Skip to main content

The connected store

Shop happier, work smarter

As the digital and physical worlds continue to converge, traditional in-store experiences are undergoing rapid, unprecedented change. Learn how retailers can leverage advanced technologies and real-time data to create the connected store—powering exceptional experiences across customers, associates, and the enterprise.

Unifying data and human decisions

As the digital and physical worlds converge, in-store operations are being reshaped by economic pressure, labor constraints, rising customer expectations, and the rapid adoption of AI. To compete, retailers must move beyond fragmented store systems and adopt a connected store operating model—one that turns store signals into actionable intelligence across the enterprise.

Retailers who win with the connected store do three things differently. First, they treat the store as a real-time operating system, not a collection of point solutions, evolving existing systems by layering new capabilities that unlock intelligence and extract greater value from investments already made. Second, they deliberately connect customer, associate, and enterprise experiences to move the P&L, not just to improve moments in the aisle. And finally, they sequence transformation pragmatically, progressing along the connected store maturity curve to compound value over time. In the new retail era, evolution is not optional; it is the difference between leading and falling behind.

What a connected store entails

A connected store is not defined by a single technology or platform. It is an operating model that drives revenue, margin, and productivity by intentionally connecting customer, associate, and enterprise capabilities across the retail ecosystem.

At its core, the connected store delivers value through three integrated dimensions:

  • Customer experience: The quality of every interaction a shopper has across digital and physical touchpoints—defined by ease, speed, relevance, and personalization.
  • Associate experience: How effectively associates are supported with clear priorities, intuitive tools, and live insight, reducing manual effort and enabling more time for customer engagement.
  • Enterprise efficiency: The retailer’s ability to operate as a coordinated, intelligent enterprise through integrated systems, trusted data, and faster, more automated decision-making. 

What leading retailers are doing

Retailers don’t need to wait for a future-state transformation to begin realizing the benefits of a connected store. In practice, most are already partway along the journey, operating with legacy systems in place but lacking the connective intelligence that turns data into action. What distinguishes retail leaders is not how much technology they deploy, but how effectively they connect what they already have with layered intelligence.

At the foundational stage, retailers focus on eliminating blind spots and establishing operational truth. Stores move from static environments into live, observable systems where inventory, pricing, and activity can be trusted.

Grocery and essential retail formats are often ahead at this stage because their economics demand it. High SKU counts, frequent replenishment, thin margins, and spoilage risk make real-time visibility a necessity, not a nice-to-have.

What leading retailers are doing:

  • Connecting existing assets such as POS, inventory systems, ESLs, RFID, cameras, and workforce tools into a shared data fabric
  • Improving price accuracy, on-shelf availability, and inventory confidence without replacing core platforms
  • Reducing manual audits and reactive firefighting

Once data is connected and trusted, retailers begin layering intelligence. This is where the connected store moves beyond visibility into coordinated execution across the store.

Mass merchants and big-box retailers tend to excel at this stage. Their scale, labor complexity, and traffic variability create strong incentives to orchestrate work dynamically and automate routine decisions.

What we see in the market:

  • Workforce, inventory, tasking, and service signals unified into a single orchestration layer
  • AI-driven prioritization that dynamically directs work to the right associate at the right moment
  • Automated responses to operational exceptions such as OSA risk, queue buildup, shrink exposure, and markdown timing

At higher maturity, the connected store becomes a learning system—continuously sensing, deciding, acting, and improving.

Digitally native retailers and advanced omnichannel leaders are often furthest along here, driven by rapid experimentation, tighter feedback loops, and strong alignment between digital and physical operations.

What retailers are doing:

  • Using closed-loop feedback to refine labor models, assortment, pricing, and execution
  • Operating stores in different “modes” based on mission (conversion-led, fulfillment-led, margin protection)
  • Scaling best-performing behaviors across the fleet automatically

Retailers don’t need to transform everything at once. The journey begins by investing in a few high-impact, foundational capabilities—those that remove friction and generate measurable value on day one. Layering a virtual store manager on top allows these early wins to be orchestrated intelligently, proving the model while building the connective tissue for what comes next. As these capabilities accumulate and learn from one another, they evolve into a fully connected store: A system where data flows freely, automation adapts in real time, and every decision sharpens performance. This is how retailers build the resilience and intelligence the next decade will demand.

Download the report

Did you find this useful?

Thanks for your feedback