How the Internet of Things is changing the retail industry

Much has been said about the negative impact of the pandemic on the retail industry – one of the hardest hit sectors worldwide – but there are plenty of positives, particularly for smaller or niche retailers, most of whom were already operating solely online.

E-commerce accounts for nearly 21 per cent of the retail market share in North America, according to the Centre for Retail Research, a number that increases significantly for millennials (36%) and Gen Z (30%), both of whom cite price comparison and larger stock levels as their pre-pandemic reasons for shopping online. With so many businesses forced to move online, and now happily staying there, it’s time to talk about the Internet of Things (IoT) and how it’s changing our industry.

Are you IoT savvy?

The industry has certainly embraced the IoT recently, but more importantly, so have consumers. A recent report by Grandview Research estimates that the global connected devices retail market will be worth $182 billion by 2028. What does that mean? It means it’s time for all of us in the retail sector to get and stay hyperconnected. Forget just an e-commerce storefront – we need to be Apple Watch, flip phone, tablet, Kindle, desktop and laptop ready.

How IoT can help retailers

But it’s not just about making sure the IoT helps our customers – how can it help us? That’s right - IoT technology is actually making things easier for the retail sector.

The truth is, we’re already operating in an IoT world, using one app to find the best parking spot and pay for parking, another to navigate shopping malls, and a few more to find the best discounts at our favourite stores and to use automated checkout. Some stores, such as Target (a haven of shopping bliss for North Americans), have an app that pings as soon as customers enter the store, allowing them to navigate the store quickly in search of the items on their list and even suggesting deals and discounts tailored to them. 

 There are plenty of ways IoT can help the retail industry. Firstly, there’s data gathering – connected devices and systems can be set to collect data throughout a customer’s retail journey, from browsing online to point of sale in store, collecting everything from payment methods to shopper demographics. Once the data is processed, it can be analysed to give invaluable insight into trends, how to improve the shopping experience, and even the store layout.

Then there’s automation – using even the simplest AI and machine learning algorithms, connected shops and smart machines can help automate complex tasks and processes, leaving you and your people free to do the strategic and one-one-one customer work.

Disney World is a perfect example of this type of service. With their Magic Bands, guests can pay for food and retail, calculate waiting times, sign up for fast ride passes and, overall, have a better experience in the park - whether riding the attractions, dining or shopping. The project has been a huge success and provided the “House of Mouse” with plenty of user data that’s been collated and shared to improve guest experiences everywhere, from Disney’s hotels to the car parks!

And then, of course, there’s Smart Shelf by AWM, a technology that’s improved stock checking and shelf filling so much that it’s nearly unbelievable. It can be used to manage inventory, help customers find the right products, and track the customer demographics all at the same time. With an estimated 30 billion hyperconnected IoT devices already in circulation, this is literally the present and future of retail reality.

But how do we stay safe when everything and everyone is connected?

Unfortunately, for every positive use of technology, there’s an equal and opposite negative use. The retail sector was one of the top targets for cyber crimes in 2021, meaning that IoT security needs to be right at the top of every retail manager’s list.

Because so many retailers, especially SMEs, had to make the jump to e-commerce-only so quickly, many were left vulnerable. Large companies have dedicated Chief Information Security Officers, and even then, some of the biggest companies in the world can fall prey to cyber attacks. POS and customer information are the two areas most targeted by hackers, obviously, but complete end-to-end protection is the best approach.

Thankfully there’s technology that’s been built with the IoT in mind, as well as prepared for when/if blockchain tech starts taking over. British company Arqit’s QuantumCloud is a simple cloud-based platform that means you don’t have to rip out all your existing infrastructure and start over, you can simply install the software and get started, knowing all of your information is more secure than ever.

There’s no doubt about it, gentlefolks – the IoT is here and we’d better get to grips with it if we want to stay ahead of the competition.