Technology is reshaping our tried and true ways of doing things and making our various processes faster and more efficient. It is becoming more and more apparent in virtually every industry and aspect of our daily lives. The Internet of Things especially makes a significant impact, as its inter-connected devices and machines provide a deep understanding of everything that is going on around them.
In retail, this knowledge is especially valuable since this industry relies on data and rich analysis to serve customers more efficiently. But owing to the sensitivity of information used in retail to provide better service, the security of the connected retail environment can’t be overlooked. As in every other industry, the use of the Internet of Things carries its risks. Let’s have a closer look at how IoT is used in retail to understand better where the security challenges prevail.
Rich Customer Analysis
The customer is the central focus of retail, and their satisfaction is how success is measured. As such, it’s no wonder that the use of IoT in retail revolves around improving the customer experience by utilizing data. Rich customer analysis allows you to:
- Gain complete insight into customers and their households and networks by using point of sale data and leveraging it along with mobile and social media data;
- Create better, more targeted marketing campaigns that improve effectiveness and sales;
- Improve customer service and differentiation through better insight into customer purchase patterns and preferences.
Inventory Tracking and Demand Analysis
Another essential part of retail and IoT has to do with tracking inventory and analyzing the demand. These two aspects are crucial for the effective management of a retail business, as it’s best not to have too much or too little inventory. It’s also always a priority to meet the customer demand, which is why there is such emphasis on gathering and analyzing data. IoT in retail can therefore also help to:
- Improve demand management through near real-time analysis of all the critical data that impacts inventory and demand (point of sale data, weather data, sensor data from merchandise and supply chain, etc.);
- Enhance the efficiency of your supply chain by achieving operational effectiveness;
- Improve merchandise positioning both online and in stores;
- Get better financial forecasting by using improved pricing strategies through better customer segmentation and elasticity of demand.
Secure and Effective Operations
Of course, none of these benefits of IoT would mean much unless they were also capable of speeding up the local processes and keeping operations smooth and active. The fast pace of living demands it, and customers who have to wait for long to get what they need will go elsewhere. However, with the analysis of data from stores and facility-based sensors, it’s possible to keep the customer experience positive, as it reduces preventive maintenance wait times.
Ensuring IoT security in retail is no easy task. However, it’s paramount for the industry as it aims to improve the customer experience all around. Without being able to guarantee an acceptable level of security, that will be difficult to accomplish. It is why IoT manufacturers and developers have to come up with high standards to improve the effectiveness of IoT security and objectively measure it.