/ 5 Ways IoT Promises to Change Retail

When it comes to the Internet of Things (IoT), few industries have as much opportunity for putting connected devices to use as retail does. In fact, 70% of retail decision makers say they’re ready to make changes to adopt IoT solutions within the next five years, according to a survey by Zebra Technologies.

And while IoT still prompts visions of machine take-overs, in reality, most of the applications are more pragmatic—for instance, helping retailers improve their inventory processes, create better customer experiences, or save on energy costs.

Here are five ways that retailers are already putting IoT to use:

1. Eliminating check-out lines.

Many retailers have already experimented with eliminating checkout lines by allowing customers to make purchases via a tablet that sales associates carry around the store. But Amazon took things to a new level (per usual, also learn how Amazon’s AI efforts are leading the pack) when it debuted its first checkout-less grocery store earlier this year in Seattle. Of course, more are on the way. Basically, you check in the store via an app on your phone, choose the items you need, and leave. It sounds simple enough, but a whole host of advanced technology, from sensors to machine learning to AI to mobile money, is what makes this possible. Welcome to the future.

2. Improving inventory tracking.

Having enough product at the right time and at the right location is a challenge that continues to vex many big retailers. However, IoT promises to take old radio frequency identification (RFID) technology and put it use improving retailers’ inventory tracking and product fulfillment. Macy’s, for instance, plans to use RFID tags and handheld RFID readers to track all the products in its stores by the end of 2017, according to the RFID Journal. The company has been using RFID tags for the past few years to monitor its supply chain and the inventory of select product types, as well as to speed up its replenishment. For Macy’s and other companies, the ability to combine product-location information with additional store data looks to be a valuable opportunity. Retailers are also exploring in-store sensors on shelves as another way to monitor inventory.

3. Creating smart stores.

You’ve probably heard of smart homes, but now retailers are exploring the money-saving potential of smart stores. Many retailers are already taking advantage of IoT technology that integrates with HVAC systems, lighting, security, and more. The ability to fine-tune when a store’s lights go on and off, or to set the temperature inside a space, may seem like small potatoes—but this technology can ultimately save retailers big money on energy costs. “It pays for itself out of the gate. It’s an easy investment for the retailer and it represents the start of building an in-store sensor platform for us to do much smarter things,” explains Dan Mitchell, director of the retail and consumer packaged goods global practice for SAS, in the National Retail Foundation’s magazine.

4. Customizing store visits.

According to the Zebra research, 79% of retailers will be able to customize a store experience for their customers—because they’ll know exactly when customers visit. Micro-location technology and the ubiquity of mobile phones makes this possible. What’s the benefit? Well, if your sales associate knows that a customer was recently browsing online for a new pair of jeans, then when that particular customer walks through the door, the associate could be ready with specific denim suggestions. IoT technology helps close the gap between online and physical shopping experiences and potentially improves retailers’ performance in both.

5. Collecting better retail data.

Of course, the promise of the IoT isn’t just the ability to control in-store lighting from afar or provide customers with five versions of what they were searching for online the night before. More broadly, IoT solutions offer retailers the chance to collect data about their operations like never before. For instance, by using sensors in stores, retailers not only know when a given product is low in stock—they can also track exactly how many customers enter a store on a given day, and even the footpath that each individual customer follows.

The opportunities for gathering data are endless, but the retailers who want to make the most out of IoT tech will need to determine which data is most important, and then take action on their findings.

For more insights—and help to determine which technology to invest in, and which to bypass—download our report Fighting E-Commerce Fomo.