5 Ways the Internet of Things Is Transforming the Retail Industry

Grocery shopping at the local supermarket can mean long lines at the checkout counter with customers scrambling to pay with cash or through a POS machine for credit card swipes, making the queues longer. But with the continuous rise of e-commerce, consumers don’t even have to actually go to a physical store to buy what they need, as technology has totally changed the way we shop retail.

Retail giant, Amazon, has made a huge leap in the retail industry after the company launched the first Amazon Go store in Seattle. It gives consumers a unique brick-and-mortar shopping experience by applying technology in a futuristic way. You can shop by having your Amazon Go app scanned as you go through the turnstiles before choosing what to pick up and leaving the store without having to pay for the items.

This new shopping experience combines technology and physical reality, allowing customers to complete their errand without the help of any human interaction. It uses hundreds of cameras and electronic sensors strategically installed throughout the store to identify each customer and keep track of all the items they take from the shelves. They are billed on their credit cards as they leave the store through the gates.

The technology used in this revolutionary endeavor is the Internet of Things (IoT), which creates an omnichannel shopping experience that many believe will be the future of retail. It utilizes a network of devices equipped with sensors, software, and other electronics that enable them to connect, exchange data, and function as an intelligent system. This technology has indeed opened doors to numerous applications, but its applications on retail are guaranteed to change the industry as we know it.

It combines the physical and digital aspects to enhance customer experience

Many consumers still prefer going to a physical store to shop, but some prefer the convenience of getting things done online. IoT brings together the best of both worlds and helps retailers connect with shoppers by knowing how to personalize their experiences through the data gathered from their shopping behavior.

Retailers can send personalized coupons and other offers to their customers through the app in an effort to entice them to shop. This also lets them know that their regularly purchased items are on a special discount for a limited time.

It improves convenience and security

Biometric authentication can be applied to contactless payment to add another layer of security and protection from identity theft and consumer fraud. This technology is heavily used in online banking, but is now being utilized for making online payments. It has also been applied to identify known shoplifters to avoid store losses.

Most importantly, you just need to have your smartphone so that you can walk in and out of the stores without waiting in line to check out your items.

It helps save on operational costs

While putting up a retail store with IoT technology including its maintenance and utility fees can be expensive, its long-term benefits may outweigh the initial costs.

The sensors installed on ‘smart’ shelves can help detect low inventory levels to track the products that need to be replenished and avoid running out of stock so that stores won’t miss out on revenue.

An automated system can help retailers throughout the supply chain process by analyzing the trends from all the in-store data gathered. This makes it easier to know which particular products to stock at specific time frames to make sure the customer demands are met.

Stores are smarter

Since the technology opens a whole new world of possibilities, retailers are also exploring the cost-efficient integration of HVAC systems, lighting, and other utilities.

The system can learn the schedule of the store and lower consumption during off-peak hours. This may seem insignificant, but it can save retailers huge money on energy costs.

Beacons, cameras, and sensors combined with app data can identify customer traffic and know when they are most likely to flock to the store at any given time. The data can also be used to improve operational flow and determine the right time and location for product promotions.

Robots help streamline the process

Since the technology aims to lessen human involvement, robots can help streamline the whole retail process starting from the supply chain while emphasizing safety.

Chatbots backed by AI software can also assist by analyzing shoppers’ questions and helping them plan a more rewarding shopping experience.

At its very essence, the technology involved in the Internet of Things makes smart use of omnichannel retailing to make shopping a uniquely immersive experience. With the launch of Amazon Go, other retailers are surely looking into the technology to improve their business further and draw in customers who are looking to shop at a store that knows and understands the future of retail. The results will reward the brands and properties that invest in technology and will likely change the way we shop for almost every consumer good.

Propmodo is a global multimedia effort to explore how emerging technologies affect our built environment.

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