As devices continue to advance and become more connected, the world of retail may never be the same. From virtual reality systems that transform customer engagement to cloud-based devices that drive personalized shopping experiences, the Internet of Things (IoT) is without question the most important trend in retail.
There has been a lot of conversation about IoT’s role as a game-changer for the retail industry, but it’s important to grasp the basic concepts before plunging in. In the IoT world, analytics and connected devices provide retailers with a plethora of benefits, including deeper insights into what customers are buying. This knowledge helps retailers equip their brick-and-mortar stores with the right products and run the right promotions, allowing them to leverage customer sentiment and, ultimately, change the way they do business to drive increased profits.
As IoT enables the interconnection of networks, linking the physical and digital worlds in an ecosystem of computers, smartphones, in-store devices, vehicles, and wearables, retailers’ transformation is inevitable. Here are three ways IoT will impact the way retailers do business while changing the consumer experience for the better.
Increased automatic shopping. One of the major shifts in the retail landscape is the move into automatic shopping. Appliance manufacturers are already releasing “smart” machines like printers that automatically place orders for ink when levels run low. With the expansion of internet-connected devices, consumers will have access to products like “smart” fridges that notify consumers when perishable products expire. As more devices become connected to the Internet, the retail industry will see a dramatic increase in automated consumer purchases.
Better data in real time. The proliferation of IoT means consumers are using more connected devices on a daily basis. From smart appliances to connected cars and fitness devices that transmit data, retailers have access to a stream of real-time information that can translate into a greater understanding of consumer behavior. To take advantage of this aspect of IoT, retailers will need to invest in advanced systems for collecting, sorting, storing, and analyzing sensitive, consumer-generated data.
Competitive chaos. Shopping decisions will become increasingly automated as consumers rely on smart devices to make instant purchases. As a result, the competition for new customers will surge to the next level. Once a customer can simply buy a product from anywhere with Internet access without giving it much thought, the likelihood of luring them away from a competitor becomes significantly lower. This delivers an enormous advantage to companies like Amazon, which sells a huge number of competitively priced products and already has an impressive user base for its Dash and Alexa IoT-centric shopping devices.
Retail success is as much about offering the right products to your customers as it is keeping up with the scope and variety of technologies that can be enabled in connected ecosystems. Keeping in mind that anything that can be connected eventually will be connected, retailers can adopt IoT strategies that complement their long-term goals.
As IoT enables the interconnection of networks, linking the physical and digital worlds in an ecosystem of computers, smartphones, in-store devices, vehicles, and wearables, retailers’ transformation is inevitable.