today.

AutoID Market Shakeup - VDC's Thoughts on Honeywell Acquiring Intermec

At VDC, we have now, in a way, come to expect big acquisition-related news towards the end of calendar years – case in point, Datalogic’s acquisition of Accu-Sort and SMARTRAC N.V.’s acquisitions of UPM, KSW and Neology in Q4, 2011. Throughout 2012, VDC has talked about how we expect to see leading players in the space – for both barcode scanners and printers – to consider consolidating their competitive landscape and strengthen their leadership position in existing markets while also tapping into adjacent high-growth market opportunities. On December 10th, 2012, Honeywell International Inc. (NYS: HON) did just that – announcing its acquisition of one of the global leaders of AIDC solutions, Intermec (NYS: IN), for approximately $600 million in an all-cash transaction. Intermec is the only company involved in the development, manufacture, sale and integration of all core AIDC technologies (barcode scanners, barcode printers, RFID, rugged mobile computers, etc.), thereby giving enterprises with AIDC solution requirements a “one stop shop” alternative. Our focus in this blog post will be on highlighting the impact of the company’s acquisition on the barcode and RFID markets.

From a strategic perspective, some of the key benefits that Honeywell can leverage via this acquisition include:

1. Honeywell has registered strong performance in the barcode scanning market since its acquisitions of Metrologic Instruments and Hand Held Products in the last decade. The company, however, has had an extremely limited presence, if at all, in other AIDC markets. It is only in May 2012, for example, that Honeywell’s AIDC division launched its first RFID-enabled device – the Optimus™ 5900 RFID mobile computer – capable of reading EPC Gen2 and ISO 18000-6B RFID tags. With this deal, the company has bought an immediate entry into several adjacent technology markets given Intermec’s relatively strong play in barcode and receipt printers, consumables, RFID printer/encoders, RFID readers, and other hardware. VDC considers Intermec’s strong IP (intellectual property) in the RFID market to have been a crucial decision driver for Honeywell especially as the company looks to capitalize on new, high-growth opportunities in this multi-billion dollar market – most notably in the Manufacturing and T&L verticals.
2. Intermec’s value proposition as a “one stop shop” for AIDC resonates, in particular, with warehouse and manufacturing IT professionals looking to standardize on one branded platform. The company has also been investing resources towards building out its presence in the health care services market – with new product introductions and channel alliances. This acquisition thus gives Honeywell significant leverage in these vertical markets.

Despite all these synergies, VDC expects Honeywell to face stiff challenges as it looks to revive Intermec’s financial performance in its key markets – across regions, verticals and technology segments – and minimize the revenue impact of economic volatility in Europe. The company has, however, been very active with new product introductions across its barcode scanning and printing portfolios over the past 6-12 months, showcasing a continued focus on research and development initiatives.

The deal is a very strategic move by Honeywell and certainly shakes up the competitive landscape in the AutoID market. The addition of Intermec’s large installed base of customers and channel partners to its own positions the company for continued success in increasingly difficult and demanding operating conditions. Questions remain on what this means for Intermec’s employees, product lines and channel. And we will have the answers for you once this acquisition closes out in 2013.

VDC Heads to the Big Apple for CET World 2012

The VDC AutoID team was in the Big Apple on Wednesday for the 2012 edition of Customer Engagement Technology World (CETW). Despite the recent hardships caused by Hurricane Sandy last week, this year’s show went on as scheduled and drew the usual, diverse crowd of vendors and end-users that attend CETW. Although the show floor was somewhat dominated by vendors of kiosk and digital signage hardware, software and solutions, other areas of the CET spectrum—including POS/mPOS terminals, consumer-facing mobile apps and customer analytics—were also well represented. Our observations at CETW 2012 left us with a several takeaways:

• Self-service solutions are alive and well. As we discussed in a recent post, during the past 12-18 months we have observed a certain level of anti-self-service sentiment among some end-user verticals, including restaurants/dining and retail. While there are definitely examples of enterprises that are moving away from self-service solutions, including self-checkout, kiosks and some forms of interactive displays, these particular instances are not indicative of any mass migration away from these technologies. In fact, these self-service solutions continue to evolve and progress in regards to their functionality and ease-of-deployment. Companies such as NCR are developing more capable and more easily-integrated self-service technologies, such as their NetKey offering.
• Merchant/retailer interest in mobility solutions continues to build. The concept of mobility—whether in the context of m.POS, m.payment or any other enterprise application—continues to build momentum. In regards to m.POS and m.payment especially, it seems these concepts have become so trendy as of late that some end-users are evaluating investment in them simply due to the buzz surrounding them. Several mobility vendors we spoke with at the event noted they are hearing from an increasing number of merchants who want to invest in m.POS/m.payment solutions—but have not defined the objectives for their deployment of the same. While these cases may be more of an indictment of the technology strategy—or lack thereof—at the merchants in question, we also see it as a strong indicator that retailers have generally acknowledged the value mobility provides in many applications.
• Personalized communications/offers that cater to individual preferences are a good start, but there is still a long way to go. For example, to engage a customer and maintain his/her loyalty it is equally important—if not more so—to avoid suggesting things that a customer may dislike or find offensive. Similarly, context and timeliness of communications are also important dimensions to consider—as events such as birthdays, anniversaries, or (to cite a timely example) storms and other natural events may have important implications for what a consumer wants—or does not want—to hear from a merchant. Clearly, tailoring communications to this level of precision is far more complex and challenging than simply making add-on sale suggestions or deal offers based on past purchase history—but with the increasingly advanced capabilities of analytics and other data-management tools, it is not an impossible task. 

For VDC, CETW 2012 was an informative, interesting and timely event, particularly as we prepare to launch its new MCET research program in the upcoming months. Contact us for more information about that research, in which we will discuss the above trends and many others impacting merchants and the technology providers that serve them.

Think Self-Checkout is Dead? Think Again.

During the past 18 months or so, we have observed a decidedly negative attitude towards the future viability of Self-Checkout (SCO) solutions in US retailers. Throughout 2011 and 2012, a number of large grocery chains—including Kroger and Albertsons—announced SCO lanes will be replaced with old-fashioned staffed lanes instead. The retail technology blogosphere has also joined the anti-automation bandwagon, with articles frequently bemoaning the clunky operation of early solutions and their perceived job-killing effect. Despite this anti-SCO sentiment, many store chains across all retail sub-verticals continue to offer SCO as a checkout option. In fact, some merchants are actually increasing SCO investment. This week, NCR announced it will deliver 10,000 additional SCO stations across WalMart’s 1200 US stores during 2013. Financial terms of the deal were not disclosed, but, based on VDC’s most recent AFSP data, we estimate the value of this contract to be approximately $150-160 million.

Notwithstanding its abandonment by certain retailers, SCO remains a useful technology when deployed in appropriate retail settings. Like any other solution, it has certain vertical/sub-vertical applications to which it’s well-suited, and others it’s not. While certain early SCO systems were buggy and difficult to use (we have experienced them ourselves), modern offerings have largely addressed these shortcomings, offer time-strapped shoppers an attractive alternative to waiting in line and often complement other retail solutions such as Personal Shopping Systems. VDC therefore believes SCO will remain an important component of many retailers’ broader front-end technology solutions, particularly in grocery/supermarket, mass merchants, wholesale clubs and home improvement stores.

In regards to WalMart’s upcoming SCO rollout, we expect its investment decision was motivated in part by the retailer’s ongoing experimentation with customer-operated mobile shopping apps. Specifically, WalMart is one of the founding members of the Merchant Customer Exchange (a consortium of more than 20 US merchants working cooperatively to develop an interoperable, cross-brand mobile wallet) and also recently announced small-scale pilots of a smartphone-based self-scanning app. As these two initiatives progress—and if/when they move towards full-scale deployment—we expect self-service technology like SCO will play a key role in their day-to-day use by customers. Convenience and time savings are two of the key value propositions these mobile apps offer, and both are strengthened by the presence of SCO as a checkout option. Accordingly, we expect to see SCO defend its established place within the retail automation spectrum, especially among technology-embracing merchants like WalMart . Furthermore, by virtue of its recognition as a retail sector leader, WalMart could give its SCO-doubting peers reason to reevaluate their own automation strategies.

Datalogic Celebrates its 40th Anniversary

This week, Datalogic, a global leader in the market for barcode readers, mobile computers, machine vision systems, personal shopping/self-scanning systems and other AutoID solutions is celebrating its 40^th anniversary. During its infancy in the early 70s, the Company specialized in the manufacture of photoelectric sensors for the textile, ceramics and packaging industries, but via ongoing investment in in-house R&D and strategic acquisitions, Datalogic’s product portfolio has steadily expanded to include a spectrum of AutoID solutions. During four decades of operation, the Italy-based Company has also vastly increased the geographic scope of its business, expanding from its original European focus to become a truly global AutoID vendor.

While Datalogic has maintained an international presence across EMEA, Asia-Pacific and the Americas since the 80s, the Company has historically been strongest in its home European market. However, over the past 18 months, Datalogic has made a concerted effort to fortify its competitive position in the Americas, particularly within the US market. To achieve this goal, the Company recently completed two significant acquisitions—PPT Vision, a supplier of machine vision solutions, and Accu-Sort, a vendor of industrial scanning and imaging solutions.

Not only have both of these acquisitions materially boosted Datalogic’s market share within each respective technology market; they also have afforded the Company instant access to well-established regional distribution networks and new application/vertical opportunities. Via the Accu-Sort transaction, Datalogic became the stationary industrial barcode scanner share leader in the Americas, according to VDC’s data. VDC expects the Company will continue to strengthen its presence in that region as it integrates these two acquisitions and fully harnesses the operational and sales synergies they offer.

Looking to the future, VDC believes Datalogic will continue to build its presence in the AutoID markets via pursuing additional complementary acquisitions, logical expansion into adjacent/emerging technologies and maintaining its position as an AutoID innovator through ongoing R&D investment.

 

 

Urban Outfitters CIO Says Its Checkouts are Going Fully Mobile

In a recent post, we discussed the impact mobile POS adoption is having on the broader POS market, particularly in the context of stationary POS heavyweights like NCR, IBM, Wincor-Nixdorf and the like. Long story short: m.POS has proven itself to be a valuable retail tool during the past 18-24 months, and has reshaped the POS competitive landscape as a result. An increasing number of merchants are investing in mobile POS, and in doing so, are disrupting some long-established conventions in retail automation technology. Urban Outfitters (UO) is among the latest examples of retailers that have committed to m.POS—and this particular apparel retailer has done so in a big way. The Company’s CIO announced last week that its stores will abandon stationary checkouts and go fully mobile in the near-term.

Urban Outfitters is no m.POS newcomer, having used mobile POS in its stores for approximately two years. However, its shift to a fully mobile checkout strategy marks an unprecedented level of commitment to the technology for the company. Until now, UO deployed mobile POS only as a complementary solution alongside its traditional, stationary terminals. As with its earlier deployments, UO’s chain-wide m.POS rollout will use iPad and iPod touch devices running an application that supports returns/exchanges, stocking, inventory inquiries and special orders—in addition to standard checkout and payment functions, of course.

As is typical with m.POS deployments, UO cited improving customer experience and empowering employees as key factors driving the transition to a 100% mobile POS solution. Interestingly, UO also acknowledged the cost advantage of mobile vs. stationary terminals—something most retailers do not mention when discussing their mobile investment. According to the Company, its iPad-based terminals are approximately 1/5^th the cost of a standard stationary terminal, while iPod-touch based units are only 1/10^th. Obviously, the lifecycle of consumer-grade devices will not match that of the more robust enterprise-grade POS terminals, but we wonder exactly how much more frequently the iPad/iPod touch will be need to be replaced.

While VDC believes in the value, utility and long-term viability of mobile POS in retail and other types of merchants (especially hospitality, including QSRs, fast casual and table service restaurants) we are not sold on the notion that mobile POS is a universal replacement for traditional, stationary checkout. Certainly, some brands and store formats (e.g., Apple Stores) are well-suited to going fully mobile. Conversely, such a move could be entirely disastrous in other merchants for a variety of reasons, including large average basket sizes, store size and layout, for example. That being said, we think Urban Outfitters’ store size, layout and brand image bode well for a successful transition to an all-mobile POS strategy. Mobile POS is one of the markets VDC will be tracking in our 2013 MCET research. Click here to learn more.