In retail, change is constant. But with any new advancement comes the risk of a security breach. Take the Internet of Things, for example. It’s making experiential retail possible, but IoT devices are also susceptible to hacks. “IoT security is a huge issue, as retailers may not be aware of the level of security for every sensor,” says Margot Juros, research director for retail technology strategies at IDC. And this is just one part of the puzzle. The same is true, experts say, for point-of-sale cameras and artificial intelligence tools. The risks become exponential.
To ensure that security is strong, IT leaders must make sure “everything is linked properly together,” says James Stark, retail segment development manager at Axis Communications. “You have to have IoT and POS security devices to leverage AI, and you have to have AI to take full advantage of data analytics.” Innovation in retail isn’t possible unless all the tech is in sync, so for every new piece of tech deployed, there must be a security solution in place. This essentially means working towards a “holistic, ‘four-wall view’ security strategy. It involves much more than just zeroing in on one element or technology,” he says. It’s a wholly integrated mindset that promotes a systematic approach to security.
Here’s what IT leaders need to build a holistic strategy and the tech that can help them be proactive.
The Four Components of a Holistic Security Strategy
Shoplifting, organized crime, digital fraud and employee dishonesty are some of the biggest security threats facing the retail industry right now. It’s a lot to confront at once, which is why IT leaders should focus their efforts on these four tactics:
- Embrace AI technology. AI is critical to loss prevention tools such as enhanced video surveillance, radio-frequency identification (RFID), license plate readers, autonomous security robots and cash automation technology. And the global AI retail market is growing: It was worth $8.41 billion in 2022 and is expected to reach $45.7 billion by 2032, according to a study by Precedence Research.
- Invest in IoT security. Connected IoT security devices are easy entry points for cyberthreats, so “if you deploy IoT, make sure it’s segmented in the network with a zero-trust policy,” says Mark Scanlan, retail global industry lead at Cisco. But many retailers forget this step. In fact “over 84 percent of organizations use IoT devices. However, less than 50 percent have taken solid security measures,” notes a 2022 Forbes article.
- Increase the number of POS cameras. The more security at the POS, the better equipped retailers are to review patterns of exit from the store. Retailers can also use the cameras to analyze how procedures are followed and scan for security blind spots.
- Leverage data analytics to identify losses. With advanced detection of anomalies and real-time insights, IT leadership can identify where losses occur. This intel ensures that any change to a retailer’s security strategy is rooted in data-driven decisions. Data analytics can be used for loss detection, employee monitoring, fraud detection, predictive analytics and supply chain tracing.
How to Raise Your Security IQ
Building a holistic security strategy requires that IT leaders raise their security IQ. This means continually educating themselves on the newest tools and deploy and integrating them thoughtfully so as not to detract from the store experience.
Prioritization is key. Start with the biggest revenue loss area first. If retailers are experiencing loss at checkout, deploy POS cameras. If it’s lost inventory within the supply chain, try RFID. And if a retailer can’t track the exact source, try full-scale data analytics with AI to locate your vulnerabilities.
Look for two-in-one solutions. Any two-in-one technology will result in cost and time savings. Take for example the Cisco Meraki MV series smart camera, which can record store activity and also serve as an IoT security device if integrated with an AI model.
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Think about prevention. “One step every retailer can take is to invest in loss detection,” says Matthew Guiste, global retail technology strategist at Zebra Technologies. “This allows retailers to take low-risk and high-value steps to stem the losses, often before they happen.” With RFID and prescriptive analytics, retailers can “have a better chance of triggering actions to re-stock those items,” he says.
Use all the tools at your disposal. Eliminating silos is essential to achieving an integrated strategy. “All of these security tactics should be used in concert,” Juros says. Adjust security protocols as needed. Once the threats change, “you will need to adapt and pivot,” Stark says.
Embrace the human element. “In order for retailers to boost their security IQ, they must factor the human element into their strategy,” Stark says. After all, only a human can make tactical decisions and determine whether there’s a wide enough variety in their security suite.
Keeping a Perpetual Security Mindset
As the technology grows more sophisticated, it can be tempting to trust it entirely. But in reality, “people, processes and technology are at the heart of any security IQ operation,” Scanlan says. Automation, for example, is helping retailers “move from a reactive, human-based process to proactive detection of losses,” but AI, video, sensors and IoT still need regular monitoring and testing. The more interconnected the tools, the stronger those connection points need to be.
“There is no single silver bullet, but a holistic plan that includes cybersecurity and physical security is key to keeping retail secure,” Scanlan says.