Retail IoT connections will rise 350 per cent by 2021 according to new data from Juniper Research.
The UK-based company predicts retailers will connect 12.5 billion business assets to IoT platforms by then, ranging from products to digital signs and Bluetooth beacons.
That compares with an estimated 2.7 billion connections in 2016.
Juniper also predicts that RFID (radio-frequency identification), will re-emerge as the industry’s ‘killer app’ becoming the key factor in the IoT retail ecosystem.
“RFID tags, used to identify and locate retail assets in real-time, are now at a low enough price point for mass deployment and integrate well with new IoT systems and analytics,” Junpier said in its research paper IoT in Retail: Strategies for Customer Experience, Engagement & Optimisation 2017-2021.
“New services, such as dynamic pricing or enabling promotional offers via in-store digital signs are also poised for growth.”
The company says ‘next-gen’ processes, such as personalised retail, could be achieved by integrating enterprise software and emerging technologies, with data from connected IoT assets. Juniper forecast that software spend for enterprise resource planning systems to integrate this data would reach US$11.3 billion annually in 2021, from $1.5 billion in 2017.
“Innovative retailers such as Rebecca Minkoff have combined RFID with smart mirrors,” said research author Steffen Sorrell. “Integrating these systems allows real-time information to improve the store experience and bridge physical and virtual worlds – in this case, the concept drove a 200 per cent increase in sales.”
Aiming for the Endgame
Juniper predicts that each retailer’s approach to the IoT should differ depending on their main channel focus. It argues that physical retail spaces still have many benefits, not least in terms of being able to avoid the sterility of online shopping.
“Therefore, Juniper predicts that online retailers’ focus would be on technologies such as machine learning to provide digital assistance, or digital performance management. In this latter instance, measurements such as user experience, IT performance and business outcome are analysed holistically to determine necessary improvements.”