Computer. Phone. Bridge. Glasses.
What do all those things have in common?
Thanks to advances in technology, they can all connect to each other. It may sound crazy, and some of them do require specific versions (like Google glasses), but it’s no longer uncommon for devices and machines to interact with each other using the internet.
In fact, the growing “Internet of Things” has been called by some the start of another industrial revolution. Some sources predict that by 2020, there will be over 26 billion products and devices connected to each other.
What is IoT?
Internet of Things.
It doesn’t sound like a very official name, but trust me, it’s a serious and important trend that’s taking the retail world by storm. The Internet of Things (or IoT as I’ll abbreviate it from here on out) refers to the concept of things being connected.
I know it sounds vague, but that’s because it includes such a wide variety of items.
Some of the “things” are pretty obvious: phones, electrical devices like fridges or washers, and computers. But connections have expanded to include things like engines or the cement in bridges. Well, not the cement itself, but sensors embedded in the cement.
Basically it’s the idea that everything with any sort of on/off switch can connect to other machines and the internet.
How IoT Helps
So IoT sounds pretty great, and maybe a little overwhelming, but you might be wondering exactly how it applies to retail. The truth is, of all the companies starting to incorporate IoT, retail is at the top of the list.
Here are six of the top ways IoT can benefit retailers.
1. Products on Demand
A customer walks into a clothing store. She looks around for a while, looking for that perfect interview shirt. A few different options catch her eye, but nothing quite fits what she’s looking for. Suddenly, she sees it. It’s professional, cute, looks comfortable. The color flatters her complexion.
It’s the perfect shirt.
Excitedly, she approaches the rack, flipping through to find one in her size. There isn’t one. She flips through the shirts again. Still no luck.
The customer sighs in resignation and starts her search all over again. But she can never get that perfect shirt out of her mind. Eventually she leaves, disappointed and wondering where else she might be able to find that perfect shirt in the right size.
Stores can use IoT to help customers access a larger inventory. It’s hard to keep a wide variety of options available in retail and IoT can solve the problem of not having an item in stock.
IoT can be used to give customers the option of directly ordering exactly what they want while still in the store. There’s no risk of them looking for the product somewhere else or forgetting to order it online when they get home.
Essentially, IoT can help merge physical retail stores with online shopping. Customers get exactly what they want and leave happy.
And everyone loves a happy customer.
2. Smart Shelves
Two customers are walking through a grocery store. They’re coming from opposite ends of an aisle and both stop about halfway. They both reach for a jar of peanut butter on the shelf.
It’s the last jar.
The two customers stare each other down, neither willing to give up the all-important peanut butter but both wanting to be polite. They laugh a little, then go back to staring at each other. One of the two finally pulls his hand back, saying he’ll track down a sales associate.
After wandering the aisles for a few more minutes, he finally locates an employee. The customer explains that there’s no more peanut butter and the sales associate heads back to see if there’s any in stock. After a few more minutes, the employee comes back with peanut butter.
The customer leaves to complete the rest of his shopping, but has wasted almost ten minutes trying to find peanut butter.
Smart shelves are built to keep track of stock. They send an alert when stock is low employees can fill a shelf before the item runs out. Employees are able to focus on other aspects of their jobs than randomly walking through the aisles to see what’s running low.
3. Order Remotely
Imagine you’re doing laundry. You sort the clothes, fill the washer, and reach for the detergent. The small amount of liquid swishes around the bottle and you realize you have just enough detergent to do this load, but then you’ll have to buy more.
In most cases, you’ll have to remember to add laundry detergent to your list. But if you forget, then the next time you want to wash your clothes you’ll be stuck making an unexpected trip to the store.
Now imagine that instead of trying to remember to put that on a list, you can just press a button either in the room or on your phone. With that simple action, an automatic order is placed for your preferred brand of laundry detergent. It can be sent straight to your home.
IoT allows customers to be directly connected to stores. They can buy products or order items as the need arises, not when they manage to find time to go to the store.
4. Track Trends and Demand
IoT can be used to track trends and take advantage of them. Programs can be created to analyze social media and see what’s popular. Some stores are even tracking factors like weather and preparing for higher demands for certain items.
Stores can also use IoT to analyze a customer’s past purchases to offer them deals or suggest similar items. It’s like those ads you often seen online. The browser will notice items you search for and show ads for them or products like them on the side of the window.
5. Direct Customers
Imagine an app for a retail store. Before you go, you create a shopping list, adding items as you think of them. The app uses GPS to find the closest store and when you get there, it has a route mapped out through the store with stops for each item on your list. The app gets you through the store in the most efficient way possible.
I don’t know about you, but I think that sounds awesome.
While nothing like that exists yet, it’s not that far off. Retail stores have begun developing apps that give customers exclusive coupons, allow them to create shopping lists, and get more information about specific products.
Store have started to incorporate beacons into customers’ shopping experiences, making the stores themselves more interactive.
6. Manage Fleets Efficiently
IoT can also help streamline the shipping process between warehouses and stores. Using GPS and real-time information about traffic, trucks can be sent along the fastest, most efficient route. This can help companies save on fuel costs and receive items more quickly.
Trucks can be filled with similar products to keep the cost of heating or cooling down and sent along routes with fewer delays, which is good for products like frozen food.
Not to mention the ever-helpful real time tracking of shipments.
The Future of IoT
IoT has only just begun to develop. However, what we do know for sure is that it’s based on the idea of building connections.
Connection seems to be the key to success these days: connection to customers, connection to other companies, or connection between employees and employers. IoT might be a new concept, but it has the potential to spark a lot of changes in retail.
So keep your eyes open for how it develops in the future.
What are some other ways you’ve seen IoT used in retail?