New IoT devices are being added to retail stores and warehouses everyday—with powerful effect. McKinsey estimates that the potential economic impact of the Internet of Things on retail environments will range from $410 billion to $1.2 trillion per year by 2025
What’s in store for the IoT industry in 2020 and beyond:
- 5G will revolutionize IoT devices for retail—Consumers will have access to more data with virtually no response delay—and make better and more informed decisions about where and what they want to shop for. 5G will also transform packaging and delivery, with smart sensors collecting real-time data to ensure optimal internal packaging conditions for food and beverage products and pharmaceuticals. In the 5G-powered dressing rooms of tomorrow, interactive “magic mirrors” will recognize the products a shopper tries on through an RFID tag—providing retailers with valuable feedback about customer preferences.
- The use of robotic assistants will continue to grow—Some mainstream retailers are already using them successfully. At the Lowe’s hardware chain, for example, OSHbot helps shoppers find specific products and provides information in English and Spanish on special promotions and product availability. At Target, robotic devices record misplaced items and stock levels on the store shelves, freeing up employees to focus on customer service.
- Automatic checkout and cashier-less payment systems will improve store traffic flow and free up staff—IoT-enabled systems can read tags on every item purchased before a customer leaves the store. The total cost is then tallied up and automatically deducted from the customer’s mobile payment app. McKinsey estimates automated checkout can reduce cashier staff requirements by as much as 75%, resulting in savings of $150 billion to $380 billion a year in 2025.
- Beacon usage will increase in stores, facilitating and personalizing the retail shopping experience—First introduced by Apple in 2013, these small Bluetooth devices send alerts to smartphones based on location proximity—informing customers who have previously downloaded the store’s app about discounts, special events and other offers when they’re in or near a store. The app also recognizes which area of the store the shopper is in and customizes the messages accordingly. Major retailers like CVS, Macy’s and Urban Outfitters have been using beacons for several years now with considerable success. In a study conducted by Swirl Networks, 70% of shoppers said beacon-triggered content and offers increased their likelihood to purchase in-store.
- Personalized discounts will reward shopper loyalty—IoT allows retailers to set up in-store sensors that send loyalty discounts to certain customers (for their preferred products and brands) when they stand near products with their smartphones.
- Smart shelves will streamline and improve the precision of the inventory process—Fitted with weight sensors, smart shelves use RFID tags and readers to scan products on display and stock shelves, informing store employees when items are running low or incorrectly shelved. Since each RFID tag is connected to a reader, smart shelves can also detect in-store theft and reduce the need for security personnel and surveillance cameras.
- Aisle-analytics software with infrared sensors will help retailers optimize store layouts—The sensors can observe traffic patterns and where customers spend the most time to determine where to place the most popular and profitable items.
The potential for IoT devices in retail is enormous, and you should encourage your retail customers to give innovations like these a closer look in 2020. To see the IoT solutions Ingram Micro has to offer, visit our IoT marketplace
. And if you have a specific solution in mind, or want to talk over specific scenarios and recommendations, reach out to the IoT experts at Ingram Micro