Five Internet of Things applications for the retail industry16October

Five Internet of Things applications for the retail industry

The Internet of Things (IoT) brings together various devices such as fitness bands, sensors and beacons, and is already being adapted by the retail industry to fit its specific requirements. The IoT is capable of connecting together physical and online stores, and can increase sales and lower costs by creating synergies and improving stock, inventory and logistical management. However, despite potentially being the main beneficiary of these technologies, the retail industry is not yet taking full advantage of everything the IoT has to offer.

 

Five suggestions to help you benefit from the Internet of Things:

1) Connect the storage to the shop floor

One of the biggest problems faced by physical stores is the need to check the storage to see whether goods shown on a computerised inventory list are really available. When information on the screen fails to match the storage the result is that sales assistants waste time searching for items, goods end up in the wrong place and shelves are left empty despite the fact that items are in fact available.

 

In the past we used closed circuit camera systems to avoid these problems, but today we have RFID tags, sensors and beacons. While tags work passively, beacons work actively and by using the right devices on the store’s shelves and in the stockroom you can drastically improve stock control. There are also various examples of software-based sensors, such as those that read product labels on shelves and others that scan RFID tags. Such sensors are monitored on special software, while smart screens can be used to display digital price tags. The result is that discrepancies between the prices shown on shelves and at the till can be eradicated, also avoiding potential bad customer experiences. In addition, sales staff can understand exactly how many products are left on the shelf, and lost or misplaced items become increasingly rare.

 

2) Speed up inventory tracking

The secret to inventory tracking is to start at the production stage. By knowing the production output you will not be limited by the supply chain and can speed up inventory tracking. This will also allow you be informed about any delays and problems in the supply chain. Of course this is particularly important for non-durable goods, such as fresh fruit and vegetables and other items. For this reason, two world-famous chocolate producers have placed thermometers on their products to track temperature and humidity, enabling them to take precautions and avoid their products deteriorating by ensuring they are sent directly to shop shelves to be sold.

 

By using vibration and altitude sensors in cargo planes it is even possible to prevent the breakage of crystal glassware. In fact, it is even possible to detect mistakes made by suppliers and cargo companies, thus placing the responsibility for replacement costs onto the proper party. With these systems, companies no longer have to return stale food or products that have been broken during the transportation process. In addition, in the event that a product needs to be recalled, companies can immediately see which stores have unsatisfactory items in stock and the process can be accelerated. Product tracking using RFID tags allows greatly increased control over the supply chain process.

 

3) Reduce fraud and waste

Thieves and malicious staff can cause problems for giant retail chains and independent outlets alike. In fact, it is estimated that North American retailers lost $42 billion to this type of problem in 2014. So how can the Internet of Things help to solve it?

 

In order to be sure a product ends up being sold it is important not to focus only on the point of sale and shop counter. Instead, in addition to placing sensors on shelves, you should tag all products with RFID-based SKU’s at the very first product exit point and then connect the sensors and tags to security cameras using special software. In this way, goods can be protected from theft from the moment they leave the factory, during delivery and throughout their time in stores. In short, inventory is monitored instantaneously and at all times.

 

This system can also help to improve customer relations. For instance, a customer requesting a refund can prove that he purchased the item even without having kept the receipt, while fraud can be prevented when similar claims are made by those who did not in fact purchase the goods.

 

4) Offer timely promotions and coupons

According to an article published by the Harvard Business Review, studies have shown that retailers that have both physical and online stores generate more sales than those without physical stores or those whose stores are inconveniently located. In other words, physical stores increase online sales and are a major advantage to e-commerce. Conversely, online sales and marketing can also increase sales in physical stores. Even if you don’t run an online store, a good website and social media presence can still help you to understand the demands of existing and potential customers and keep you in tune with their expectations and levels of satisfaction

 

Just as you collect customer information from your website or social media accounts, you can also obtain highly valuable marketing data with the help of sensors, beacons and digital promotion systems, as well as from interactive devices or mobile applications being used in the store. All of this can help you to improve the efficiency of your strategic decisions about product selection, pricing, store locations and so on. You can discover which customers need different kinds of products, which stores they visit most frequently, and offer appropriate promotions and campaigns on the products that your customers need exactly when they need them, thus greatly increasing your chances of making a sale. The IoT also improves opportunities for cross sales and encourages customers to buy more expensive items by reaching out to them when they are likely to need a certain product. By deploying beacons you can track how customers behave in your stores and show them products related to the ones in their e-commerce shopping carts and serve up highly targeted banner adverts when they get home.

 

5) Make your stores easier to navigate

Large retailers like IKEA have for a long time worked hard to improve the way they encourage customers to navigate their stores. In doing so they plan shelf layouts, product arrangements and routes through their stores so as to optimise customer traffic and maximise sales. This has generally been done using security camera data and trial and error.

 

However, it is now possible to get better results with beacons and sensor-enabled cameras, floor sensors and people counting systems, all of which can be integrated using smart software. Such systems make it possible to analyse in-store navigation models using face, movement and voice recognition technologies. The software then provides suggestions to shop owners on how to arrange products, and offers tips on how best to use every square metre as efficiently as possible.

 

After using this technology, some well-known companies have decided to place special recreational and entertainment space, such as small cafes between aisles. It can also be used to identify the most visited areas of stores and install TV systems, smart digital displays or special products in them. Or aisles that are subject to congestion can be rearranged, while others can be used to offer complimentary food and drink.

 

You can immediately apply to solution providers and get started with using the innovations provided by Internet of Things technologies, creating original solutions that make the best possible use of your stores, give you a competitive edge and increase your sales.