There is a lot of hype surrounding the Internet of Things (IoT). The challenge this presents is in deciphering how an IoT solution can deliver better information—not just more data—and tackle specific pain points that lead to customers entertaining a new investment. Navigant Research believes the significant benefits associated with IoT are transforming commercial facilities into intelligent buildings; two specific business benefits of IoT can be highlighted by exploring the application of IoT in retail spaces.
First, IoT can help shoppers spend where their dollar aligns with their green priorities. In 2015, Nielsen released the results of a global survey that demonstrated a shift in willingness to pay and purchasing trends among millennials, the largest segment of the population. About 72% of respondents reported they are “willing to pay more for products and services that come from companies who are committed to positive social and environmental impact.” This was an increase of 17% from 2014—if the trend continues into 2017, close to 90% of millennials will be putting their green where the green is.
IoT can be the technology backbone to qualify the sustainability claims of retailers. Accurate tracking of energy consumption and equipment performance made possible by IoT infrastructure can help retailers quantify their efforts with data. Energy efficiency efforts can be monitored and verified with real-time data to inform annual reports and marketing efforts on sustainability.
Second, an IoT solution can improve the shopping experience by improving customer service with data-directed sales support. An IoT solution can provide retailers with detailed data on customer traffic, illustrating the flow of customers throughout their stores and even the time spent browsing in specific locations. If store managers utilize this data, they can be proactive about staffing and create new strategies for product placement and incentives to move customers throughout their stores. The efficiency of speedy checkout and the product placement enhanced by this occupancy data can help enhance the shopping experience, which suggests a new avenue to create return and long-term customers. Carrie Ask, Levis’ EVP and president of Global Retail, recently explained the concrete benefits of deploying IoT solutions. “On the opportunity side, we were underestimating the potential within our store traffic to drive sales and conversions. … And on the stakes side, we also realized that when we’re out of stock, not only do we lose in the moment the chance to drive a planned or impulse purchase, but the disappointed consumer may decide that the trip to the store was not worth it—jeopardizing future traffic,” she said.
Interested in hearing more about the role of IoT in retail? Join Navigant Research along with Rick Lisa, Director of IOTG America’s Sales at Intel; Greg Fasullo, CEO at Entouch Controls; and Craig Robinson, Partner at Traverse Ventures Partners for a roundtable conversation exploring how the IoT is redefining the retail experience on February 14 at 2 p.m. ET. Click here to register.