The Internet of Things is changing business models, and will have a revolutionary impact on the retail sector
Modern retail has seen something of a tech revolution in the past few years, with new innovations becoming available on a regular basis.
The pace of change is so great that today’s bright spark is next year’s standard requirement.
For example, the smart shelves launched by Mondelez International, in 2013 were marketed as state-of-art technology, but are now considered a simple modular solution (Dell, Panasonic – Smart Shelves). Such is the rapid evolution of technology.
Similarly, recent hot topics, such as cloud and big data, will soon no longer be considered cutting-edge technology. Indeed, the technology frontier and competitive edge will move towards the Internet of Things (IoT), and the shift has already started.
So, what is IoT? Gartner describes it as “the network of physical objects that contain embedded technology to communicate and sense or interact with their internal states or the external environment”.
A recent Gartner survey has marked IoT as the fastest growing trend in technology and estimates that by 2020, the number of Internet connected objects will increase by 30 times.
Many are familiar with Pervasive Computing/Ubiquitous Computing and will imagine IoT as just a new moniker to an old concept.
However, what has changed recently is the evolution of cloud technology.
Thanks to cloud-enabled solution offerings, actionable data can now be generated by connected objects.
With the decreasing cost of integrated chips, technology supported by a cloud platform and powered by big data analytics along with machine learning is the triad that is driving the growth of IoT.
While IoT represents a huge opportunity for almost every facet of human enterprise, this is especially true for the practitioners of supply chain/operations/analytics.
Leaders in both e-commerce and traditional retailers are exploring adoption of IoT to gain a competitive edge.
The aim is to gain better visibility along the demand and supply side of the value chain; to reduce variability by actively countering any ripples along the chain, and to get better returns by enabling optimised velocity of product flow.
There are several developments already underway in IoT that are revolutionising the traditional retail supply chain in multiple ways right now.
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