Internet of Things Connects Retailers with Revenue
The connection of devices offers businesses a great opportunity not only to collect data and learn about how customers interact, but also to gain insight on why certain products are popular — and others are duds. The Internet of things is a network of Internet-connected machinery that can offer a detailed glimpse of customer behavior.
The IoT has enormous market potential; GE Chairman and CEO Jeff Immelt has publicly said that GE would invest $1 billion in creating Industrial Internet technology and applications to help customers become more productive. Immelt estimates that “Industrial Internet” could add $10 to $15 trillion to global GDP during the next two decades. And research firm Gartner predicts that the IoT will comprise 26 billion units installed by 2020; by then, IoT product and service suppliers will produce incremental sales revenue of more than $300 billion, mostly in services.
In the retail segment, IoT can produce substantial savings, as well as be a catalyst for additional revenue. Knowing when stock of a particularly popular item is depleted, as well as who has bought it and who is likely to buy it can all be accomplished when devices are “talking” among themselves. Deliveries can be scheduled optimally and personalized promotions that are relevant to shoppers can be used to promote a “customer first” atmosphere. For instance, the store mannequin connected to a camera that is connected to facial recognition software can provide insight to store owners regarding who shops when, so other types of promotions can be used to drive store traffic at desirable times.
Gathering, storing and analyzing data that comes from the IoT can offer retailers information that can help them increase their businesses. PCs, tablets, backend systems can all be connected via small sensors. IoT enablement can help to blur the lines between in-store and e-commerce shopping experiences as virtual reality changing rooms and interactive displays are used to create an increasingly seamless experience.
Because the IoT is expected to expand swiftly— some figures say more than 30 percent annually — retail management software can help store owners take advantage of the trend. For example, some customers may use smartphones to shop online while others use tablets. Still others will feel most comfortable on a laptop computer. For retailers, that information can be very relevant as they continue to understand how their customers shop. Some customers will respond to improvements in point of sale at their brick and mortar, while others will appreciate an efficient site experience. The more a retailer knows about a customer’s shopping habits, the better it can serve that customer and anticipate his or her needs.
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