The Internet of Things, in which the physical world is connected with the digital, is quickly taking shape. Industry heavyweights like Google (with Google Glass) and Apple (with iBeacon) have embraced the technology, which will no doubt help to accelerate its growth.
Although today there are already more things connected to the Internet than people, we are only just beginning to see the impact of a world of connected devices. According to
McKinsey, the Internet of Things could have a potential annual economic impact of up to $US6 trillion by the year 2025.
Today, sensors — the glue that connects the Internet of Things — are being used to significantly enhance and improve our daily lives, creating previously unimaginable benefits by connecting the things around us in new and powerful ways: wristbands that track the steps we take and the calories we burn, refrigerators that send us texts when we are out of milk, thermostats that learn how hot or cold we like our home and automatically adjust temperatures, even teddy bears that track a baby’s heart rate and oxygen levels.
Mary Meeker’s latest Internet Trends report predicts sensor-enabled wearable computers will be the next major computing wave and some of the world’s largest brands are leading the charge. Google Glass uses sensors to detect ambient light, proximity and movement. Disney is using sensors in their digital wristbands that serve as a visitor’s ticket, payment mechanism and room key. The Nike+ Fuel Band is a wearable computer that tracks a user’s daily activity and reports their fitness level. These devices represent just a few of the many examples of how data collected by sensors is being used to make our lives better.
Sensors are now making their way into the retail shopping environment. Pioneering retailers like Kenneth Cole, Alex and Ani and Timberland are using sensors to trigger the delivery of personalised offers and content to consumers’ smartphones the moment they walk into a store. Because sensors can verify a person’s location with much more precision than traditional mobile phone GPS, retailers can tailor their messages based on where the shopper is — whether it’s walking on the sidewalk outside of the store, entering the store, or browsing at a particular location inside the store. Thanks to the extremely high relevance of micro-location based content and offers, retailers have seen mobile in-store offer open rates of over 70 per cent and purchase conversion rates in excess of 30 per cent. Testimony from real-world shoppers highlights the allure: “Entering the store and having the content and offers automatically delivered to my phone made it feel like a unique shopping experience designed just for me.”
With over 90 per cent of purchases still taking place in physical stores and two-thirds of smartphone owners using their devices to help them shop while in a store, the impact of sensors on retail shopping will be significant. Using sensors to trigger value-added mobile experiences or highly personalised services could fundamentally transform the retail shopping experience. Going far beyond convenience, these sensors will make us smarter consumers and enable retailers to provide mass customised and highly contextual experiences tailored to the individual tastes and preferences of each of us.
In just a few years, sensors will be so pervasive that it will be hard to imagine a world without them. Data that used to take months and years to collect will be accessible in real-time — allowing us to make more informed decisions about everything from what we should eat to what we should buy. We already know that consumers prefer to shop in store. If we can use sensors to add the convenience and personalisation that we love when we shop online, imagine how much better the in-store experience will be. With the critical shopping season just a few months away, savvy retailers already have sensors on their holiday wish lists.
Hilmi Ozguc is the CEO of Swirl, an in-store mobile marketing platform provider.
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