The retail industry has experienced a rapid transformation in the last 20 years.
And like other industries, the retail industry is also embracing the Internet of Things (IoT) technology for the innovative opportunities it offers.
In fact, IoT has already been embraced in retail all around the world.
For instance, the IoT in the retail market has been increasing at a whopping 20% CAGR since 2015 and it is forecasted to reach $35 billion in 2020.
That being said, let’s examine the top 4 opportunities IoT technology holds for the retail industry in the year 2020 and how you can capitalize on them.
IoT in retail: 4 Opportunities for retailers in 2020
Retailers that have embraced the IoT technology have already experienced benefits like reduced costs, improvement in overall performance, and enhanced customer experience.
Below, we’ve shared the top 4 opportunities that IoT offers to the retail industry and how retailers can leverage them to their advantage.
1. Supply chain and logistics
IoT technology is largely regarded as a consumer-facing innovation. But, in reality, that’s not the case.
There are, in fact, many IoT tools that help businesses in increasing efficiency, improve operations, and prevent loss.
For instance, many retailers have already started using IoT sensors to monitor their goods throughout the supply chain.
IoT offers many types of tracking systems that help to generate different valuable insights like location, tilt, temperature for better quality control and traceability.
These tracking systems also allow retail businesses to determine if their goods are safe, being transported in ideal conditions, and are delivered on time.
In fact, Deloitte also confirmed that 74% of retailers who embraced IoT technology in their logistics & supply chain witnessed a surge in their annual revenue.
2. Asset monitoring
Retailers often have to face the recurring expenses of their assets such as shopping carts and baskets being lost or misplaced.
On average, each shopping cart costs between $50-$250 to retailers, which drastically increases the expense of shopping cart replacement.
To combat this, you can use IoT technology to track all the lost or misplaced shopping carts and baskets. Tracking these assets can greatly reduce the overall costs.
For instance, you can integrate IoT sensors on each asset, which allows you to track them to their exact location. These tracking IoT-based devices can function both indoors as well as outdoors.
Apart from this, the IoT sensors can also help to make sure that there are enough empty shopping carts and baskets available for your customers all the time.
3. Personalized discounts
If your retail business has a high amount of recurring customers, then rewarding them for their loyalty can greatly contribute to customer experience as well as revenue.
For instance, many retailers have now set IoT sensors in their stores that send exclusive discounts to their most loyal customers each time they pass near certain products with their smartphones.
All you have to do is build a retail app or integrate the loyalty program feature in your existing app to send exclusive discount offers to customers who have signed up for the loyalty program in advance.
Apart from this, you can also allow customers to track products that they looked online and send them a discount offer when they’re in-store.
This way, you can send personalized discount offers instead of offering a general discount, which can increase the probability of sales.
4. Customer satisfaction monitoring
IoT has proved to help retailers provide customer satisfaction to a great extent. The IoT sensors have the capability to collect feedbacks quickly so you can work on them and provide a better customer experience.
While logistics is the key area where IoT can help to provide better customer experience as well as services, there are however many other areas where IoT can make a huge impact on customer satisfaction.
For example, IoT devices collect a lot of data and this data can help you optimize or reinvent your popular products.
In other words, IoT can help you find potential issues, identify when maintenance will be required, and alert customers about it in advance.
So, these are the main areas where IoT will be transforming the retail industry in 2020. However, there are many other opportunities that IoT will bring for retailers.
For example, IoT technology integration in the retail industry will help retail businesses in creating successful marketing campaigns from customer behavior data. And this is just one example. In the coming years, more and more retail businesses are expected to embrace IoT solutions to drive dramatic shifts in their businesses.