How IoT Will Change the Retail Industry

  • 24 November 2017
  • Shawn Farner

The Internet of Things concept has been growing in popularity for several years now, and in no place is that more apparent than in the world of home automation. You can now purchase Internet-connected switches to turn your lights on and off, remotely start your coffee maker, and even alert you to someone at your front door before they ring the doorbell.

With this new sector of technology taking hold in the consumer world, it was only a matter of time before the tech started to make headway in the retail space. There is a host of ways IoT is being used already among retail companies and plenty of potential uses for this technology in the future. Below, we’ve detailed some of the ways the Internet of Things will introduce change to the retail industry.



Can you believe there was a day you’d order something — probably through a catalog — and have no idea where your package was or what day it would arrive? We’re long past those days now, and with each step up technology has taken, the ability to start and keep products moving from point A to point B has only improved. Internet-connected systems now scan packages at each point of entry and exit, automatically updating logistics systems and sending text messages to consumers with updated location information and arrival time. And this process is not only used for packages, but also for warehouse inventory and other means used by retailers to keep track of goods, ensuring retailers always have a way to account for their assets and keep their costs to a minimum.

Understanding Shopper Behavior


We’ve already seen things like beacons in stores, giving retailers a sense of how many people are shopping at one time. Devices like these will only get smarter once the technology gets further along and the Internet becomes involved. Tracking devices will be able to identify a shopper inside the store and track their path around the space, noting where they stop and which products are located in that particular section. This not only helps retailers understand the demographics drawn to certain parts of the store, it also gives a store information on how to better lay out the space and make it easier for consumers to shop.

In-Store Personalization

Luca Bertolli/123RF

The retail store experience is going to change in a big way thanks to the Internet of Things. Those scenes from Minority Report aren’t as far off as we think, as retailers are already looking at ways to personally greet customers upon entry and make recommendations to them based on their past purchases. When you consider that some retail locations also have fairly sizable online stores, and these new forms of interaction will be Internet-connected, a shopper’s online browsing history could also come into play, giving retailers an opportunity to present them with something they’ve looked at online in the past, upping the chance a consumer will make an impulse purchase (which, frankly, is easier to when an item is right in front of you).

New Shopping Experiences


The dressing room will likely get a big upgrade in the next phase of IoT. With consumers now carrying smartphones pretty much everywhere they go, a quick sync of the retailer’s app to a Smart Mirror device could give a shopper a way to “try” clothing on without ever having to take it off the rack. This will speed up the shopping process for everyone involved and give the consumer a better chance at finding something they like. And if someone can find something that suits them in a more efficient fashion, they’ll be more likely to make a purchase. Don’t be surprised to see something like this in clothing stores sometime very soon.

Instant Purchases


Amazon is doing very interesting things when it comes to the Internet of Things space. Take the company’s Dash Buttons, for example: small, Internet-connected buttons tied to a particular product and designed to be attached where a product sits. You can attach a Downy Dash Button to your dryer, for example, and push it when you’re running low on dryer sheets. By the time you’re out, you’ll have a new box sitting on your doorstep. The company’s Dash Wand is another innovation: a way for grocery shoppers to scan the items they have around the house and have them quickly added to an online Amazon shopping list. These initiatives are going to catch on big with other retailers as they all place more of an emphasis on Internet purchases in the future.

Ecosystem Possibilities


As many companies have discovered, offering the benefits of an Internet-connected world can be fruitful if you can convince consumers that you’re offering the best sandbox to play in. Amazon is doing it with Prime and all of its Internet services. Apple is doing it with iOS, OS X and its other products. And retailers will catch on, too, understanding that, in order to keep consumers engaged with their brand and their products, they’ll need to offer an entire ecosystem of goods and services that are all interconnected. Don’t be too surprised to see some retailers branch out and begin doing some new — sometimes out of their wheelhouse — things in the future in order to create ecosystems for their customers based around the Internet of Things.

As you can see, there are already some retailers using the Internet of Things to further their business goals. But there are plenty of others who have yet to make the jump, and fortunately, there’s a long runway in terms of how this sector of the tech space will be used in retail going forward. We’ve not yet seen some of the best and most innovative uses of IoT yet — they’re still to come. And retailers will undoubtedly be ready to jump on board once they identify a way to use IoT to benefit both their businesses and their customers.

Can you think of any other ways IoT will change the retail industry in the future? Sound off below — we’d love to hear about them!

About Shawn Farner