Top 9 IoT use cases in retail

A quick trip to your local retail store, supermarket, or shopping mall would suggest how inescapable the Internet of Things (IoT) has become in the retail sector.

According to the Research & Markets Analysis the IoT in the retail market was valued at $28.14 billion in 2021, and is estimated to reach $177.90 billion by 2031. North America will dominate the IoT in the retail industry. It is attributed to factors including an increase in digitalization and the adoption of IoT solutions by the retail sector. However, the Asia-Pacific region is to witness the highest growth rate during the forecast period (2031).

The role of IoT in the retail market

IoT refers to a network of physical devices, objects and spaces embedded with Bluetooth beacons, sensors, Global Positioning System (GPS) and Radio-frequency identification (RFID) technologies. It helps brands track the location, condition and movement of their assets and inventory anytime, anywhere. Retailers get 360-degree visibility by connecting and exchanging data with systems and devices over the internet.

Top 9 IoT use cases in retail:

1.Inventory management
IoT sensors can monitor and track inventory levels in real time. When the company runs out of a particular item, the system can automatically reorder the necessary items based on IoT data analytics. This helps retailers optimize their inventory, minimize costs, and ensure product availability. Implementing smart inventory management systems encompassing RFID tags, store shelf sensors, beacons, digital price tags, and video monitoring coupled with image analysis can enhance procurement planning at every level of the supply chain.

2.Product placement
Knowing which areas of your retail shop have the most foot traffic can shape your product placement strategy. If through periods of extensive data-gathering and analyzing you have come to know that there’s a 60% chance that upon entering your store, the customer will turn right, then you might want to place your over/underperforming items in their eyesight.

3.Smart shelves
Smart shelves are tagged with RFID that can track the inventory that’s placed on them. So whenever a soda bottle, for example, is taken off a specific shelf, the employees are instantly notified of one less inventory that’s on the shelf. This is a helpful addition to inventory management because it could eliminate shortages as the notification of restocking will be done in real time.

4. Inventory lookup
Another use case of smart shelves is the items’ positioning. Let’s say the customer wishes to know the specific location of a ketchup from a certain brand. The employee can search the keyword on an application to know where, on which aisle and shelf the ketchup is positioned.

5. Digital price tags
These electronic shelf labels are connected to a store’s digital inventory, displaying real-time updates to customers about the price and the quantity available. This enables complete price control at all times and guarantees customer’s satisfaction regarding displayed price accuracy.


Moreover, setting up digital price tags would cost less rather than printing out new paper price tags to reflect the rising prices (especially during inflation period), and the number of employee manipulations can be significantly reduced. Due to electronic shelf labels, stores can take advantage of dynamic pricing – the ability to adjust prices at will based on demand, online competition, inventory and shelf life, and to create promotions easily.

6.Smart shopping carts
Retailers can tag their existing carts with motion tracking sensors and connect them to tracking software to identify the position of the cart.
Amazon, for instance, has Dash carts in their stores. These carts keep track of shoppers’ purchases and allow them to complete their transaction while exiting the store, bypassing the checkout and self-checkout lines.
How it works: sensors automatically identify the cart and the items selected, and the customer’s payment is processed using the credit card on their Amazon account. A receipt is emailed to the customer.

7.Personalized marketing
IoT devices can enable proximity marketing by sending targeted offers and promotions to customers’ smartphones when they are in close proximity to specific products or store sections.
Starbucks, for instance, uses iBeacon technology that sends promotion and sales notifications to the nearest passerby’s phone via Bluetooth.
This helps retailers deliver personalized marketing messages and increase customer engagement.

8.Connected vending machines
IoT-enabled vending machines can be remotely monitored for stock levels, maintenance needs, and performance. This allows retailers to proactively manage their vending machines, ensure product availability, and streamline operations.


9.Smart mirrors
IoT-powered smart mirrors (also known as digital mirrors, or magic mirrors) equipped with cameras and sensors can provide customers with virtual fitting experiences. Shoppers can try on clothes virtually, see different color options without having to visit the changing room. Furthermore, magic mirrors display virtual add-ons like accessories and makeup, and give personalized recommendations.


In conclusion, the use of IoT and smart devices in retail has revolutionized the shopping experience for both customers and retailers. Theft prevention, in-store navigation, and customer engagement are just a few of the advantages. The applications of IoT in retail continue to evolve, providing opportunities for retailers to enhance operations, improve customer experiences, and drive business growth.