March 14, 2019
The Internet of Things (IoT) is basically a network of physical objects that are embedded with sensors. These objects are connected to each other, to online networks and cloud-based platforms. They have the ability to communicate, analyse and share information about the physical world.
The integration of IoT in retail has enabled many innovations and is quickly changing how things are done in the retail industry. From helping companies to create highly successful marketing strategies to delivering better quality customer service, IoT has yielded many benefits already.
By the look of things, the use of IoT is expected to increase in the coming years. Investors are also paying keen interest on IoT companies due to their bright future prospects. If you are in stocks and CFD trading, you might want to research on top IoT stocks to trade in 2019 as they could be great additions to your portfolio.
The following stats give a glimpse of how IoT advancement mean for the retail industry.
- Global Market Insights predicts the value of IoT application in retail market to be over USD 30 billion by 2024.
- IoT in the retail industry will have an economic impact estimated at between USD 410 billion and USD 1.2 trillion per year by 2025, according to McKinsey.
- According to Markets and Markets, the Digital Signage Market will grow by about 42 per cent from 2019 to 2024 to reach USD 29.6 billion.
- The number of beacons installed in 2015 was 96,000. BI Intelligence had predicted the number to increase to 3.5 million in 2018.
Ways in which IoT is transforming retail in 2019
i. The smart warehouse
Keeping track of inventory is a critical aspect of business efficiency. IoT is being applied in the operation of store management systems that help to not only keep good track of inventory but also make it easy for workers to find stored items.
Sensors and RFID technology are popular applications of IoT warehouse managers are using to maximize space, speed up operations, and reduce energy costs. IoT-enabled dashboards are used to provide warehouse management with real-time updates to aid the efficient flow of store operations.
ii. The smart shop
In the years before IoT, retail shops used expensive surveys to measure different aspects of retail efficiency along the shopping journey. How well are store associates responsive to emerging customer service needs? What should be included in staff training programs for better client service?
Through developments like Wi-Fi or video foot-traffic monitoring, IoT has made it easier and less expensive to understand customer behavior inside shopping facilities. It has also enabled more effective customer support as associates can be directed in real-time to help a customer who seems stuck along the shopping journey.
In addition, analyzing information on customer movements gives insights on how to adjust store layout to customize in-store shopper experience.
iii. Better customer assistance using robot employees
Robots are increasingly being used to do menial jobs that burden workforce in the retail industry. Today, we have robot employees that help customers to find specific products as well provide information on inventory and promotions. In some retail stores robot employees roam around and find misplaced items or notice products that are running out of stock. When robots take over such simple tasks, human employees can focus more on offering customized assistance to customers, which results to better and better customer experience.
iv. Smarter merchandise transportation
Efficient movement of merchandise is the other critical measure of business success in retail. IoT applications in transportation involve tracking, route optimization, and maintenance of transport. While GPS has been in use for many years in transport management, IoT has enabled us to estimate more accurately the movement of merchandise. This has helped retailers to plan and manage clients in a better way.
v. More cost-effective marketing with digital signage
Combining digital signage with IoT allows retailers to adopt more cost-effective advertising and marketing strategies. Instead of using conventional methods such as print and electronic media, you use electronic sign displays including LCD and LED projections, e-paper, videos, and web pages. These newer advertising methods save on costs, giving the retailer a chance to achieve higher profitability.
IoT continues to revolutionize the retail industry. Most of the innovations are particularly targeted at improving operational efficiency in the supply chain. For retailers, IoT has broken the ground for effective use of business analytics. Customers are also gaining big from IoT applications in retail as these applications are driving customer experience a notch higher every day. It will be exciting to measure the transformation IoT will have caused in the retail market by the end of 2019.