8 Advantages of IoT in Retail Industry

IoT has undoubtedly disrupted every aspect of the real world and it's not to stop here. It's rapidly moving towards making an enormous impact on aspects of everyday life. According to a forecast by Sparklabs “an exponential growth in the IoT space—from 2.5 billion devices in 2017 to 5.4 billion in 2020.”
 

The retail industry is yet another sector that is exponentially benefiting from the advantages of IoT. Right from customer experience to supply chain management, IoT is moving towards making retail completely different for the future. 

 

IoT is not something that is going to be used by retailers in the future. More than half of the major retailers worldwide have already been successfully applying IoT.

 

According to a forecast by Grandview Research, the IoT-enabled retail market will be worth $94 billion by 2025 because of its growing popularity among all players. Let's have a look at the most significant advantages that IoT offers to the retail industry.

 

 

Advantages of incorporating IoT in the Retail Industry

 

1. Modernize Supply Chain Management to a great extent 

 

Retailers are increasingly opting for IoT solutions like GPS sensors and RFID tags to ensure high transparency. They can stay updated about the movement of goods right from manufacturing to the delivery of the product. 

 

IoT offers a major advantage to retailers through its real-time detection feature. It proves to be a big boosting aid in analyzing factors such as the time spent on transportation, or the ideal temperature to store goods or products. 

 

For retailers who are dealing with perishable products, this data comes in handy to determine the right temperature of storage. This is undoubtedly an extremely crucial aspect of efficient supply chain management.

 

Some experts believe that approximately three-quarters of retailers plan to modernize their supply chain management using advanced IoT solutions.

 

 

2. Boosts customer experience and value 

 

Video surveillance cameras, mobile devices, and social media sites and platforms allow retailers to get better and useful insights into customer behavior. This way, IoT opens new pathways for leveraging data analytics. Retailers can not only easily predict customer behavior but also work to enhance customer experience. 

 

Data says that 8 in 10 retail stores have been able to provide an enhanced customer experience. This not only ensures happy customers but also leads to a much more efficient and organized business. 

 

 

3. Inventory Management becomes much simpler 

 

It is a well-known fact that inventory management is not only cumbersome and time-consuming but a struggle in itself. If not tracked accurately, stock-outs and overstocks can entirely drain a business. But the biggest relief is that IoT can significantly reduce this headache of inventory management by automating inventory visibility. 

 

IoT provides smart solutions such as store shelf sensors, RFID tags, beacons, video monitoring, and digital price tags that go a long way in enhancing the prospects of retail businesses especially when it comes to procurement planning and strategies. 

 

IoT data helps in generating highly significant analytics. This is of great importance, for instance, the system can re-order the required amounts of goods needed whenever product inventory reaches a low level. 

 

 

4. Automated Points of Sale systems (PoS)

 

The last thing that a retail business can ever dream of is customers finding themselves annoyed after standing in long checkout lines and often, leaving without buying anything at all.

 

To save retailers from ending up in such a situation, IoT solutions have worked towards making check-outs less labor-intensive and bearable. 

 

This is achieved by automating point of sale (PoS) systems. An automated point of sale system can easily read tags on products as soon as the customers are done with their shopping. They can be later charged using mobile payment apps. This process makes check-outs faster and more efficient, both for the customers and the retailers. 

 

 

5. Foot-traffic monitoring is a great tool for enhancing customer value

 

Video-based foot-traffic monitoring in a smart store allows a retailer to check the product area where customers are spending more time and accordingly this information can be of great help either in real-time or later. 

 

For instance, in a service-level-time, the system becomes easy to help out the customer and later this information can be used to make the store layout more user-friendly. 

 

In a small store, the complete shopping journey can easily be comprehended by examining the mall traffic across several retailers. 

 

Analyzing store traffic is the key to creating a wonderful in-store shopping experience for customers. This precisely explains why more and more retailers are opting for IoT-powered solutions. 

 

(Read also: Applications of IoT in Businesses)

 

 

6. Forecasting maintenance issues 

 

Energy management, estimating equipment failure, and preventing other problems before they occur becomes a child's play once after using predictive equipment maintenance.

 

When all the crucial types of equipment are fitted with sensors, maintenance issues can be easily predicted. For retailers dealing with perishable items, units like refrigeration and HVAC systems hold a lot of importance to ensure the safety of products. 

 

 

7. Demand-alert warehouse fulfillment

 

Another highly advantageous aspect of IoT to the retail industry is that it helps in monitoring sales and opportunities. Missed in-store sales can be tracked leading to efficient warehouse automation. 

 

RFID makes possible a highly accurate service-level optimization and much effortless inventory management.

 

IoT has paved the way for a technology-led warehouse driven by in-store and online shopping demand. In the future, the automated pallets will be self-organized depending on real-time demand.

 

 

8. Increased efficiency in moving merchandise 

 

Moving merchandise in an organized manner is a major headache for retailers. Though many retailers have been using GPS to track and route goods transportation for years it has limited advantages to offer.

 

However, IoT holds a great significance in the maintenance of transport, tracking, and route optimization. IoT helps retailers in getting a more accurate idea of the proximity of a pallet of merchandise to the store.

 

(Suggested blog: Applications of Big Data in Retail Sector)

 

 

Ending Note

 

This blog ends here. While reaching the end of the blog, it can be seen that IoT has revolutionized the way retailers used to look at achieving growth in their industry. To get an edge over their competitors, IoT has been and continues to be a huge support.

 

IoT applications are rapidly transforming the retail experience worldwide. It has been proven that IoT solutions can sustain a wide range of retail services and aspects. Retailers can focus on building and maintaining strong, long-lasting relationships with their customers and thus making sure of staying ahead of their rivals.

 

The growth of the retail industry has been accelerated by IoT applications leading to a much higher business efficiency of firms than ever before.