How IoT is helping retailers boost customer engagement

In today’s day and age, it is impossible to imagine a world without the Internet. We rely on it for everything from work to paying bills, managing our social lives and much more. We carry the Internet with us on our mobile devices wherever we go and use it to enhance our everyday lives in various ways. The number of devices able to connect to the Internet are increasing exponentially and have thus created the term Internet of Things, or IoT.

The Internet of Things continues to gain momentum in the technology industry. Not only do IoT technologies have the potential to change the way we work, but they also have the ability to change the way we live. Since IoT plays a larger role in our lives, businesses are beginning to recognise the value of these technologies, particularly when it comes to connecting with customers.

New IoT technologies are helping retailers boost customer retention by creating a better shopping experience, which in turn increases customer loyalty.

How IoT is transforming customer engagement

In the past, the interaction between a company and its customers was restricted to the point-of-sale. As a result, companies were forced to collect data from customer surveys, product returns, product reviews, and anecdotal feedback to gain insight into the needs, preferences, and behaviours of their customers. This meant that companies tended to practice reactive customer engagement instead of proactive customer engagement.

Fortunately, companies are changing the way they practice customer engagement for the better, thanks to IoT technologies, which are making it easier for companies to engage with customers and collect data in a non-intrusive way.

What is more, the use of IoT was formerly largely limited to industrial applications. Nowadays, business-to-consumer (B2C) companies are recognising the potential IoT technologies harbour to transform customer engagement. For example, Target has turned to IoT in order to move forward when it comes to customer engagement. Target has established Connected Home stores in several locations. These stores serve as a recreated home environment, where customers can try Target’s connected devices in an immersive environment. Target demonstrates the use of their connected devices in the Connected Home, boosting customer engagement.

BMW is also using IoT to increase customer engagement. If a consumer locks their keys in their vehicle, they can call BMW Assist instead of a locksmith or an AAA. In many cases, all the consumer needs to do is answer a few simple questions, and BMW will unlock the doors of the vehicle remotely. BMW Assist is an example of how IoT technologies can be used to not only boost customer engagement, but also change the lives of customers for the better.

How businesses can use IoT to connect with customers

Today’s consumers have come to expect personalised services and products that are tailored to meet their desires and solve their unique problems. Moreover, consumers demand relevant interactions through a variety of channels. Fortunately, IoT technology fulfils both, not only by establishing strong connections between things, people, and processes, but also by providing specific insights so that companies can meet their customers’ needs in real time.

Application of IoT in business

If you want to boost customer engagement, here are a few ways through which your business can do just that with IoT.

1. Monitor and improve experiences

As a business, you should focus on using IoT technologies to monitor and improve the experiences of your customers. For example, car manufacturers can monitor the status of vehicles and let consumers know when there is a problem that needs to be fixed. Consumers are increasingly expecting to receive automatic updates and pertinent information about their IoT devices.

2. Personalisation

Businesses can also use IoT technologies to personalise situations for customers. IoT devices can change and refine capabilities and services based on information collected about the user’s surroundings.

3. Gradual improvements

IoT technologies are proving to be particularly helpful when it comes to making improvements to products and services over time. These technologies are making it easier for businesses to collect data in order to improve customer experiences. For example, Tesla released the Tesla Autopilot feature based on information collected from IoT sensors.

Undoubtedly, the Internet of Things is here to stay, which is why many businesses are jumping on the IoT bandwagon to boost customer engagement. Now, more than ever, it is crucial for retailers to have a well-defined IoT strategy in order to stay competitive.

This editorial was first published in our Payments and Commerce Market Guide 2018-2019. The Guide presents the key trends and developments in global and regional payment methods by highlighting the innovation, challenges, and developments in the use of the most important payment methods across geographies and verticals.

About Markus Bergthaler

Markus oversees the development of the association’s entire programme and marketing content, including strategy, conference education, subject matter, website content, benchmarking, and online forum topics. Markus joined the MRC from Wizards of the Coast, where he led the company’s fraud department.

About Merchant Risk Council

The Merchant Risk Council is the leading global trade association for fraud and payments professionals. The MRC provides support and education to members with proprietary benchmarking reports, whitepapers, presentations, and webinars. The MRC hosts four annual conferences in the US and Europe, as well as regional networking meetings for professionals to connect, exchange best practices, and share emerging trends. #ProudlyACommunity