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IoT and the customer experience: What to expect in 2020

Consumers are finding themselves increasingly surrounded by technology that talks to each other. See how retail is incorporating IoT and affecting customer experience.

IoT and customer experience have been converging for some time, and as the number of IoT devices increases, so will their role in connecting with the consumer.

And it's not just about connection: IoT is also poised to improve CX indirectly by making retail stores more responsive and the businesses behind them more efficient.

Put all of this together, and it signals a resurgence for retail, which has suffered in the shadow of online giant Amazon and its smaller cousins.

Bringing the digital and physical worlds together

The flashy union of IoT and customer experience centers on customer touch -- introducing devices into the retail environment that enhance CX in ways that motivate consumers to get off the couch and drive to a store rather than making a purchase on the internet. Immersing the customer in a new-and-improved retail environment that responds both immediately and personally is the goal, and IoT is how it's happening.

Smart mirrors -- digital displays that show the customer what a particular garment will look like on them without trying it on -- lead the charge here. This is a huge timesaver and novelty that enables potential buyers to go all-in, checking out not only the clothing, but also the accessories, all at once, to find a certain look. Neiman Marcus is the pacesetter in this regard. Its MemoryMirror not only displays the customer with a garment on, but it also displays two side by side. Then, there's Ralph Lauren's dressing room mirror, which displays the garment and then makes recommendations to complete an ensemble.

There are less obtrusive devices, such as beacons -- Bluetooth devices that sense customers' approach and serve up coupons and other notifications relevant to products in their path -- which are proliferating. And they're not just useful in retail. The city of Manchester, England, uses them to guide tourists around the city, presenting points of interest, event notifications and other useful data.

While IoT is courting the buyer, it is also collecting data, and that data makes the sales floor itself more efficient.

Consumers may not notice some IoT, but it's there all the same, such as camera systems that track the depth of checkout line queues to optimize them and vending machines that analyze the behaviors and purchasing patterns of users, collecting data to optimize presentation and replenishment.

A more efficient marketplace

While IoT is courting the buyer, it is also collecting data, and that data makes the sales floor itself more efficient.

Customer traffic patterns as they move through stores help to optimize product placement. IoT sensors on shelves along with RFID tags can track remaining product and communicate with the inventory system and staff so that no shelf ever goes empty. And, where product is perishable, constant monitoring of temperature can eliminate waste.

When it comes to garments and dressing rooms, as mentioned above, it's important to note that the same devices showing the buyer how they look in the trendy pullover are also gathering data on which garments are most popular and which customers purchase them most often after trying them on, optimizing purchasing and unearthing local trends.

Always getting better

Replenishing shelves and automating inventory -- made possible through sensors and RFID -- make the case that uniting IoT and customer experience isn't just a reinvigoration of retail; it's also a smart economic move. Such a system quickly pays for itself through improved inventory accuracy and time savings for staff.

This capacity for improvement extends to the customer. For example, Amazon has even taken the step of using its own IoT -- the Echo digital assistant -- to provide customer value in the insurance industry. Amazon partnered with Travelers Insurance in 2019 to deploy smart home kits to enhance home security, a boon for Travelers that enables lower policy premiums for the homeowner.

This same thinking applies to car insurance, especially in homes that include teenage drivers. The technology in telematics-equipped vehicles can capture and study driving habits and reward the parents of safe, younger drivers with a lower insurance bill.

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