That Internet of Things (IoT) is fast driving innovation and new opportunities by bringing every object, consumer and activity into the digital realm, is not news any more. And going ahead, the proliferation of connected devices coupled with improved, less-expensive technology platforms will only disrupt the rapid growth of IoT-enabled capabilities across industries. According to a recent McKinsey Global Institute report, IoT is forecasted to have a total economic impact between $3.9 and $11 trillion a year by 2025, including $410 billion to $1.2 trillion per year in retail environments.
Thus, it goes without saying that retail has been one of the primary industries that IoT has had a disruptive effect on. Many retailers are already looking to harness the voluminous data resulting from IoT to boost their bottom line not only via smarter supply chains, but also by specifically tailoring their marketing to cater to the needs and preferences of individual consumers. And this is just the tip of the iceberg. According to recent Juniper Research, retailers are predicted to invest $2.5 billion in IoT over the next five years. Much of that investment will be for beacons and RFID.
In this blog, we will discuss in detail about some of the most innovative examples of IoT in retail and the kind of future implementations can retailers look forward to.
Internet of Things examples in Retail
While IoT provides retailers with a whole lot of new data to mine for insights, the fundamental objectives remain the same as in the case of traditional marketing: to be relevant to the customer and offer a desired service. Let’s take a look at few retailers who have rigorously followed this objective to the T and implemented IoT to improve the customer journey and create a deeper degree of loyalty among customers.
1. Rebecca Minkoff reinvented the dressing rooms with smart mirrors
Image Source: digitalsignagetoday.com
In her attempt to bring the concept of a ‘connected store’ – an outlet where the facilities of brick-and-mortar stores are coupled with the diversity of online shopping, to life, Rebecca Minkoff reinvented her in-store dressing rooms with smart mirrors. RFID tags on each item of clothing help recognize the items that are brought into the dressing room, and allows shoppers to pull up product screens that show the item styled with different looks, as well as other available sizes and colors. Thus the smart mirror in store fitting rooms, allows customers to try on products, search and receive additional products from a store associate, try different lighting and then store items for later reference — all without ever having to leave the fitting room.
Customer Benefit – Customers experience a very personalized fitting room session, while retailers receive volumes of data about the customer, what customers try on versus buy (and also don’t buy), how customers are pairing items and more.
2. Target leveraged beacons to make hyperlocal content accessible to shoppers
Image Source: startribune.com
Target recently leveraged beacons across 50 stores, to make hyperlocal content accessible to shoppers via a newsfeed-like stream on Target app’s homepage called ‘Target Run’. In a general scenario, customers who have downloaded the Target app and enabled Bluetooth on their device will receive product recommendations related to the department that they are currently located in, as a push notification or as an in-app update on their phone.
And now, this same information can also be found on the new Target Run page, which operates similar to a social media site’s newsfeed, with the latest content (product recommendations or coupons based on the user’s location) being added on the top of the page. For example, an in-store customer browsing clothing might receive notifications about apparels that are currently trending on Pinterest. And then, as the shopper makes her/his way to the food section of the store, a list of available grocery promotions will move to the top his/her newsfeed.
Customer Benefit – Beacons provide personalized offers and in-store shopping information right when the customer will benefit from it most.
3. Amazon launched the Dash Button to allow for frictionless replenishment ordering
Image Source: forbes.com
In its attempt to make the shopping process as automated as possible and allow customers to buy new products without thinking about them and, more importantly, without shopping around, Amazon launched the Dash Button early this year. The Dash is a single-use Wi-Fi enabled ordering device that is tied in with the Amazon’s Dash Replenishment Service, a system by which products such as washing machines, printers etc., can automatically order refills when they run out, straight from Amazon.
As part of this launch, Amazon partnered with a range of brands including razor firm Gillette, moisturiser Olay, and coffee system Tassimo to brand the buttons. Each button connects to the internet via home Wi-Fi and can be configured with the Amazon shopping smartphone app to purchase a specific item when pushed. Adding on to that, it also alerts users every time a button is pushed and allows them to cancel orders within 30 minutes of a button press via the smartphone app.
Customer Benefit – Provides for frictionless replenishment ordering.
4. Ralph Lauren’s PoloTech shirts measure heart rate and calories burned
Image Source: forbes.com
Ralph Lauren recently launched Polo Tech apparel, a smart workout shirt that monitors the vital activity stats (heart rate, calories burned, steps taken, breathing depth etc.) of the wearer in real time. Adding on to that, the sensor-filled black box snapped into place near the rib cage allows users to sync the statistical information to an iPhone app. This allows users to keep track of biometrics and check out adaptive workouts based on their activity data.
Customer Benefit – The data connects to the customer’s PoloTech app for ongoing health monitoring and customized workouts.
Future retail implementations of IoT
Going by the current rate of proliferation of connected devices, these above mentioned examples only constitute the beginning of much deeper retail opportunities. To make the most of the IoT opportunity at hand it is highly critical for retailers to analyze how they can leverage IoT to transform the business by unlocking new growth opportunities and deepening customer loyalty.
Going forward, retailers should look at IoT as a means that allows them to help their customers by, for example:
1. Proactively telling a runner that it’s time for a new pair of shoes based on the number of miles that the he/she has run.
2. Reminding a customer that it’s time to take a prescription medication or apply more sunscreen. A retailer could help the customer further by knowing about other medications or calibrating the sunscreen reminders to the weather, UV levels and the degree of skin sun sensitivity.
Are there any other innovative IoT retail examples that we missed out on? Let us know in the comments below.
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