How does the Internet of Things fit into your retail customer experience?
As IoT technology such as beacons are becoming more prevalent in the retail industry, it is more important than ever they become a key part of your customer experience. A recent study found that 70% of retailers are planning IoT investments by 2021.
IoT has the potential to improve every aspect of retail from ecommerce to the supply chain. However, as with the retail apocalypse looming over many smaller shops and chains competing with larger, multichannel retailers, the most impactful opportunities will be in enhancing the customer experience. This is the area that will help you differentiate your company from competitors and offer an experience – both in-store and online – that can compete with the big names.
As you build out your IoT strategy over the next few years, make sure customer experience is a top priority. Here are some IoT services you should leverage to enhance your retail customer experiences:
One of the most popular retail use cases for the Internet of Things is location-based marketing, with 70% of retailers reporting plans to use beacons for this purpose. These small devices that can send alerts based on location proximity are ideal for sending customers information about discounts, events, requests for feedback or other marketing messaging.
Macy’s is one retailer that understands thriving in the new retail landscape requires optimizing how they are marketing to customers in-store rather than how they drive customers to their locations. They deployed beacons across all their locations in 2014 to send shoppers notifications, promotions and other discounts. This year they showed sales growth for consecutive quarters as many others struggle.
Not only can beacon technology be used in-store, this location data is also extremely valuable for retargeting campaigns. Sending customers targeted messages after a visit can improve their experience and increase retention.
A survey of retailers with IoT services found the most common ways beacons and IoT technology are used to provide location-based services include:
- Customizing the store visit (79%)
- Knowing when specific customers are in the store (75%)
- Real-time alerts deploying employees to a location in-store to assist shoppers (75%)
- Knowing where specific customers are in the store (74%)
- Real-time alerts when loyal customer walks in the door (74%)
- Real-time alerts when a customer is in the parking lot to pick up an online order (71%)
The key to taking the biggest advantage of these insights is the ability to track and process them in real-time. Knowing where and when a customer enters the store is invaluable to tailoring their entire experience. This is especially useful when offering in-store pickup and other services that combine your in-store and eCommerce experience.
While real-time analytics from beacons and other IoT devices can help improve customer experiences as they are having them, IoT services also offer opportunities to make long-term, wide-ranging improvements to the store experience.
A few ways retailers plan to use IoT for in-store optimization include:
- Optimizing Store Layout: By 2021, 71% of retailers plan to invest in sensors for tracking customer footpaths. This data can help identify common shopping trends and optimize the store layout for the customer experience and to increase sales.
- Checkout Process Efficiency: Automated checkouts, employees equipped with tablets for streamlined purchased and other more efficient checkout processes are all ways retailers are using IoT to save money and speed up the time it takes customers to checkout.
- Digitized Customer Experience: On the whole, IoT offers the opportunity to give customers an online shopping experience, in-store. Using robot employees, customized digital signage and mobile apps optimized for the store experience are all ways to provide the convenience and self-service of online shopping to in-store customers.
Supply Chain Optimization
Another area that IoT is heavily impacting is the supply chain. While supply chain optimization may not seem as directly related to the customer experience as the above points, it actually holds a great deal of potential in retail. In fact, 58% of supply chain executives agree IoT is integral for improving service levels.
The use of IoT devices like RFID, GPS sensors, smart shelves, temperature sensors and other technology can give you much more precise insights into your supply chain. This data can be used to speed up product delivery, ensure you are never out of stock and accurately keep track of how your product is handled to ensure the highest quality.
Retailers face serious challenges improving the customer experience to compete in today’s retail landscape. Luckily, IoT services offer a number of opportunities to better track and analyze customer data to create a customer experience that truly gives you an advantage.