3 Ways IoT Can Enhance and Expedite Your Retail Business

May 5, 2021 - 7 minutes read

If there’s one thing we know the Internet of Things (IoT) can accomplish, it’s automation, expedition, and optimization. For businesses that have begun utilizing IoT applications in the past few years, many have seen a strong return on investment, improved business operations for employees, and more data about real-time business processes. Although we haven’t seen IoT in retail in the form of robots helping us shop or find a product, IoT has improved operations and transparency in factories, warehouses, shipping, and supply chains for retailers.

A report by Markets and Markets predicts that the retail IoT market will reach $35.5 billion by 2025. Here are three ways IoT is already making waves behind the scenes in retail.

Image Recognition

Retail is a complex business with a lot of moving parts, and not all of those moving pieces involve customers directly. Many improvements that IoT offers affect the customer experience, but the customer won’t know the full extent of the role that technology played in getting their package delivered on time. For example, warehouses need to operate at maximum efficiency and output to promise customers a specific delivery date range.

But warehouse employees often become exhausted and start losing concentration after several hours of work, which causes errors and delays. With image recognition, businesses can increase employee output without interfering greatly in their workflows. For example, IoT-enabled image recognition devices use AI to identify any incorrect product placements, labeling, price tagging, and low stock issues.

Image recognition is also used to visualize the complete picture of work, allowing errors to be found in real-time and fixed before it impacts the business or customer.

Automation in Operations

Retailers can use IoT to track orders, manage delivery, keep an eye on their warehouse, and inventory items in real-time. Tracking assets helps reduce the cost and effort of manually tagging and moving them.

Automation can step in to take care of the hard work, but it won’t come without significant investment in emerging technologies like AI, augmented reality, beacons, digital signs, and more. IoT sensors and devices already exist to track assets for the purposes of automation, but they need to be added to an ecosystem that will allow them to perform at their highest potential.

Many companies have implemented beacons with a return on investment. Beacons can be used to track movements around the store, and the resulting data can be analyzed to understand how customers navigate around the store. You can also utilize beacons to send customers coupons and notifications about promotions based on their real-time location and past purchase behavior. Ultimately, when done with the right frequency, beacons can enhance the customer’s shopping experience and elevate the business’s brand image.

Order Fulfillment

Order fulfillment is a major part of the retail experience. It’s so important to e-commerce that companies like DHL, Alibaba, and Seattle-based Amazon invest massive amounts of budget into optimizing their inventory tracking and order fulfillment operations. With IoT, the complexity of pulling the correct item, packaging it up for shipping, generating the correct shipping label, and sending it off to the carrier no longer is prone to errors.

Employees often experience less physical injury, feel safer, and report more productivity when working alongside IoT technology. That alone is a great major benefit of IoT. When your employees are happy, your customers are happy.

IoT is also used in order fulfillment to provide a real-time look at inventory on the shelf. Kroger has been utilizing RFID tags, sensors, and IoT devices to create 2,000 smart shelves that accurately track inventory. Analysts at Kroger then analyze the best place for products, what products need replacement or refilling faster, and how product quality affects consumer behavior. This analysis is used across many Kroger stores, and it’s also used to directly impact the store that’s generating the data. The manager can be alerted to a wet floor or a fire that just started.

Kroger’s smart shelves also integrate with the Kroger app to send customers coupons and promotions when they’re in the right aisle. They utilize the app to highlight items on the customer’s Kroger app shopping list as they’re walking in the aisle. This is an improvement and idea that any retailer who sells a wide variety of items can employ to upgrade the customer experience.

It’s also extremely important that retailers prioritize their equipment when implementing IoT. IoT is a great technology that can help reduce equipment replacement and repair costs by tracking the performance of the equipment and identifying any anomalies in the data. By finding the issue faster, retailers can simply maintain their equipment, rather than allowing it to break down and cause multiple days’ worth of revenue loss.

Drones and GPS trackers are other technologies that can help retailers better take care of their costly equipment. For example, delivery vehicles can be tracked for wear and tear and mileage. After the vehicle has driven a set amount of miles, it should be serviced. This lifts the burden of tracking miles off of the driver, allowing them to focus on delivering the package to the correct address. IoT devices can also measure engine performance or listen for any sounds that seem abnormal.

The Next Generation of Shopping

IoT is a technology with immense potential if you know where to use it and how to use it. It provides end-to-end transparency into the supply chain, warehouses, inventory, logistics, and order fulfillment. IoT can even revive a dying retailer by offering a new unique value proposition for the customer. The future is bright for retail and e-commerce thanks to IoT.

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