How Retailers Can Establish an IoT-Based Smart Building Strategy
The Internet of Things is very complex, but with the right team and the right implementation process in place, companies can establish effective IoT processes.
March 20, 2022Ed. Note: This article was previously published on Retail Touch Points.
The growing dominance of e-commerce and the growing prevalence of disruptive technologies has accelerated the digital transformation of physical retail. As the retail industry evolves, so do customer expectations. Retailers face a multi-faceted challenge to meet customer experience standards while tackling growing competition, skyrocketing location costs, hiring challenges, advanced technologies and the growing need to provide sustainable solutions.
For most retailers, this situation looks like multi-pronged battles. The most overwhelming part of the battle is prioritizing where to put the maximum energy and resources to achieve greater ROI and long-term sustainability, while constantly improving the quality of the experiences they deliver. How can this be done? Creating a smart building strategy based on the Internet of Things (IoT) can enable retailers to achieve these goals.
Create a plan
A Forrester study published in 2020 found that 26% of retail businesses were already using or considering IoT solutions in the United States in 2019, and that number continues to grow. Retailers must have a clear vision and end goals. There is no single formula for building a long-term strategy.
This plan should ideally answer three simple questions: what problem do you want your IoT implementation to solve, what would you get when the problem is solved, and what is the best possible solution? The right IoT implementation plan visualizes a long-term roadmap for the retailer. Over the years, the amount of data will increase; therefore, assessing the scalability and modularity of the potential solution is critical.
Accurately assess your investments
In a Beecham report exploring the experience of successful IoT implementations, having sufficient financial resources received the highest overall score, with 76% of companies calling it very important. Among the companies that called their project a failure, 67% agreed that having sufficient resources was the biggest improvement required by their strategy.
Securing the long-term investments necessary for successful implementation is key to a winning IoT strategy. However, that doesn’t mean retailers who didn’t do costing didn’t have a vision. What are the key considerations when evaluating your IoT project investments?
Material costs: When adopting IoT technology, certain devices will be integrated as part of your solution. Hardware includes sensors, devices used to provide data on factors such as light intensity, humidity, temperature, etc.
IoT tools: An IoT tool is a device that collects, processes and exchanges sensor data over the Internet. It can control sensor data via commands on the Internet and perform one or more sets of tasks.
Software or platform costs: An IoT platform is the central aspect of the solution framework. This is the centralized software network that can be used to monitor and control connected devices. It includes a custom set of commands to collect, integrate, and process data to achieve a specific goal.
Build a prototype and run a pilot
Having the right technical resources is a key measure of the success of an IoT implementation. Since IoT involves different systems interacting with each other, it makes sense for retailers to involve various internal departments in planning. Prototyping involves creating an instance of the network using readily available and less robust systems to assess what works and, more importantly, what doesn’t.
When launching a solution or service, the company should run a pilot in a percentage of stores (eg, 10% or more) and evaluate the process and results. Key findings or identification of start-up issues can be useful when rolling out across the store network to troubleshoot issues prior to implementation.
Deploy phased implementation
IoT projects not only require a mix of experts from different industries to work together, but also require an IoT team that meets the needs of identified use cases. To ensure a successful IoT deployment, a team must be flexible, always ready to adapt to situations and effectively counter any visible or unforeseen challenges that may arise. These challenges are just the tip of the iceberg. From IoT readiness to interoperability, each function will be tested to the extent of its capabilities. A phased implementation allows the IoT team to test the system and implement a rule-based machine learning algorithm to capture and analyze data at each communication layer.
The future of IoT in retail
As we head into 2022, there is no doubt that the use of IoT in retail will only increase. Retailers are realizing that IoT can improve business performance, as well as building operations to improve indoor air quality, occupant comfort, productivity and operational efficiency. It is essential for businesses to embrace the idea of IoT technology and start planning for its implementation.
IoT is a very complex beast, but with an experienced team, strong implementation process, and adaptability, a company can establish an IoT-based smart building strategy. Retailers must also accurately assess risk, design workarounds to address challenges, and execute strategy with laser focus to achieve maximum IoT potential.
Parminder Singh is responsible for sales enablement and offer management at Energy efficiency perspectives, part of Carrier. He leads solution engineering and pre-sales in North America and is primarily focused on building energy management and IoT solutions for multi-site operators.