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Advantages of Using QR Codes in Retail

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Plain jane Bar codes are passe – the era of quick response (QR) codes is here. These small B&W squares have captured the imagination of retailers and marketers alike due to the huge amount of information they can hold. amazingly, the QR codes can be read by the smart phones of customers, which gives retailers a whole new channel to connect with the potential buyers of their products. Are you by any chance missing out on this fantastic new technology?

The new-fangled technology of mobile marketing (M-marketing) is particularly significant in the Indian scenario due to the increasing number of smart-phone users with Wi-Fi connections. The potential it offers retailers is enormous, considering the constraints of Web-based connectivity in the Indian hinterland. Over the last few years, technology has introduced many products which can be used to reach the consumers. One such innovation is QR codes – short for Quick Response codes – originally created by a Toyota subsidiary in 1994 to track auto parts. The QR codes are similar to bar codes used currently by retailers to track inventory and price products at the point of sale. The only difference is the amount of data that they can hold.

It is surprising to see the quantity of information a two-dimensional black-and-white matrix barcode – the size of a postage stamp – can contain. The code can be read by a QR code scanner or a smart phone which has the application to read it. The main advantages of QR codes over traditional bar codes include their error-correction capability and the ability to add information at different stages of the supply chain.

QR codes can be read at any angle, reducing the cycle time of any process. Once the QR barcode image is created, it can be printed on nearly any surface and location – newspapers, TV ads, billboards, temporary tattoos, product packaging, clothing labels, and more. QR codes can be used for nearly any function – logistics, advertising, customer service, etc. – for B2B and B2C across a variety of industries.

The QR code system consists of a QR code generator and a QR code scanner. The use of QR codes is license-free and many free QR code generators and reader software are available online. Working with QR codes is fairly simple. Any smart phone with a camera coupled with a decoding application can serve as a QR code scanner. The QR code image captured by the camera is then decoded and transmitted to the mobile phone for further action.

A potential application of these codes is in extending shopping hours. The QR codes printed on display windows or shop shutters can direct consumer traffic to the retailer’s e-commerce site, taking advantage of the on-the-spur purchases outside of regular shopping hours.

QR codes can also be used to supplement the retail space. Retailers can direct traffic to order out-of-stock items or non-regular sizes. The codes can be used to link to product demonstration videos of fitness products, sports goods, hardware, etc. Consumers can be directed to specific category/product review sites so that they can make their purchasing decisions on unbiased opinions.

QR codes when incorporated with tracking tools can gather data for market analysis. Retailer can use these to obtain detailed metrics such as demographics, repeat scans and geolocation so that client engagement can be more meaningful with customised offerings.

The usage of QR codes is not limited to consumer analysis and engagement. They can be successfully integrated into supply chain/back- end retail processes to improve stock accuracy and availability. The maximum potential of QR codes can be realised by implementing them from the initial link (the supplier) to the last link in the chain (the consumer). The information gathered at different nodes can be analysed to enhance the visibility and efficiency of the supply chain.

Piracy/counterfeiting is one of the problems faced by the Indian retail sector. The integration of QR codes with ERP can identify the interfaces from where the counterfeits are entering the supply chain.

The possibilities of QR code applications in the retail sector are many. However, jumping onto the QR bandwagon without a properly planned and integrated marketing strategy can be counter-productive. A lot depends on how the retailer strikes the right balance between different mobile marketing channels.

About the Author
Aruna Sanagavaram is a certified supply chain professional and researcher with interest in the dynamics of the Indian retail industry.

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