The retail industry is growing slowly and moving from selling products to selling experiences with the adoption of new technologies. It has become extremely important for every retailer to know what their customers are looking for in order to enhance their shopping experience.
However, it has been a tough task to know what the customers are facing and as a result, the retail industry is one that faces the greatest risk of losing their loyal customers.
According to the survey, almost 80% of customers don’t even give retailers a chance to fix their issue before choosing their competitors.
But due to the advent of new technologies, the retail industry is implementing the latest tools and technologies to retail their existing customers. The Internet of Things (IoT) is one of them.
Internet of Things is one of the major game-changing technologies that has completely reshaped the retail industry and is transforming the lives of customers as well as retailers. IoT can help retailers in identifying customers’ problems and also in fixing them efficiently. IoT also helps retailers to enhance supply chain management, improve the checkout process, track assets, etc.
A leading consulting agency, McKinsey stated that the economic impact of IoT for retail will reach $410 million to $1.2 trillion every year by 2025.
From 2019, various leading retail brands have shifted to IoT. Also, as per the report, the market value of IoT for retail will reach $94.44 billion by 2025.
- 77% of retailers believe that IoT solutions can help improve customer experience
- 89% of early-adopters in retail say that IoT enables them to gain increased insights into customer preferences
- 77% of retailers believe that IoT technology helps them to cooperate with partners in delivering quality products and services to their customers.
So, if you are also planning to integrate IoT in your retail business after reading this article, you can reach out to the best IoT development company or hire IoT developer.
Opportunities for Retailers
Retailers that have implemented IoT technology have already leveraged benefits like reduced costs, improved performance, and enhanced customer experience.
While there are numerous IoT-related benefits to the retail industry, but here, we’ll hone in on some of the most important ways we think IoT will change retail in the coming years.
Smart Shelves for Inventory & Supply Chain Management
There are many organizations including startups and large-level enterprises are utilizing IoT to take their operations to the next level and simplify inventory management. The IoT retail has helped traditional stores modernize and upgrade their operations, even streamlining inventory management.
But innovation like smart shelves in the retail sector takes automated inventory management one step further. Smart shelves help you automate the task and inventory management.
Moreover, store managers can get real-time notifications and updates on sales and stock levels. Also, they get alerts when an SKU (Stock Keeping Unit) falls below the reorder level. Apart from that, it helps you eliminate manual errors by preventing both overstocking and shortage of products. This way, you can save money as well.
Smart shelf systems are attached to weight sensors and utilize the Radio-Frequency Identification (RFID) technology. They consist of:
- An RFID tag to attach to merchandise,
- An RFID reader,
- An antenna.
The RFID tags transmit information to the reader with the help of radio waves. Then the data is transferred to an IoT platform for storage and analysis.
Just like barcodes, RFID tags read the signal from the tag and store data in the digital form from a tag or a label. There are many significant advantages to RFID systems. But importantly, unlike traditional barcodes, RFID tag data can be read outside the line of sight.
What will you do, if you find huge waiting lines at the checkout? I am sure, you would probably not prefer to purchase any products. Right?
Many managers would have to employ cashiers and set up multiple cash counters in retail stores, which may cost you a huge amount.
But do we have another option now?
Well, to prevent this, you can install and use a machine that does the work of a checkout cashier. If you place apps and device cameras at the cash counters, checkout lanes may be a thing of the past. This IoT-enabled system will verify all the products your customer purchased and deduct the total as soon as the customer leaves the store.
An IoT-enabled system will grab the attention of many users to the store, particularly when they are in a hurry to purchase. Moreover, we also feel that Mobile POS (point-of-sale) will become more common.
As per McKinsey, an automated checkout can help to decrease the cashier team by about 75%, thus leading to savings of $150 billion to $380 billion a year in 2025.
AI systems such as Shoplift employ computer vision systems to identify thefts of suspicious objects or behavior. You can install these in your stores to improve stock visibility. Systems can detect not-for-sale items such as reusable shopping bags or unscanned merchandise if customers
attempt to carry them past a checkpoint. The systems also send alerts to store staff so they can do the needful.
Many retailers often have to face the recurring expense of their assets such as baskets and shopping carts being lost or misplaced.
Shopping carts are expensive and they cost between $75 to $250, which will increase the expense. To prevent this expense, you can use IoT technology to track your assets like shopping carts to their exact location if they get misplaced or lost. There can be status updates and alerts if they get damaged. This will reduce the overall costs.
You can install tracking devices on each basket and shopping cart. You can operate them effectively for several months and years without changing their batteries. These tracking devices can function both indoors and outdoors.
IoT sensors can also help retailers to know that there are enough empty shopping carts and baskets available for the shoppers.
Beacons for Timed and Targeted Notifications
You might have experienced the Beacon, but not known it. Wondering, how?
Let me tell you.
Beacons are small Bluetooth devices that send discount vouchers or event invites to smartphones within a geographic coverage area. So organizations or event planners can attach those Beacon devices to the counters, walls, or anywhere suitable within the vicinity of the store.
Getting such alerts can cause potential customers to go into a store and take advantage of the offer. Stores can also beam out on-the-spot contests or promotions or lucky numbers to customers already in the store.
In-store Layout Optimization
There are many stores that are not preferred by customers because their retail space is not optimized as per their target audience. Store or product arrangements play an important role when customers step into your store.
There are chances that not so famous products are placed at the entrance or customers love to have more space between some products. With the utilization of aisle-analytics software with infrared sensors, you can use IoT technology to improve your retail layout.
For instance, most of the customers love to check the TVs; however, you have placed them at the end of the store, behind rarely-touched DVD players. This way, you can get to know about customer behavior; hence, you can place items like TV in front of your store.
Robots in the retail industry may sound like a futuristic approach, but they do exist today. Albeit, you find it difficult to place your belief in a robot for customer service, you have the freedom to remove all the inferior tasks that are carried out at your store.
In nutshell, you can automate a large number of tasks at your store using robots, which was a myth before.
The American company Lowe introduced the robot named OSHbot, which helps customers find what they need and look for particular products and offers details on promotions and inventory. Moreover, the robot can help you solve your queries in two languages: English and Spanish.
In this blog, we have covered the majority of benefits that the retail industry can leverage with the implementation of IoT. With each passing year, IoT is growing and becoming a new standard, and many retailers are transforming their business through it.
However, by hiring a mobile app development company – The One Technologies, you can develop a retail app for your business. Also, you can hire IoT developer from us. They will understand the requirements of your retail store and provide you with effective solutions.
Author’s Bio: Kiran Beladiya is the co-founder of the website design company the name is The One Technologies. He is managing everything from discussing project ideas with clients to its release. Due to the hectic schedule, he could not get enough time to nurture and sharpen his writing skills but he is an avid writer. You can connect with him on Twitter and LinkedIn.