The Future of Retail: Adapting to the Evolving Threat of Organized Retail Crime

’Tis the season for selecting the perfect gift, but checking off—and checking out—items on shoppers’ lists looks quite different now. The in-store shopping experience, once a sensory experience, is decidedly more transactional as retailers look to outwit organized criminal syndicates with extra security and surveillance measures.

Take Sephora and Ulta Beauty. These two beauty retailers placed products in customers’ hands, encouraged them to try before they buy, and removed the friction shoppers experienced at department store counters. This experiential retail approach transformed the beauty industry, redefined the self-service, and pioneered the grab-and-go convenience of paying for these products.

But company leaders said the staggering increase in organized retail crime forced them to rethink their retail beauty regimen—at least for fragrances—and change their signature scent. Both are locking up perfumes, leaving only testers on shelves, and investing in in-store security personnel as the best practices to combat organized retail crime. These measures reverse their winning business strategies that drove sales and built legions of loyal shoppers.

Dave Kimbell, CEO of Ulta Beauty, focused on product theft and inventory shrink during the company’s first-quarter earnings call in May 2023. “The rise in violence and aggressive behavior during organized retail crime thefts is concerning. The company has experienced higher levels of theft and is challenged to address the issues collaboratively. Retailers in other sectors have similarly raised concerns about increased organized retail crime (ORC)—professional, large-scale theft conducted as a business with goods resold on the black market for financial gain."

Sophisticated Criminals Compile Long Shopping Lists

High-end fragrances are not the only highly targeted items for organized retail criminals. Their methods and illicit shopping lists include many products, from power tools to laundry detergent, all with pressing market demand and quick resale value.

No longer are items stolen only for personal use; enterprising organized retail crime networks target goods that deliver substantial returns. These products are listed on social media platforms with typical keywords, such as “available in bulk” and “new with tags,” indicating that a new product is being resold, or are displayed in plain sight at flea markets.

ORC Networks Share Retailers’ Information

ORC is a complex problem to solve as there are many components to these crimes, especially as criminal syndicates share information, including:

• ‍Readily Available High-Demand Items: Despite the news reports focusing on smash-and-grab burglaries at high-end stores, only a small percentage of ORC groups target luxury items. It’s more common for thieves to target health and beauty items, infant products, electronics, laundry products, and office supplies.
• ‍News Thieves Use: Those who engage in ORC share tips about retailer security procedures and prosecution procedures, detailed store layouts, and different jurisdictions’ legal approaches to felony theft.
• ‍Seller recommendations: Stolen goods are sold in person and on the internet, from legitimate retailers buying from questionable suppliers to peer-to-peer online outlets.

Retailers Need to Find Innovative Solutions for Shoppers

ORC leaves retailers across all SKUs with a vexing problem: How can we combat crime and keep our customers happy?

Retailers, including Target, Dollar Tree, and PetSmart, are following Sephora and Ulta Beauty’s lead and placing more products under lock and key. However, some retailers are experimenting with less intrusive solutions, like intuitive business security cameras and Bluetooth RFID chips. By implementing these options, retailers are trying to override the current methods that require a shopper to summon an employee or bring a locked product to the checkout:

• Walmart is testing anti-theft devices that employees can activate with their smartphones.
• A major department store is using small Bluetooth chips on items as point-of-sale security.
• Some retailers are testing sending codes to shoppers’ mobile phones to give them access to unlock cases.‍
• Home Depot and Lowe’s are deploying technologies that unlock a power tool after its purchase at a cash register. The former also uses shopping carts that stop at the exit if they haven’t been scanned going through a checkout lane.

Retailers Take More Aggressive Actions to Combat ORC

While these security measures can help make shopping a more enjoyable experience for customers, they add up. Some retailers find it too pricey and don’t see a viable way to make a return on this level of investment.

The impact of theft and associated violence has required retailers to take more aggressive steps. According to the NRF National Retail Security Survey, retailers reported specific measures to counter the issue, including:

• 45% reduced store operating hours
• 30% reduced, or completely removed, specific merchandise
• 28% closed store locations, including Target, REI, Nike, and Nordstrom

“We cannot continue operating these stores because theft and organized retail crime are threatening the safety of our team and guests, and contributing to unsustainable business performance,” Target said in a statement. “We know that our stores serve an important role in their communities, but we can only be successful if the working and shopping environment is safe for all.” 

Other retail leaders are sounding the alarm as well.

“Ultimately, shrink will either be resolved through defensive merchandising, store closures, and/or through government action at the local level,” Rick Dreiling, chief executive of Dollar Tree, told analysts.

Increased Security Measures Worth the Investment

Many asset protection leaders believe increasing security with innovative technologies, combined with traditional human intelligence and policing, is critical to strategically solving this pervasive issue.

Monitoring and securing store parking lots with LVT Units provides a strong line of defense for retailers—and is worth the investment. The mobile surveillance unit features cutting-edge technology designed for retail theft prevention and offers a wide range of surveillance options. From live security cameras and intuitive sensors to a cloud-based app and customized alerts, LVT ensures total peace of mind—24 hours a day.

Unlike traditional security methods, LVT’s solution focuses on deterrence. Some of the world’s biggest retailers, including drug stores, grocery chains, home improvement centers, and electronics stores, trust LVT Units to increase parking lot security and safety.

Our clients experience results right away:

• One retailer reduced high-risk crimes by 62% and decreased grab-and-go thefts by 69%
• A leading pharmacy chain faced armed robberies up to three times a week and eliminated them after deploying LVT Units across 12 locations.
• A major home goods store added LVT Units to its overall security plan and hasn’t had a theft since.

When security professionals choose LiveView Technologies, they deploy the most advanced security system on the market and reduce crime immediately. Our retail customers know LVT provides the best security strategy that addresses and combat ORC challenges. Contact our team today for a demo.