The Internet of Things promises significant benefits for both retailers and customers. We look at the early advantages of this technology – and the chances for further growth.
The Internet of Things is already having a significant impact on the retail industry, and on everything from improving the in-store shopping experience for customers to making retailers more profitable, efficient and unique.
With that in mind, we look at how this connection of everyday objects to the Internet, and the subsequent collection of data, is changing how retailers do business, and how consumers shop in-store and online.
An interactive shopping experience
IoT offers retailers the chance to be much more interactive in what products and services they offer to their customers.
For example, through the use of mobile apps, RFID tags, virtual reality (VR), Apple iBeacons and customers’ smartphones, stores can let customers get more information on a product, offer suggested items based on previous purchases, or even let them ‘virtually’ try an item on. They can also invite customers to redeem vouchers on goods they like, offer promotions in real-time or just give directions to their favourite items.
This digital experience is engaging the customer much better than ever before – and increasing the likelihood of them walking away satisfied, and with a new purchase.
Save money through inventory management
One of the age-old problems in retail is having a true picture of inventory on the store shelf but IoT is helping store managers and senior executives by giving a much clearer view through the use of cameras, sensors and RFID tags.
Retailers can subsequently tell what items have come into the store, which have been sold, and even where these items should be placed in-store.
By doing this, retailers can properly understand their inventory and in-store item positioning and save money by stocking only the goods they need. They will also save on staff time, which was previously wasted on checking inventory management manually.
Reduce fraud and shrinkage
Through the use of NFC tags, retailers have become much better at tracking items from the warehouse to the store, and even out to the customer. This is great news for reducing customer fraud, and ‘shrinkage’ – where items are not accounted for.
Having this visibility is essential not only for stock room control but also seeing what is ‘hot’ during the month, and restocking as quickly as possible. The tracing can start from the point of manufacturing and also enables retailers to check the condition of goods on-the-move.
Measure store visitors
IoT doesn’t just offer benefits for tracking goods internally though; it can also be used for retailers to check who exactly comes to their stores – and who passes by.
For example, using Wi-Fi, in-store cameras and big data analytics, retail stores can capture the unique identifier from a customer’s phone and identify how many customers came into the store, how long they were there, and gauge if they purchased or browsed from their time in store. They can also judge how many people passed the store without entering, which part of their store customers visited most and how many customers came in multiple times.
Through this analysis, retailers can fit their store to attract more visitors – and more sales.
Boost sales through store positioning
Through the use of RFID, and data analytics, retailers are able to see what items sell in-store in accordance with store plans, and adjust them accordingly. This is helping their branding, and making the store more attractive to visitors.