The Internet of Things is back on the agenda for retailers. Despite waning interest over the past few years; 2016 has seen a major resurgence of interest in retail internet of things connected devices. Driven in part by innovative products such as Amazon Dash and Amazon Echo; smart connected devices that make it faster and easier for consumers to shop – both in store, and at home – are now top of mind for businesses.
But the Internet of Things isn’t just changing the way that consumers buy; it’s also helping retailers drive profits – not just by subtly steering customers to buy more, but by making in-store operations more efficient.
The Internet of Things was a term first coined by British entrepreneur Kevin Ashton to describe a network of “smart” devices. These devices either connect to the internet, or to each other. They collect, share or analyze data, and interact in ways that help make us more efficient.
McKinsey estimates that by 2020 we’ll have between 20 and 30 billion connected devices. Gartner has a slightly more conservative view – suggesting just over 20 billion. Either way, it’s clear that “smart” devices are set to play a bigger role in our daily lives.
And, whilst early uses of IoT technology focused on making our homes or workplaces more efficient – many retailers are now utilizing this technology to come up with innovative solutions that make the shopping experience easier and more enjoyable.
Customer experience is increasingly important. Even online retailers are now increasingly focusing on improving the customer experience by offering shopping experiences tailored to each individual. In-store, retailers are turning to solutions that make the whole shopping experience as enjoyable and efficient as possible – and it’s easy to see why. Harvard Business review recently found that “customer experience is a major driver of future revenue”.
Connected devices, such as scan-as-you-shop technologies are now used in major supermarkets (UK retailer Tesco recently implemented these across a number of its stores) to simplify the check-out process. They eliminate long lines at the registers, and help customers keep a real-time view of their total as they shop.
Not only does this enrich the customer experience, but it also means that fewer cashiers are needed at the checkout. In this way, the IoT is helping retailers optimize employees’ time; giving them more time on the shop floor, and more time to focus on profit-producing tasks.
By utilizing smart solutions, retailers can make their whole operations more profitable – combatting higher costs, slimmer margins, and tougher competition.
In the supply chain, RFID technologies can help monitor inventory, optimize ordering and reduce shrinkage. Fashion retailer Zara admit to using RFID chips to keep a closer eye on its stock and to “replenish racks more quickly”.
At the checkout, solutions such as Intelligent Cash Drawers are providing retailers with real-time views of the cash across their stores to drive more effective cash management.
Tellermate’s Intelligent Cash Drawer, LiveDrawer, connects with POS systems and counts cash automatically as it is placed in the drawer. This eliminates the need to manually count cash during shift changeovers and keeps cashiers on their registers for longer.
By communicating directly with the Point of Sale, Intelligent Cash Drawers collect and display cash data at a transaction-by-transaction level; allowing store managers to identify everything from internal theft, to low change levels, to customers being short-changed.
And, with employees spending less time on manual tasks, such as counting cash; these innovative registers are a smart choice for retailers looking to accelerate the checkout process for all customers – not just those who pay in cash.
It’s clear then, that while customer experience is still a key concern for retailers, and while many IoT connected devices are specifically developed to help improve this; the Internet of Things is no longer just about customer experience. It’s changing not just the way we buy, but the way that things are sold, and even the way that stores are run.
By utilizing IoT technology to streamline their operations, retailers can be more efficient. Smart devices that alert staff or managers when customers require assistance, or when tills are running low on change will eliminate annoying waiting times for customers and help improve the in-store experience. Those retailers who invest in these connected solutions will ultimately benefit from happier, more loyal customers and in-turn – increased revenues.