4 Ways IoT Analytics is Changing Retail

4 pieces that show how IoT Analytics is changing retail

We noted the accelerating adoption of IoT analytics for the likes of McDonald’s, Chick fil-A and others in our last blog post. With the wide variety of use cases becoming clearer to retailers, we can already see the shift in how people are doing business.

Running a profitable retailer – whether it be food, clothes, or any other consumer commodities – is often an exercise in complex optimization – stretching from the sources thru the supply chain and all the way to point of purchase.

Having the right products at the right place, at the right time seems like a no-brainer. But how do you make that happen?
Here are 4 ways IoT Analytics is changing retail. How many of these have you put into play?

1. Instant Personalized Promotions and 1/1 Marketing

 

Wouldn’t it be great to be able to deliver a flash promotion to customers near-by? With IoT analytics, retailers are now able to deliver personalized 1 to 1 marketing via mobile device with the use of location-based applications.

It seems like an obvious example, but it still one of the most popular. The in-store promotion on a mobile device to a prospect or customer when they are physically near or in front of products appropriate for them can have great success. These promotional offers often utilize the customer’s purchase history or general demographic profiles.

 

2. Demand Shaping and Inventory Management

 

The art of demand shaping and inventory management have seen huge changes with the addition of IoT Analytics. Demand shaping is the science of offering consumers the products that are most profitable to the retailer. It goes way beyond the traditional idea of eliminating overstock.

When a retailer has an inventory imbalance, they can always fall back on the traditional techniques of sales and markdowns. But these “blunt instrument” approaches come at a cost, often by dramatically lowering a retailer’s margins.

Why not entice your customers to purchase something more by offering a bundle deal?

By leveraging IoT Analytics, retailers can implement surgical techniques that isolate specific customers in specific circumstances with situational offers in real-time. By instantly using customer preference, history and location IoT analytics can create situational offers targeted at that specific consumer.

By offering to discount the item in excess as part of a bundle deal, the retailer can encourage the customer to purchase it alongside the other full-price items. The customer receives a personalized experience and the retailer improves their overall margins.

 

3. Salesperson and Personnel Management

 

The margins in retail aren’t just from sales. Labor is one of the primary costs for retailers.

This includes not only direct ‘on the floor’ salespeople, but also service personnel who maintain key store equipment and delivery personnel who keep inventory levels on target.

For example, key equipment can include a wide variety of food processing/preparation equipment, checkout registers, and more. Ensuring that all this equipment is running properly and staffed appropriately requires a high degree of coordination. The status of the machines, the availablity of relevant staff trained on its use, and the complexity of enterprise workflows all must be taken into account.

IoT Analytics can process the data from all these sources to optimize personnel planning, prevent equipment problems that would impact customers or sales, and increase operational efficiency.

 

4. Food Safety, Quality and Cold Chain Management

 

IoT Analytics is also very useful – and often essential – to the food safety and quality requirement for retailers with food and beverage offerings. Maintaining temperature for food and beverages is important not only for general quality and inventory preservation reasons, but also for government, legal or regulatory reasons as well.

Furthermore, food safety problems can quickly escalate to be PR and revenue issues, as we have seen in the recent news in the quick serve restaurant industry.

IoT Analytics can help by embedding sensors at each point in the cold chain and providing pre-emptive warnings to avoid food quality issues BEFORE they occur and affect customers. Managing cold chain effectively is, in fact, one of the “hottest” topics for IoT Analytics in the food processing industry.

 

Retail taken to the next level with IoT Analytics

 

We only touched on 4 examples of how IoT Analytics is changing Retail environments. There are many more. Nevertheless, even looking at these few examples we can see a common thread – IoT Analytics.

In retail, it is clear that ensuring the best possible customer experience is the ultimate goal. But to accomplish that you need to have the right products and services at the right place, at the right time, all the time. It’s this consistency through all channels that enables the retailer to give a tailored experience to delight their customers.

Today’s competitive retail environment requires an unprecedented level of customer experience and operational optimization. The traditional role of analytics and narrow optimizations are no longer sufficient to compete in this new environment. IoT and Analytics together are the key for retailers to raise their game and deliver customer experiences that keep their customers coming back for more.

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