There’s no escaping the (retail) Internet of Things
The drive to connect is so hot right now that experts predict somewhere in order of 5 billion connected devices on the planet by the end of 2015, exploding to 25 billion by 2020. But it’s not the Things themselves we should be most fascinated with; it’s the massive amounts of data those things generate, and ultimately the personalized experience we can offer once we understand what that data means. For retailers specifically, the Internet of Things holds huge promise. 96% of retailers surveyed by Forrester are preparing to connect devices in order to personalize the shopping experience, improving service through technology:
- Installing beacons and push hyper-relevant promotions to people as they get within range.
- Using RFID to track product movement around the store; when it leaves the shelves, where it goes next, how long it takes to get to the checkout and the friends it picks up on the way.
- Installing smart displays to show different content depending on which RFID or smartphone comes into range (or sends content to it), and measuring which content is more effective based on customer interactions.
- Flicking out notifications directing people who are stuck in queue to the checkout that’s just opened, or inviting them check out an offer rather than waiting.
- Or getting rid of queues entirely; going mobile and letting people check out in the busiest areas of the store (naturally you know where those areas are – you’ve seen the heat map).
At the center of this retail Internet of Things is the customer’s mobile device, the single best source of real-time customer data. Almost everyone now carries a phone with them at all times, giving marketers access to a wealth of information including location, social sharing, in-app activity and more. Combining this live marketing data with on- and offline customer data, information from external services (eg weather, traffic) and other connected devices lets retailers build progressively more sophisticated customer profiles and model shopper intent better than transaction data alone. I may buy a lot of ice cream, but if it’s snowing outside you’re more likely to win me over with an offer for hot chocolate.
All this connectivity means retailers are generating really Big Data, the kind you can't analyze in a spreadsheet. At Plexure's peak the end-to-end marketing platform processes around 8,000 activities a second, amounting to a massive 43GB of customer data per hour. By comparison, Paymark processed 155 payments per second on Christmas Eve 2014; further proof that transaction data is only a small part of the information brands should be collecting on customers. Solutions like Microsoft Power BI analyze this massive stream of events in real-time, allowing for the creation of visual dashboards for easier analysis and immediate action.
Because the real magic comes when you use these insights to predict intent; you know what your customers are going to do at any given time, so you give them what they need when they need it - a cup of coffee instead of an ice-cream on a cold day, or a discounted movie offer instead of a ticket to tonight’s game. The results of this real-time personalization are immediately obvious and very measurable. Brands integrating the Plexure platform into their apps have experienced up to 50% higher spend, 33% more visitors, twice as many store visits per person and a phenomenal 700% increase in offers redeemed.
Originally published in Idealog.