IoT Lighting Solutions for a Shifting Retail Landscape

In an article for Smart Cities Dive, Navigant Research says omnichannel marketing is key to informing customers and boosting sales

As digitization and e-commerce continues to reduce the number of brick and mortar stores, retailers and lighting manufacturers are using creative solutions to keep customers coming and sales afloat.

In an article for Smart Cities Dive, Krystal Maxwell, research analyst with Navigant Research, said lighting manufacturers and technology firms are addressing pain points in retail with Internet of Things (IoT) solutions.

"One area where retail is expressing interest is lighting-based indoor positioning systems (IPS), which provide the means to address these issues and help retailers in their goal of creating an omnichannel approach," said Maxwell.

This approach describes a shopping experience, where reviews, product information, and sales marketing are easily accessible. Navigant says new IoT lighting systems are helping retailers use this strategy by moving technology towards luminaire control instead of zone control. This shift can help customers navigate a physical store more seamlessly, while also providing valuable real-time data to retailers such as customer location and product proximity.

"Beyond potential increased revenue for retailers, this can enhance the customer shopping experience, help increase customer loyalty, and provide brick-and-mortar retailers a solution to address this shift in the retail landscape," said Maxell.

Last fall, Target become one of the first retailers to announce its interest in IPS, moving to include them in 1,800 of their U.S. locations. The announcement comes after years of trials with IoT technology that includes LED luminaires embedded with Bluetooth and visible light communications. The technology could be used to direct customers to products with store maps via mobile applications, or even send relevant coupons and product reviews.

According to Navigant, retail IPS deployment has started with several different vendors, including Philips Lighting, OSRAM, and Zumtobel. However, IoT lighting solution deployments are still too new to provide quantitative data on their success in the retail industry. However, one IPS deployment by a French retailer recently showed the success of the system in increasing sales. E. Leclerc sent access to a mobile applications to 2,260 customers for indoor mapping functionality and product offers. 1,119 of them downloaded the retailer’s app and 771 customers used it. Of that segment, sales increased 34%-42%.

"Beyond potential increased revenue for retailers, this can enhance the customer shopping experience, help increase customer loyalty, and provide brick-and-mortar retailers a solution to address this shift in the retail landscape," said Maxwell.

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