The internet of things (IoT) has been growing steadily, with connected home devices invading our living rooms, internet-ready wearables adorning our wrists, and myriad other devices feeding constant streams of data to unseen servers in faraway places. If you look at the amount of people using voice-search technology from in-home devices like Amazon Echo and Google Home, there’s no denying that the IoT is, at the very least, the future of search. ComScore reports that 40 percent of American adults already use voice search in their everyday lives, and estimates that 50 percent of all queries will be voice searches by 2020.

Retail outlets have absolutely noticed the potential that IoT and automation have in their industries. In fact, Verizon released a recent report showing the potential of IoT in retail:

  • 77 percent of retailers believe that IoT solutions help improve customer experience.
  • 89 percent of early-movers in retail report that IoT enables businesses to gain increased insights into customer preferences.
  • 77 percent of early-movers in retail say that IoT technology helps them better cooperate with partners in delivering quality products and services to customers.

As the IoT and automation continue to alter the retail landscape, it’s essential that managers stay on top trends in the industry. Here are three ways retail sales will be transformed by the IoT and automation:

  1. Altering the In-Store Experience With Mobile

Brick-and-mortar retailers are having a hard time competing with online shopping places — but automation and the IoT are set to change that. Imagine that, for example, your store offered an app that allowed shoppers to scan a barcode with their mobile devices, and then directed them to similar products on your website.

Just as innovative would be an augmented reality experience that allows customers to “try on” clothing or products by holding their phone up in a mirror, and wearing a “virtual” version of the clothing. This is essentially the same technology that made Pokemon Go so popular.


  1. Radio Frequency Identification (RFID) Chips and Bluetooth Beacons

RFID chips are now being used to look at item tracking and obtain extremely fast real-time analytics. The way this is done is by tagging each item on the product floor with an RFID chip, and then using devices to track and interpret data related to them. This might include purchasing data, how popular an item is, how a shopper moves across the store, and even how long they hesitate per product, or how long they take to actually purchase an item once it’s off the shelf.

This is being called a “smart shelf” solution, and it’s revolutionizing the supply chain by helping to avoid oversupply, goods shortages, and even thefts. Loss prevention can be alerted to items leaving the store without purchase in real time.

Much like RFID chips, stores are also using Bluetooth-powered beacons located around the store — though these beacons are more for interacting with customers than simply tracking them. When used in conjunction with mobile apps, they are able to send push messages that help customers navigate the store, show coupons they could use, and ultimately increase customer loyalty.

Technology like chips and beacons, especially when combined with AI and AR, make excellent fodder for gamification as well, much like Nike’s Nike+ ecosystem.

“A social element was also available in their apps, where users could share their recent activity on social media, and challenge them there or in the app’s built in ‘friends’ interface which also serves as a way to encourage friendly competition,” writes Appnovation developer, Makan.

Tying together these systems with an app could help to create a similar social ecosystem and build up customer retention as well as brand recognition.

  1. Finding and Bridging Information Gaps

The Copper Project team lists “Finding Information Gaps” as the number two way that AI is shaping the future of business.

“AI can also help in finding the information gaps. It allows managers to interpret data that has been through different software sources,” they write. “The AI system can identify the gap and provides a solution to fulfill the gap.”

These information gaps will advise future retail strategies and could lead to substantial optimization in your business operations. For example, consistently calculating the economics of delivery can radically change your supply chain and save you on your bottom line.

Of course, it’s imperative that you make sure you’re bridging these gaps in the correct way, as well as making sure that the gaps you’re identifying are worth investing in patching up. Sometimes correlation and causation are confused with one another, so be prepared to test out multiple strategies based on your insights.

This is a great rule of thumb for all things related to the IoT and automation — both are extremely new technologies. The bad news is that we haven’t worked out all the kinks and all the ways that a new digital paradigm can benefit retail. The good news is that we are working on it, and the future looks bright.