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The Internet of Things is revolutionizing the retail industry, coming in it with the improved shopping experience, automated business processes, enhanced digital marketing, and optimized inventory and supply chain management.

Providing retailers with various advantages, IoT technology also enables them to boost sales and increase customer loyalty. Oracle discovered that when applying RFID tags, retail companies can achieve 99% inventory accuracy, a 50% reduction in out-of-stocks, and a 70% reduction in shrinkage.

 

The global IoT retail market is predicted to grow from $14 billion in 2015 to $36 billion by 2020, at a CAGR of 20%. In its report about the Internet of Things, Verizon found that retailers believe in the IoT potential and have a positive attitude towards adopting IoT in their work:

 

  • 77% of retailers said that IoT solutions help improve the customer experience;
  • 89% of companies said they got the understanding of customer shopping habits, needs, and preferences thanks to using IoT solutions.

 

Promising to innovate and transform the retail industry, IoT solutions are becoming widely introduced for solving a wide range of issues. Here I’ve listed the main use cases describing how IoT is applied by retailers and what benefits they do receive.

 

IoT applications in Retail

 

Beacon alerts & in-store navigation

 

Customer interactions are a key success factor in all business. Through beacons, retailers can easily reach the user audience, increase customer loyalty, and raise profit. Beacons are IoT Bluetooth-enabled devices that use low-energy Bluetooth connections to automatically send push notifications directly to user smartphones once they appear in the operating area.

As beacons are small, they can be attached to almost any place, for instance, walls and counters. In the retail industry, beacons are mainly used for customer in-store navigation, sending push notifications, and collecting customer data.

In connection with mobile applications, retailers can motivate customers to make more purchases by notifying them about discounts and special offerings when they enter the coverage zone, generally near a certain shop. Also, in large shopping centers, beacons are irreplaceable for navigating customer and showing them the best routes to the place they need.

 

Customer data

 

Customer data plays a key role in any business dealing with customers. Retail companies do need to know their audience in order to make them make purchases and increase profit while delivering an amazing personalized experience. Satisfied customers are returning clients.)

IoT solutions suit great for collecting customer data, including the determination of customer buying habits, needs, preferences, favorite routes in the shopping center, and the most popular goods as well.  

By sending all these data to the analytical system, where it’s processed and analyzed, retailers can find out what they should improve. In some cases, for example, it will be better to change the placement of shelves or clothes. Also, with the audience understanding retailers can launch successful marketing campaigns and provide personalization.

 

Personalized shopping experience

 

Traditionally, customer relationships were built on the basis of face-to-face communications. For now, personalized experience takes the center stage and significantly impacts consumer purchasing decisions.

To boost sales and retain customers, retail companies are adopting IoT solutions to deliver the best shopping experience possible. By using beacons, mobile apps, push notifications, and customer analytics, retailers get the ability to understand the needs and preferences of their customers and ensure successful targeting when creating advertising campaigns.

 

Supply chain management

 

Like in many other sectors, supply chain management takes an important part in the retail too. Retailers integrate IoT solutions for load tracking, driver activity monitoring, tracing the delivery process, transportation management, as well as viewing load/driver location in real time. This way, the Internet of Things can enable a transparent supply chain management and help achieve “just-in-time” delivery much easier.

 

Optimized asset management

 

IoT applications are widely used for asset tracking and management. Using RFID tags, mobile apps, and other technologies for inventory tracking, retail companies can accomplish up to 100% inventory accuracy, minimize unexpected out-of-stocks, enable end-to-end store inventory management, and increase sales margins by up to 10% as a result.

What’s more, IoT solutions provide retailers with the ability to track the assortment of goods, analyze product popularity, and check out the information about goods any time they need, including their availability in the store, brand name, price, and description.

 

As you see, there are many useful IoT applications in the retail industry. With the use of additional devices and technologies, improvements in sensors, enhanced connectivity and machine learning tools, retailers automate operations, optimize various processes, reduce costs, and deliver the personalized experience.

 

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Believe it or not, but the possibilities that the Internet of Things, IoT brings to the table are countless. The internet of things, IoT continues to be the next big thing in technology, and now the new phase of the internet of things is pushing everyone hard to ask questions about the data collected by sensors and devices of IoT.  

Undoubtedly, the internet of things, IoT will generate a tsunami of data, with the swift expansion of sensors and devices connected to the IoT. The sheer volume of data being produced by the internet of things will rise exponentially in the upcoming years. This generated data can provide extremely valuable insight to figure out what’s working well and what’s not. Moreover, the internet of things, IoT, will point out the issues that often arise and provide meaningful and actionable insight into new business opportunities and potential risks as correlations and associations are made. 

Examples of IoT Data:  

  • Data that improves productivity of industries through predictive maintenance of equipment and machinery 
  • Data that assists smart cities in predicting crime rates and accidents   
  • Data that creates truly smart living homes with connected devices    
  • Data that provides doctors real-time insight into information from biochips to pacemakers 
  • Data that gives critical communication between self-driven automobiles          

That’s great news, but it’s not possible for humans to monitor, analyze and understand all of this data using traditional methods. Even if they reduce the sample size, it will simply consume too much of their time.  Undoubtedly, finding actionable insights in terabytes of machine data is not a cakewalk, just ask a data scientist. The biggest challenge is to find ways to analyze the deluge of performance data and information that the internet of things, IoT devices creates. The only possible way to keep up with the terabytes of data generated by IoT devices and sensors and gain the hidden insights that it holds is using Artificial Intelligence, commonly known as AI.  

Artificial Intelligence (AI) and IoT    

Artificial intelligence, also known as machine intelligence (MI) is the intelligence that is exhibited by machines or software. John McCarthy, the person who coined this terminology back in 1955, describes it as "the science and engineering of making intelligent machines". In a nutshell, AI is a branch of computer science that emphasizes the creation of an intelligent machine that thinks intelligently, the way intelligent humans think and works and reacts like humans.   

In an IoT environment, Artificial Intelligence (AI) can aid business enterprises take the billions of data points they have and prune them down to what’s really helpful and actionable. The general principle is akin to that in retail applications i.e. review and analyze the data you have collected from different sources to find out similarities or patterns, so that better business decisions can be made.  

To be able to figure out the potential risks or problems, the collected data has to be analyzed in terms of what’s normal and what’s not. Abnormalities, correlations, and similarities need to be identified based on the real-time streams of data generated. The collected data combined with Artificial Intelligence makes life easier with predictive analytics, intelligent automation, and proactive intervention. 

Artificial Intelligence in IoT Applications  

  • New sensors will enable computers and smart devices to “hear,” gather sonic information about the user’s ambience   
  • Visual big data will allow computers and smart devices to gain a deeper insight of images on the screen, with the new AI app that understands the context of images

These are some of the promising applications of Artificial Intelligence in the internet of things, IoT ecosystem. The potential for highly personalized services are countless and will dramatically change the way people live. For example, Amazon.com can suggest what other books and movies you may like, helping Saavn and Gaana to determine what other songs you may love listening, and your family doctor would receive notification if you’re not feeling comfortable.  

Here Are Some Challenges Facing AI in IoT

  • Artificial Stupidity
  • Complexity
  • Safety
  • Ethical and legal Issues
  • Compatibility
  • Privacy/Security 

What’s Next? 

Gartner has predicted that by the end of next year, 6 billion connected devices will be requesting support, which means that processes, technologies, and strategies will have to be in place to respond to them. It is important to think of connected devices less as ‘things’, but more as customers or consumers of services in themselves. The need for Artificial intelligence, AI will become more prominent at the stage when the number of connected devices and sensors increase manifold.

Hope you find this post helpful. If you did, share it with your friends and colleagues. For AI and IoT Courses Online, you can do some research on Google to find the best institute that suits your needs and budget.

For any query related to this post, you can comment down below. Thanks for your time. 

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