The way businesses work is changing—and not just at the rate of a nice curve steadily inclining on a graph. That line is shooting up almost vertically at an astonishing pace. Companies come and go almost overnight, as do new products and services that were considered cutting-edge just a year ago. The pressure is on to keep competitive all while reducing costs and building a large customer base that keeps coming back.
Business is now a game of keeping up with the Joneses Inc.
The retail sector is no different, but it’s dealing with specific challenges of its own triggered by changes in how we shop and what we’ve come to expect from our experiences of the brands we buy from. In short, we’re more demanding, more ethically conscious, and more savvy about retail.
Brick and mortar retail is dead!
The need to keep up with customer expectations is piling on the pressure to adopt ever-increasing amounts of technology to gain a competitive advantage. And, in the last decade we’ve already seen the first major technological shift: online shopping.
According to IBM, 58% of retailers agree that businesses focused only on brick and mortar stores will not survive much beyond the next few years. But online shopping hasn’t only moved money away from the shop floor—it’s changed how we shop. People now do extensive research and comparisons between products and retailers, look through comments on social media to read fellow customer reviews, and keep a digital eye on products to get the best price at the right time.
For a moment, just think about checking out on the Amazon website to consider what the high street is up against today. Amazon tells you what other shoppers think of the product you’ve selected, what else they bought when buying the items that you have in your basket, and automatically offers discounts if you select an accompanying item. Oh, and you needn’t even leave the sofa, let alone the house—most things are delivered to your door within 2 hours (Amazon will even open your front door and drop it inside if you’re brave enough with their Amazon Key smart lock) and that’s before the widespread use of autonomous drones.
What about booking a flight on Ryanair? You’re offered a new cabin bag, a hire car, a hotel, a day-ride bus ticket, discounts at local attractions, and a table at a range of local restaurants along with every other conceivable item that can be tenuously linked to your trip. How can a brick and mortar retail store keep up?
You might argue that they simply can’t. Retailers needs to embrace online shopping or face being left behind. But, excitingly, the Internet of Things offers something that could put shopping back into shops… and give them a competitive edge.
Long live brick and mortar retail!
The Internet of Things is already shaping the present and future of retail. It puts the customer at the core, transforming shopping experiences through smarter, data-driven, and personalised merchandising and marketing.
Walk into any Apple store and you’ll see their staff roaming around with iPhones or iPads. That isn’t just some in your face product placement. It’s allowing them to check stock and serve customers anywhere in the store, without leaving them hanging while they root around in the back room. With the simple exchange of an Apple ID you can pay right there and then without even removing your wallet from your pocket. The receipt will land in your inbox before you’re even out of the door.
Point of Sale:
Electronic Point of Sale (EPoS) is fairly standard these days, but there’s an increasing amount of self-serve and automated checkouts, which offer increasingly smarter ways of verifying items being purchased and taking payment quickly and securely.
However—and here comes that ever demanding consumer again—we’re becoming far more impatient. Even having to take the time to enter a 4-digit PIN when contactless payment isn’t available is considered a huge inconvenience these days! Don’t even get me started on the £30 limit!
Here come our friends at Amazon again, opening a store with no checkouts whatsoever! On entering the store, you swipe your smartphone with the “Amazon Go” app then place any items straight into your shopping bag. No need for a trolley or a basket, as you’ll not be unpacking your shopping to pay. Instead, hundreds of ceiling-mounted cameras and electronic sensors identify each customer and track the items they select from the shelves. You just walk straight out when you’re finished. Your debit or credit card is billed as you leave the store and your receipt is emailed to you.
Perhaps there’s no bigger indication of the value of IoT in retail than the biggest online brand opening up a brick and mortar store?
Right now IoT can keep customers engaged in store with targeted offers, loyalty rewards, and tailored recommendations.
How about automatically announcing 20% off all umbrellas right in your shop window whenever it rains? Digital signage can display newly launched products, promotions, and offers that can be automatically updated “over the air” based on numerous external factors—like rain!
Based on the technology deployed by Amazon in their stores without checkouts we can now tell exactly who is our stores, so it’s not entirely inconceivable that there will come a time that we’ll enter a store, or even pass by a shop window, and a digital sign will greet us by name and give an automatic reminder that a loved one’s birthday is fast approaching. It then makes a tailored suggestion for the ideal present based on what the store knows they would like based on their previous purchases, and even what size to buy it in. What a world!
Meanwhile, in-store WiFi is keeping customers connected to the things that are important to them, whilst providing stores with invaluable information about who has visited, and even the floor they were on, what they looked at, and how long they looked at it for.
Here, storage conditions can be closely monitored and automatically adjusted to maximise the shelf life of perishable goods. Stock levels can be automatically linked to customer promotions to limit waste and maximise profit, whilst tracking the sales performance of all items ensures you never run out of your most popular or margin-rich items.
Behind the scenes, IoT is reducing waste and cost through more effective supply chain and stock management, including tracking goods in transit and automatically monitoring sell-by dates.
On the road, items can be tracked to protect against theft, driver behaviour and location kept on tabs, engines diagnosed, routes optimised, incidents recreated, temperature of refrigerated items monitored and automatically adjusted, and fuel protected against theft through a range of telematics, tracking, and IoT sensors.
IoT is also providing ways to keep the supply chain transparent for consumers who prefer to buy local or want to know the environmental impact of their goods with proof of provenance.
So, what are the major considerations for partners wanting to succeed, or indeed be more successful, in retail IoT solutions?
Largely, it’s all about if your existing capability lends itself to the opportunities presented within a particular market sector. You then essentially have three principle options:
- You can develop the capability, which will take time and you may miss the opportunity.
- You can acquire the capability, which can be expensive, risky, and take time to integrate.
- Or you can partner with other organisations in order to collaborate and use the combined strengths of both businesses to create compelling and market-leading solutions.
Here at Pangea we firmly believe in the power of collaborating. In fact, it’s the very thing our business is built on. We operate through a channel of more than 100 resellers and technology partners, meaning our partners our essentially our only customers. As the Channel’s Choice for IoT, our partnerships have been core to us delivering those bespoke, market-leading IoT solutions in retail—because IoT is much more than just connectivity.
Want proof? I just wrote all that without mentioning one specific thing. SIMs! Oops, I just mentioned them…