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IoT in Retail: Top Use Cases, Benefits, and Challenges

429 Views | 1 min | Published On: May 29, 2023 Last Updated: May 6, 2024
IoT in retail

According to Grand View Research, the global Internet of Things (IoT) in the retail market was valued at 42.38 billion USD in 2022. This is further expected to grow at a CAGR of 28.4% from 2023 to 2030. This growth is attributed to the induction of in-store and digital operations in the retail sector.

Needless to say, if you have recently visited your local retail store, supermarket, or convenience store you must have observed how inescapable the IoT has become in the retail industry.

You might be wondering, what this IoT in retail is all about and how this is revolutionizing the ecommerce industry. Well, this blog on the same will let you know all you must know. It will make it clear why more than 70% of retail store owners are confident that IoT is going to impact how they will do business in the future.

IoT In Retail - Top 5 Use Cases & Benefits

As IoT is an extension of internet connectivity into physical devices, objects, and spaces, it opens whole new opportunities in fields like healthcare, transportation, real estate, and so on. Let’s see how it is transforming the real world.

benefits of IoT in retail

1.Inventory Management

This is a key use of IoT in the retail sector. Businesses strive to automate these procedures as much as they can because optimizing the inventory is currently one of the major difficulties in retail. IoT can assist in managing inventory and analyzing data to determine how popular each product category is. This way you can predict the demand and automatically modify your supply.

For example, RFID antennas scan the inventory and alert management when certain products are close to running out.

IoT technology for inventory management includes the following:

  • MIT Drone Inventory System monitors inventory and notifies users when certain items are out of stock.
  • RFID antennas scan the inventory and notify managers when they are running low on a certain product.

Lululemon uses RFID-based technology to inform customers of the stores where the things they want are now available. Their technology can track things automatically.

2.Location Tracking

The demand for online buying and delivery soared during the epidemic, making delivery one of the largest difficulties for modern retail. IoT can be used in retail logistics on a large scale. Then it doesn’t matter whether it’s regarding tracking products as they are delivered, forecasting delivery times, and improving logistical transparency.

You can also create a customer-facing IoT system that shows clients where their products are right now.

Locating your workers is another benefit when it comes to location tracking. You can keep track of your employees’ whereabouts in the warehouse and make it easier for them to locate items.

Moreover, the usage of location-tracking devices for asset and product tracking in retail is becoming more and more widespread in cases of loss and theft prevention.

Feneberg Lebensmittel (German supermarket chain) uses IoT technology for locating goods as well as employees, both within the warehouse and in transit.

IoT retail mobile app development company

3.Smart Shelves

Smart Shelves keep track of merchandise to ensure they’re never out of stock. It also makes sure that items are placed accurately on various shelves. RFID tags & readers along with weight sensors enable the scanning of the products on both stock shelves and display shelves.

As a result, your inventory procedure becomes more accurate and cost-effective. Additionally, Smart Shelves can identify in-store theft by attaching each RFID tag to a reader, thus saving money on security guards and cameras.

One of the reasons why the US-based supermarket chain Kroger has installed more than 2000 Edge Shelves (RFID-equipped shelves) throughout the center of the supermarket.

A strong network of interconnected sensors sends out

  • Automatic replenishment alerts for out-of-stock items and alerts for lost items.
  • Last scanned alerts for preventing theft.
  • Notifications of the expiration date and client interest (such as how often an item is picked up, looked at, and returned).

4.Buyer Behavior Tracking

Whether it’s insightful information on store traffic patterns or retention times in premium product areas, both are shared by occupancy sensors. Through efficient digital display ads, calculated space allotment, and planned aisle layouts, this data enables better planning of in-store merchandising and directed marketing.

Additionally, this information can be used to monitor checkout wait times in order to improve customer service by adding more self-checkout lanes or staff members.

IoT was used by Dandy Lab to give its customers an amazing in-store shopping experience.

  • Multiple sensors and WiFi routers in the store record the movement, under the support of a powerful data analytics system.
  • Enables shoppers to communicate with the designers or manufacturers regarding products on display while offering suggestions for a design change.

5.Contactless Payments and Cashier-less Checkouts

Have you ever witnessed consumers leaving your store because of lengthy lines? Contactless and cashier-less checkouts can help you streamline the payment process while saving money on hiring cashiers.

Zara has installed self-service checkouts that automatically scan things thus allowing customers to skip lines.

Installing a POS system will allow customers to scan their own purchases and make card or cash payments. You can follow the Amazon model, where customers can just leave the store and a system will immediately charge them for all the items in the virtual cart. Amazon tracks customer actions and registers what they put in their cart using a system of sensors and cameras.

IoT in Retail - Top 3 Challenges With Solutions


Privacy and security are two major issues with IoT. The General Data Protection Regulation (GDPR)’s adoption has made the security issue more pressing than ever. Where retailers have huge opportunities to access customer data, cyberattacks are on the rise.

This is where they need to collaborate with IoT software developers for effective IoT security solutions. They must hire an IoT application development company that has earned a solid reputation for providing robust security solutions.

Moreover, whether it’s end-to-end encryption, secure passwords, regular software updates, and so on, the development agency must ensure to take care of all.


When it comes to handling massive amounts of IoT data, most retailers require greater network bandwidth and equipment. Retail businesses need to make considerable investments in strong networks, data centers, cloud computing, and customer-facing solutions like mPOS, barcode scanners, and tablets in order to complete the digital transformation of their stores.

This is where retailers can start initially with minor changes, like using IoT for managing air conditioning and lighting systems. They can then proceed ahead with sophisticated IoT solutions, like traffic analytics.

3.Data Management & Analytics

IoT data analysis can be a difficult task to handle if a retailer lacks the necessary qualifications.  Employees in the eCommerce industry, such as marketers and sales managers, frequently lack the technical expertise needed to extract meaningful data from IoT systems.

This is where experts and third parties can prove to be fruitful as they have relevant qualifications, training, and skills to handle a specific task accurately.

How Can Apptunix Help You Set Up IoT in Your Retail Business?

Apptunix has created multiple IoT applications in the past. Whether it’s technology consultation, IoT software development or enhancement, IoT retail mobile application development, full-cycle IoT development, and so on, we can make your IoT journey a profitable investment by giving you a competitive advantage.

So if you are looking forward to powering your business with IoT technology, Apptunix can prove to be a game changer.

cost to develop an IoT based retail mobile app

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