Is IoT technology transforming brick and mortar retail?
ONLINE commerce has been booming in recent years, with eMarketer forecasting a total US$1.365 trillion in retail ecommerce sales in the Asia-Pacific, up 29.6 percent from 2016. With the proliferation of online sales, many have speculated whether brick and mortar retail is on its death bed.
However, while it may seem as if e-commerce is taking over, according to TimeTrade research 85 percent of consumers report a preference for shopping in physical stores. For many, there are many features about brick and mortar that simply cannot be replaced by the offer of free returns and a discounted next day delivery.
The thrill of an impulse buy, the sensory experience of being able to see, touch and smell products, and the ability to ask a store assistant for advice lead many consumers to continue to shop in-store.
Even Amazon, the largest online retailer in the world, has opened brick and mortar stores around the globe. In fact, if given the opportunity, 71 percent of consumers said they would prefer to shop at an Amazon store over shopping on the online website.
Despite the continuing popularity of physical retail stores, in order to keep up with the ever-growing e-commerce industry, it is clear retailers need to embrace technology with both arms.
For retailers, The Internet of Things (IoT) is perhaps one of the biggest opportunities of the digital era. IoT enables retailers to combine the best of the physical store with operations to rival any online retailer.
There is a vast opportunity for physical retailers who can bring the level of customer experience found online into brick and mortar stores. Imagine personalized recommendations, fast checkouts, mobile payments and virtual coupons.
Many startups have made this omnichannel retail vision a reality, with Nucleus being one of them. The idea behind Nucleus’s IoT solutions was to eliminate the inefficiencies within brick and mortar retail.
“With Nucleus, we can create a better world by providing personalized experiences to end users while ensuring privacy,” Abhishek Pitti, CEO of Nucleus, told Tech Wire Asia.
Nucleus’s IoT solution captures and provides previously inaccessible data to brick and mortar businesses through blockchain and sensor technology. With this data, the Nucleus platform mines intelligence, helping businesses provide customized experiences to their customers.
The aim of Nucleus is to ensure next-level personalization for customers. “With Nucleus, every shopper is made to feel special when they walk into a retail store,” said Pitti.
For retailers, Nucleus is a powerful solution. The “e-commerce-esque” personalization can result in better targeting and higher relevance in regard to promotional activities.
According to Pitti: “[Retailers] simply connect the ION (IoT) sensor and they become part of the Nucleus ecosystem. With the Nucleus ecosystem, they gain access to a vast and secure data exchange system that gives them critical insights about walk-in customers.
“With this data, Nucleus helps retailers to incentivize walk-ins in the store, increase in-store conversions, grow average customer basket size, and, most importantly, earn customer loyalty.”
However, with this personalization comes the question of customer data privacy and security. Fortunately, Nucleus utilizes blockchain technology to address this issue, allowing the customer to have complete control over how their data is managed and shared.
“Each request to access a customer’s data on the blockchain will triger a notification to the customer, prompting them to authorize the transfer. Furthermore, retailers will have to pay users for their data, instead of networks with mass data. This not only ensures higher data integrity but also helps retailers pick and choose specific data points.”
Not only does the retailer need customer authorization in order to obtain their data, they also need to pay the customer nCash tokens – the cryptocurrency of Nucleus – as a data acquisition cost.
These micropayments will be made in real-time on the blockchain to the customer’s Nucleus wallet, which can later be used as reward points in any Nucleus retail store. The same can also be exchanged for real currencies across the world.
According to Pitti, Nucleus has received a great response from the retail industries so far.
“We are already live in 10 stores in India, with 19 of our proprietary sensors installed between them. Over 33,000 walk-ins have been identified, with an authorization rate of more than 10 percent among customers. These customers were sent around 2,000 offers, and of those offers, 75 percent were redeemed. This signifies success for us; these numbers more than validate the potential of Nucleus in retail,” he told Tech Wire Asia.
- Here’s why IoT will help revolutionize commercial fleet management
- Here’s how virtual reality can help train doctors and medical students
- Businesses need to understand and preach digital discipline
- Digital transformation 2.0: Are companies going digital more effortlessly?
- Can cloud technology help improve phone and video calls?