Business Design

IoT in Retail

November 2, 2016

Last night, I went to the grocery store to buy some ice cream. As I was talking down the grocery isle to find the perfect vanilla, I noticed the lights got brighter as I walked closer to the ice cream. Looking up I saw a motion detector on top of the refrigerator door, making me realize I was not alone. I bought some Hudsonville Vanilla ice cream and went home to do more research.

iot

It turns out that LED motion detection lights have been around in grocery stores for several years. I was shopping in D&W in Grand Rapids, Mich., but they are commonly used throughout Kroger and Publix stores as a way to save energy. My research showed some serious economical and environmental savings:

“Publix has cut its electric use by 7% overall and about 23% in new stores since launching its “Get Into a Green Routine” program in 2002…the installation of LED lighting in its frozen and refrigerated cases cut energy use there by 50-80%.”

So what can a motion detector light on an ice cream isle teach us about the Internet of Things (IoT)?

I think a lot.

IoT applications need to be more than just a “cool” concept but needs to provide tangible benefits for consumers and/or the environment. At first thought, I assumed the motion detector at the grocery store was not likely connected to the Internet but upon further research I realized it is very common to be connected - and this is just one of many examples for using LED lights. The internet connectivity provides real-time analytics and data back to the home office on energy efficiency and cost savings.

Business Insider recently reported that several grocery stores including Target are now using in-store LED beacons to help customers find what they are looking for in the store by lighting up the way. For example, a customer can download an app and indicate they are looking for organic carrots. The app will help guide the customer to the right isle and then light up an LED beacon showing the carrots. According to the article, “this helps customers find products without having to ask Target employees for assistance, as well as giving the company more data about customers’ foot traffic within the store. With this data, Target can reduce the staff needed to assist customers, place items more thoughtfully in high-traffic areas, and target customers even more specifically in promotions via app as they walk around the store. Customers can choose to disable the pilot functionality within the Target app.”

I believe we are seeing just the beginning of the capabilities and benefits of IoT. While the technology is impressive, the real value comes not in the glamor of shiny things - but in the tangible benefits for consumers and the environment.

References: Business Insider Kroger Case Study Motion Sensing LED lights

Mark Johnson
Mark Johnson
Co-founder & Managing Partner

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