Shoplifting is retail’s eternal headache. According to NRF’s National Retail Security Survey, there were losses of nearly $47 billion in the United States alone in 2017. It’s a dilemma: The easier products are to access in stores and the more seamless the checkout experience, the greater the conditions for theft.
While putting high-value items like baby formula in locked cabinets may not be convenient for consumers, some retailers choose that rather than see thefts increase. Companies have tried countless methods to counter shoplifting — increased and better trained security staff, hidden cameras, electronic article surveillance — but these can only do so much. That’s where big data comes into play.
With nearly 650 locations, U.K. supermarket chain and Walmart subsidiary Asda has tried to be at the forefront of loss prevention. In 2017 it worked with Tyco Retail Solutions to roll out Tyco’s Shrink Management as a Service technology in its EAS systems.
“If you look at a traditional EAS system, merchandise is tagged with a sensor that’s removed at the purchase. If someone walks out the door with the sensor attached, it sets off an alarm,” says Sean Lee, U.K. retail director for Tyco Retail Solutions. “With SMaaS there’s a capability to collect data about these alarm triggers, which allows a retailer to see trends and act accordingly.”
“It seemed like a logical move for us,” says Andrew Rees, Asda’s senior manager for asset protection. “We’re always looking to be on the edge of technology, but we’re also practical. We weren’t going to make a change just because it was a new system. It fits with the replacement schedule for our EAS systems.”
While EAS systems have been proven effective, they’re also limited: The alarms they set off let store personnel know of an issue, but the incident often goes no further. Staff and customers assume a mistake has been made and the customer returns to the point of sale or continues out the door, no questions asked.
In Tyco’s system, the EAS is connected to a Google cloud-based program that collects the number, frequency and location of each alarm. The data is then available to allow retailers to see shoplifting patterns.
The Tyco systems are being installed over a five-year period in Asda stores, with upgrades to each location’s network as necessary to connect it to the cloud-based system. “From what we’ve seen in our SMaaS-connected stores, we’re looking at some significant reductions in our shrinkage in the years ahead,” Rees says.
“We can see the number of alarms per door per hour, sensors that haven’t been deactivated that set off alarms, and you can also view the number of foiled detections, people leaving the store with booster bags to hide products from the EAS,” Lee says. “We can even break it down into individual alarm categories and come up with an average loss per alarm that the retailer can quickly see on their dashboard.”
“You can see peaks and valleys of criminal activity in each store and test how various security methods are working,” he says. “If you’re seeing a reduction of alarms in a store with enhanced security, you can dive deeper to see what they’re doing in order to use it at other locations.”
“When I saw this being demonstrated I realized I’d been looking for something like SMaaS for a long time,” Rees says. “It gives us a holistic view of what is happening where in our stores’ loss prevention efforts. This will be invaluable going forward. We won’t be reacting on hunches — we’ll be reacting on what the data is telling us about our shrinkage.”
The system is also useful for controlling the “nuisance” factor of EAS. The sound of an EAS alarm generally doesn’t create much interest in a store because it’s not uncommon for sales people to fail to remove a sensor at the POS. Data from the Tyco system can show if associates are not removing sensors consistently, which may require more employee training. The ideal result is fewer alarms, and those that do go off notify staff that something has been stolen.
“It’s a reinvigoration of the EAS technology,” Lee says. “If the alarms go off less frequently, when they do go off it tells everyone there’s a problem and they’re more likely to pay attention.”
For Asda, Rees looked forward to what the alarm data would tell him about organized retail crime bands that hit stores in groups. “We wanted to see if we could track a pattern of these organized crimes. We have an intelligence center in our department where we can look at closed-circuit monitors of each store and see what’s happening with each alarm.”
If a group of stores has been hit by a particular group, Rees can see what’s happened on the system’s organized retail crime map and quickly notify police and security in neighboring stores. “It allows us to be more proactive in loss prevention and stopping thieves from causing too much damage,” he says. “We’re not reading a report of some stores that have been hit a few
EAS systems act as a deterrent, Lee says. “Shoplifters tend to be opportunistic,” he says. “They see the EAS antennas near the doors and they look for ways to avoid them, remove sensors, mask them with foil or use jammers. The biggest difference is that now we can harness the data created by all those alarms to reduce thefts.”
Asda has begun installing Tyco antennas near its self-service registers, and Rees believes this will help the company manage the theft problems that surround this type of POS.
“Customers really like self-service but so do shoplifters,” he says. “It would help to know how many alarms are going off because of a customer mistake where they failed to scan an item or if the person is deliberately trying to steal a product.”
For Asda, the introduction of the Tyco system is just part of the evolution. “Our whole business is becoming more focused on analytics and SMaaS seems like a part of the puzzle,” Rees says. “It’s critical these days to stay on top of the curve, and we feel that this will keep us in good shape for years to come.”
John Morell is a Los Angeles-based writer who has covered retail and business topics for a number of publications around the world.