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5G adoption in retail stores will triple by 2024, study says

An overwhelming majority of U.S. retailers are expecting 5G usage in their stores to explode over the next three years as customers look for more of a digital in-store experience, according to a new study conducted by Verizon and market research firm Incisiv.

According to the 2022 Connected Retail Experience Study, this will drive a rapid increase in 5G adoption in stores, to the point where it could triple by 2024.

A person holds a smartphone over another smartphone at a retail counter.
David Dvořáček / Unsplash

The study revealed that 93 percent of retailers are expecting in-store phone usage to spike in the next few years. Many are concerned with their ability to manage all that traffic, and will be turning to the deployment of private and hybrid 5G networks in their retail spaces to handle it.

In fact, Verizon and Incisiv believe that moving to 5G will be unavoidable for most retailers as they compete to provide customers with the best in-store experiences and the number of cloud-based store applications spikes in the next few years.

What’s pushing retailers the hardest is the increased number of customer mobile devices in stores, followed by the increase in mobile devices used by associates.

Existing networks can’t keep up

Although many retailers are happy with the security aspects of their networks, they’re far from satisfied with the core network performance, and that’s only going to get worse as technology deployments and the number of mobile devices both increase

Today, most retailers rely on traditional Wi-Fi networks, but these simply can’t deliver coverage and bandwidth nearly as efficiently as 5G technology can, especially in large retail spaces like grocery stores and department stores.

Some retail chains have dipped their toes into the 5G waters, but adoption remains low at only 13 percent. This is expected to triple by 2024-25, with the largest increase found in grocery and general merchandise retailers.

What 5G can bring to stores

Not all of these 5G deployments will be customer-facing, of course. Many stores are also looking to private 5G networks for real-time inventory management, mobile point-of-sale systems, digital shelf labels, robotics, and interactive displays.

Retailers interviewed for the study also cited a number of customer experience capabilities that 5G could help deliver, including support for cashierless checkout, mobile apps with in-store features, and even virtual dressing rooms and AR/VR assistants.

Not surprisingly, specialty and department stores leaned more toward things like mobile apps, interactive displays, mobile point of sale, and AR/VR applications, while grocery and general merchandise retailers focused on supporting cashierless checkouts, digital shelf labels, and curbside pickup applications.

According to the study, retailers believe that 67 percent of store tasks will be automated by 2025, with the need for low-latency 5G networks at the core of ensuring seamless real-time communications, but it’s just as much about meeting the needs of customers that are now expecting to live in a far more connected world.

As Jerri Traflet, Verizon’s managing partner of global solutions, explains: “Customers are demanding more in their in-store, mobile, and online experiences, and 5G provides the core capability to deliver those experiences.”

The biggest obstacle to 5G deployments among retailers has been the cost and lack of a clear return on investment, but as 5G technology becomes more affordable and their existing wireless networks begin to reach capacity, they’ll have little choice but to turn to 5G to meet the needs of their businesses.

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