The Internet of Things (IoT) is transforming the retail industry, giving retailers the opportunity to develop an ecosystem that links the physical world with the digital one. From connected customers to smart stores, retailers, big and small, are changing the way products are reaching out to the market – and IoT is one immensely powerful tool in this direction.
A report by Grand View Research has unveiled that the market size for global IoT in the retail industry is expected to develop at a CAGR of 21.5% over the forecast period 2018-2025. In a Global Market Insights report, IoT in the retail industry is predicted to reach over $30 billion by 2024.
Let’s take a look at some of the most popular IoT applications in the retail space, and how they are making waves in the market, while making shopping more exciting for customers.
Trending IoT applications in Retail
One of the most important applications of IoT in the retail industry is the optimization of supply chain management. Without IoT, tracking products in transit was fairly limited. However, with GPS sensors and RFID, data has become more precise, which has improved the quality of transportation by reducing transit time, maintaining the longevity of perishable goods and cutting back on costs and wastage. An optimized supply chain has ensured that processes are running efficiently and that the products reach customers faster.
Mapping shoppers’ foot-traffic is a key IoT application that has helped retailers transform their store’s layout and the way they handle customers. In-store sensors track number of shoppers walking in and out of the stores during specific hours, weeks and months, besides figuring out where shoppers stop and spend the most time, whether low traffic areas of the store have been given more space than required, where the items on sale should be placed, etc. Retailers have been able to effectively improve in-store experience of their customers using these IoT sensors.
‘What’s not to like in automated checkouts!’, as retailers may have observed when they replaced human cashiers with their bot equivalents. No long, slow lines at checkout and no grouchy cashiers – automated checkouts have upped customer experience in stores many times over.
These small Bluetooth devices, located mostly inside a store, reach out to customers nearby on their mobile phones and alert them on in-store discounts, sales, special events and other similar messages. It’s a great way to send push messages to customers, increasing walk-ins, and even guiding customers within the store by offering them more info on the aisle they are at, or the promotions available on the products they are looking at or have checked out before.
This sensor-connected IoT device alerts stores when stocks are running low or are missing or even misplaced; alerting suppliers to fulfill stocks as required. The RFID also ensures detection of in-store theft. In all, smart shelves make the process of inventory seamless and cost-effective.
Digital in-store signage are a great way to display advertisements, make announcement on promotions and discounts, and encourage interaction with customers via their touch screens.
Predictive Equipment Maintenance
Stores that have high tech equipment will need predictive maintenance to ensure energy savings and product safety. To make sure that there is no equipment failure, these devices are connected to the IoT platform that anticipates the equipment’s need for maintenance or repair.
Real-life Retail IoT Scenarios
According to a Forbes Insights analysis, 51% of surveyed retail executives reported that robust IoT efforts are underway in their stores, either in departments, or in some cases across the enterprises. Here are some notable real-life examples of IoT applications in retail across the world:
Case 1: Starbucks launched the iBeacon technology as a way to introduce its customers to its range of premium brews at its Roastery and Tasting Rooms. Starbucks has also been in the forefront of mobile payments, a great way to let customers get their cup of brew quickly, without waiting in long queues.
Case 2: Amazon’s brick and mortar retail store chain, Amazon Go, will have no cash counters and cashiers, and will use sensors and online wallets to provide its customers the same seamless shopping experience that they are used to online.
Case 3: Rebecca Minkoff, a global fashion brand, set up their in-store dressing rooms with smart mirrors that recognize the items brought to the trial rooms by their RFID and show how the items can be styled differently, even “try” other sizes or check out the items under diverse lighting to get a complete experience of the product.
Read more : Impact of IoT in Retail Supply Chain Management
By combining two or more of these smart IoT applications in their day to day processes, retailers are making big-time gains for their business, and dramatically transforming and innovating the retail industry. And to think that this is just the beginning, and the future of retail is marked for disruption like never before!
Want to explore how IoT can boost your retail business? Mail us at firstname.lastname@example.org to get information on the POCs and case studies we have created for our retail clients.