The IoT (also known as Internet of Things) is revolutionizing every aspect of life and will be a game changer in the next couple of years. Its impact is already beginning in the retail sector and many businesses are implementing IoT with great success.
The first wave of IoT implementation came in the field of supporting intelligent business operations and back-office business works. Now, more and more businesses are using the beacon and the Wi-Fi tracking systems to collect valuable data in stores. IoT-enabled businesses to feed valuable real-time analytics even on the basic daily operations.
As for the brick-and-mortar retail all that matters is serving customers in a given physical space. These two elements - customer experience and space — will soon be transformed in the future by IoT.
Redefining Physical Space
Offline stores are at a disadvantage when we compare them with online stores. As an owner of online business you are able to easily capture information about your potential customers - products they are interested in, items they put in their shopping carts, and what items they actually purchase. On the other hand, offline retail store owners have only point-of-sale info to work with.
Now, Internet of Things technologies like GSM or Wi-Fi have enabled tracking users which enables retailers to collect data where their customers walk, where they stop and what they placed into their shopping carts. Such information is used to optimize the online store layout and to increase traffic to certain departments. Some retailers like Nordstrom have used this tactic and abandoned it, but others like Cabela’s and Family Dollar the information to be a useful strategy.
Another development allowing retailers to redefine their space is RFID technology - a barcode which uses radio waves to scan goods/items and keep track of inventory in real time. Stores like Zara are employing RFID to replenish their stock before the store shelves go empty. Increasing responsiveness of the store’s inventory makes it easier to have increased sales within a limited space.
Redefining the Customer Experience
By deploying predictive tech to build smart shelves and warehouses, it is possible to nearly do away entirely with the bane of customer experience — arriving at the store to purchase an item that is not available.
In the near future, stores will be able to do more than sell what you require. They will be what you have always wanted. They will literally transform as you make your presence felt via virtual reality, lights, or a TV screen. Now let’s say Macy’s knew the perfumes you love; what if that particular scent followed you through the store? As soon as you enter the store, the responsive sales floor would identify the scent and present you the item.
Here are a few simple steps serious retailers can do to prepare themselves for possibilities offered by IoT:
- Update your IT system to support an influx of data. Remember data powers IoT, and to avoid any data overflow, you must identify the crucial data to gather for your business.
- Start building a multi-channel strategy which will be able to embrace newer avenues, such as user interactivity in the store. All channels must have a coherent communication system. Do not start a new channel just because you can afford to do it. Remember that not every system is fit for all businesses.
- Get ready to act quickly. You will be required to make quick decisions right on the spot and for this you need business rules that will automate your work as much as you can.
The Internet of Things is set to transform retail business, but for the better. It can save significant physical space and further optimize your customers’ experience. With proper planning, this model can usher in an entirely new opportunity for your business and further expansion.