How can IoT & location services improve customer experience in retail?

Two of the most important and impactful changes in the retail landscape across the past twenty years have been the introduction of IoT-adjacent technologies, and the increased emphasis upon customer experience. The technological change is self-explanatory - we now have access to devices and information that simply weren’t available in the past.

The philosophical shift towards a more customer-oriented experience has been a result of greater understanding that the role customer experience plays in a retail business’s bottom line. In the past, there was a tendency to overemphasize basic market forces - supply, demand, and price points - at the cost of everything else. Nowadays, retailers are embracing the fact that offering an outstanding customer experience is a potent weapon in their arsenal for achieving growth and greater revenues. Providing customers with an excellent retail experience leads to repeat business, enhanced word of mouth, and customers who are more inclined to browse for longer and spend more in store.

Here are some key ways in which IoT-adjacent technologies and initiatives have improved retail customer experience.

Enhanced omnichannel integration via in-app Store Modes

While eCommerce continues to grow and expand, it is too often described as being in direct competition with brick and mortar retail. What IoT devices such as beacons, plus the omnipresence of app-enabled smartphones, have made possible is omnichannel retail, enabling physical and digital retail environments to coexist and cooperate, rather than compete. 

An in-app Store Mode (where a typical online retail app offers users in-store features) can encompass everything from indoor mapping and navigation to product locators, all of which we cover in more detail below. If you’re interested in learning more about Store Mode, how it works, its benefits and how a Store Mode can be implemented, we’ve compiled the ultimate guide to all you need to know about Store Mode

A Store Mode enhances the retail experience for customers by bringing the digital and physical shopping experiences into closer alignment. Customers that are researching products online before arriving at the store to buy it, for example, can be given information about stock levels and product location, to avoid them making a wasted trip if a product is out of stock. Research suggests that consumers who use their phones in-store on a retail app generally spend 40% more than those who don't.

Creating a feedback loop via analytical insights

Using IoT-enabled devices and combining them with an analytics platform can unlock invaluable insights that otherwise would have been missed. It is often assumed that analytics are only intended to help retailers maximize their revenue, but they can deliver important insights into how customers are interacting with a retail store and its products.

For example, analytical heatmaps could reveal which areas of a store are oversubscribed, and which are underutilized, enabling a retailer to better space their high interest areas out and help ensure a more even, less concentrated spread of visitors across the store. Analysis of user journey data and purchases could reveal which products are frequently bought or searched for together, and should therefore be located near one another.

While both of these examples, if actioned, could lead to increased revenues, they’d do so in a way that also greatly enhanced customer experience.

Learn how retailers are delivering world class experiences for their customers with Pointr's guide to Store Mode.

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Indoor navigation and product locator systems

We’ve covered both in-store navigation and product locator systems elsewhere extensively, and their benefits to customer experience are obvious. 

Modern life has taught consumers to expect not only precise mapping services to be available at the touch of a button, but those mapping services to have pinpoint navigation features with a smorgasbord of waypoint and routing options. Though consumers don’t quite expect the same from indoor environments yet, the technology exists to provide a stellar navigation experience right now, including offering users the ability to ‘map their list’. By adding items to a shopping list, the navigation system can automatically work out the most efficient route through the store for the user to collect all the items on the list.

Greater personalization

As stated above, one of the core aims for improving the customer experience is to encourage repeat visits - a customer is more likely to return to a store that they’ve had repeated positive experiences in. One way in which such repeat behavior can be rewarded is via greater personalization.

This could take a number of forms, many of which tie into the section on Store Mode above. The purchase history of a user could be used to alert them to when their local store has a sale on that item (or complementary items), or the app could offer to populate their in-store shopping list based on past purchases. 

Rather than focusing on untargeted upselling that customers can find off-putting, using personalized, targeted product recommendations and alerts, tied in with IoT innovations such as geofences (to alert customers when they’re close to a particular item) can help grow basket values while also delivering a helpful service to customers.