Saturday, October 31, 2015

How the “Internet of Things” Will Reinvent Retail

By Natalie Bruins

Technology doesn’t wait for retailers to catch up. Consumers embrace new technology and aren’t impressed by retailers who don’t. This year, smart retailers are creating ‘smarter’ stores with the Internet of Things (IoT) reinventing the way they think about retail.

With IoT, a huge number of devices can be connected – with everything from Point of Sale systems to dressing rooms doors, able to connect. Microsoft have already tried to add a human touch to this phrase – describing it as ‘the internet of your things’ – and it’s this personalised approach which sums up how IoT should be for consumers.

Plus, for retailers, it’s about how your ‘things’, or in other words, technology, can connect to provide a better experience for your customers.

One example of how IoT is already providing a better experience for customers and better data for a brand is Disney. The park has RFID-enabled MagicBand wristbands that provide theme park access, entry to hotel rooms, and cash and card-free payment for food and any merchandise. Disney is able to track this activity to build an accurate picture of how each guest uses their services.

From Disneyland to high-tech highstreets, here’s how this new technology will reinvent retail.
  1. RFID (Radio-frequency identification) tagging
RFID is probably the most well-known example of IoT and according to Bill Hardgrave of Auburn University, the technology can have huge benefits for retailers. RFID involves tracking and counting products automatically and can give retailers 99% inventory accuracy, a 50% reduction in out-of-stocks, a 70% reduction in shrinkage, and sales lifts from 2% to 7%.
  1. Connecting home automation to ecommerce sites
There are certain products, which we all need to buy – from fridge essentials such as butter and milk to bathroom basics such as toilet roll and shower gel. IoT could allow consumers to press a button in their home to automatically order the product they need from their favourite store, delivered to their door. This innovation would connect ecommerce to the way we interact with our homes, and has the potential to allow brands to develop a more meaningful connection with consumers.
  1. Wearable technology – for retailers and consumers
From giving shop assistants the information they need on-the-go, to giving shoppers a more personalised experience, wearable technology is a branch of IoT, which could transform retail.
In store, both shop assistants and consumers will have the information they need. Shop assistants could have access to further product information, stock levels, as well as customer data. Shoppers, on the other hand, could have an enriched in-store browsing experience, with extra information, navigation and promotional offers.
  1. In-store sensors
Whether you want to attract shoppers through your doors or tempt people to browse your new collection when in-store, sensors, such as Bluetooth beacons, are an IoT technology which can help you do just that.
Picture the scene – an existing shoppers walks past your store, your in-store sensors would allow you to send that customer a personalised message about a promotional offer you are running in store. Once inside the shop, you can target shoppers based on their shopping and browsing history. This could not only enhance the customer’s experience and boost a retailer’s marketing efforts, but provide a wealth of path-to-purchase data, which can be used to optimise store layouts.

  1. Smart mirrors in fashion retail
As an extension on RFID tagging, various parts of the store could connect with the products themselves. For instance ‘smart’ mirrors could recognise which products a shoppers was wearing and then suggest other items which could be paired with that garment – allowing the shopping to visualise some fashion pairings in the mirror.

Overall, IoT looks set to begin a new, more data-driven age for retail. With connected devices, retailers can analyse shopper behaviour, as well as their own performance with greater accuracy and offer a more responsive and personalised service. Find out how we can help you prepare for a world of connected shoppers and devices on our omnichannel page.

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