IoT and the ethical, interactive British high street
How can the IoT help small retailers to compete more effectively with bigger competitors?
Much of IoT use for retail applications centres on location and tracking. Higher value items such as clothes or electrical goods can be individually tagged so the shop assistant knows immediately where the product is located, cutting customer waiting times and reducing losses from theft. Customers’ actions can also be tracked by technologies such as: RFID, Wi-Fi, GPS, beacons and cameras. Over time, this will give the retailer invaluable data about customers’ shopping habits, as well as identifying how shoppers move through the store so the layout can be improved. Furthermore, a mobile app allows the retailer to tailor special offers to loyal shoppers based on their purchase history and can also direct shoppers to items of interest.
For Brighton-based supermarket group hiSbe profits, unusually, are not everything. The company runs on a social enterprise model that aims to put happiness, fairness, responsibility and sustainable trading before financial gain. As part of this mission, hiSbe needed to be able to back up its good intentions with hard data. This is easier said than done, but with the help of technology from Provenance it was able to demonstrate its ethical supply chain and provide detailed information about its products, such as what portion of the cost of a pint of milk goes to the dairy farmer.
This is just one way in which the Internet of Things (IoT) can transform small retailers’ operations, while also levelling the playing field against much larger competitors. IoT in retail applications encompasses a range of technologies and use cases, but fundamentally it’s all about connections: using technology to connect people, products and places.
Another major theme is the interaction between the customer and technology, saving staff time and giving customers more options and control over their shopping. This is particularly relevant in fashion retailing, where smart screens on the shop floor or interactive mirrors in fitting rooms can display information about particular items, indicate if the required size is in stock or suggest other items to complete an outfit. Interactive mirrors enable the customer to change the lighting to reflect where the outfit will be worn, and to see themselves in a different colour option or request a different size or style, all at the touch of a finger.
A retail IoT deployment can be small in scale and need not cost the earth. Cameras or sensors are relatively inexpensive, and more sophisticated equipment like interactive mirrors will come down in price as their popularity grows. There may also be opportunities to work with IoT retail developers which might welcome a trial partner able to provide valuable feedback. And there is no need for specialist staff on site: a standard solution or app plus software-as-a-service to analyse the data and feed it back in an easily digestible format will be enough.
While the central goal of an IoT retail deployment might be to drive more sales, retailers shouldn’t lose sight of the bigger picture. Giving customers an innovative new shopping experience might not immediately lead to higher sales, but the value of the data that they can accumulate should not be underestimated. Over time a more personal and exciting shopping experience can build customer loyalty and trigger higher spending.
The challenge is to pick the right product for your particular retail outlet and make sure it is fit for purpose, while also considering customers’ needs and expectations. Taking time to get it right is infinitely preferable to being the first to deploy an untested solution that may put customers off if it does not deliver a great user experience. Indeed, as the hiSbe case would surely attest, keeping customers happy is what it’s all about.
Retail IoT is still very much in the early stages and there are huge opportunities for UK SME tech developers to tap into a market with considerable potential that can help revitalise our high streets. Retail IoT is a particular area of focus for Brighton Digital Catapult, which has already held Retail Innovation Pit Stops and plans more to bring together independent retailers, larger chains, technology developers and academia who can collaborate to drive relevant use cases and successful deployments.
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