How Direct Response Marketers Can Leverage the Internet of Everything for Increased Profits

by Lisa Fretwell on Feb 6, 2015 3:00:00 AM Digital Marketing

How_Direct_Response_Marketers_Can_Leverage_the_Internet_of_Everything_for_Increase_Profits-109858-editedThe rise of mobility and the emergence of sensor-equipped objects and their networks—known as Internet of Everything (IoE) or Internet of Things (IoT)—have created a disruption in the retail industry similar to what we saw with e-commerce in the late 1990s and early 2000s. As evidence, consider that in the second quarter of 2014, total discretionary retail spending rose just 3 percent and e-commerce rose 10 percent, while mobile commerce spending rose a full 47 percent.i This sweeping transformation has changed the shopping behaviors of digital consumers, who have come to expect a rich palette of retail experiences that provide ever-increasing value and convenience both in-store and out. And it’s not simply younger consumers, who are immersed in the connected world. Today’s digital consumer transcends traditional demographic segmentation of age and income. Research shows that the majority of all consumers use a variety of digital tools to shop, and they expect retailers and marketers to use all available channels to provide greater convenience, efficiency and savings.   

To better understand what consumers desire in their retail shopping experience today, we surveyed more than 1,200 retail consumers across the U.S. and the U.K. to ask their preferences around IoE-enabled concepts such as in-store mobile offers, dynamic digital signage, augmented reality and more. The results of our survey showed that hyper-relevance is the key to engaging with customers and increasing sales conversions. Hyper-relevance is about understanding the context of the situation to deliver exactly what that consumer wants in that moment based on their actions and behaviors. The IoE makes this possible by connecting people, processes, data, and things to deliver deep analytics that provide the context necessary for retail marketers to understand each individual consumer’s needs at that point in their shopping journey.

Today’s technology enables an analytics-driven approach that incorporates data from the consumer’s smartphone, in-store sensors and beacons, video, and other sources in order to apply real-time intelligence and deliver what the consumer wants in that moment. Analytics provided by this type of technology allows retailers and marketers to know where a shopper is lingering in a store, what products they’re looking at, when they’re seeking additional product information, or when to suggest complementary products. For example, direct response marketers can drive increased sales by providing relevant offers to a consumer’s smartphone, they can share ratings and reviews when a shopper scans the barcode or QR code of a product they’re interested in. They can use data from sensors in the store to understand where the consumer is lingering and what they are looking at both physically and virtually.

We asked consumers what types of IoE-enabled experiences they would like to see in-store, and found that shoppers most desired the types of experiences that deliver savings and engagement.

Following are the percentages of respondents who are “somewhat” or “very likely” to use these IoE-enabled concepts:

Savings (Discounts and Promotions)

  • General in-store offers via digital signage (79 percent): View general offers of discounts or special deals available to everyone in the store.
  • Special offers via augmented reality (73 percent): Using augmented reality on a smartphone to view special customized offers and promotions in the store.
  • Targeted offers via digital signage (67 percent): View offers on nearby digital signs tailored to a consumer’s interests and preferences.
  • Targeted offers via smartphone (54 percent): Receive targeted offers to your smartphone based on your interests and preferences.
  • Scan QR codes (52 percent): Scan a QR code using your smartphone to access special offers for products displayed on the digital signs.

Engagement (Learning about what’s new, entertainment, exploring accessories, etc.)

  • Reviews (57 percent): Use augmented reality apps to receive information about products, such as online consumer reviews.
  • In-store advertising (54 percent): View advertisements and obtain information about products in the store.
  • Product recommender (48 percent): See recommended products or accessories to accompany a product you just scanned, via augmented reality on a smartphone.
  • In-store Top 10 (45 percent): Check the most popular products sold in the store at any given time.
  • In-store entertainment (38 percent): Watch entertaining or informative videos, such as product demonstrations.

The Value at Stake

IoE is shaking up the competitive dynamics in nearly all industries—particularly in retail. The in-store shopping experiences described above are at the heart of the IoE value that is up for grabs, in terms of revenue uplift. What’s more, direct response marketers can leverage the analytics provided by IoE-enabled technologies including mobile, in-store sensors, video cameras, interactive digital signage and more; to increase sales by providing consumers the convenience, efficiency, savings, and relevant engagement they have come to expect.

Image courtesy of stockimages/

Lisa Fretwell is the Internet of Everything managing director, Consulting Services, Cisco Systems. Read more about the consumer survey on IoE in retail here.

 i “Q2 M-Commerce Explodes to 47% Y/Y Gain: What it Means for the Growth of Mobile,” comScore, August 19, 2014
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