Internet Of Things (IoT) In Retail Market Size, Share & Trends Analysis Report By Component (Hardware, Services), By Technology, By Deployment (Cloud, On-premise), By Application, By Region, And Segment Forecasts, 2023 - 2030

Report Overview

The global internet of things (IoT)  in retail market size was valued at USD 42.38 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 28.4% from 2023 to 2030. This growth is attributed to the inclusion of in-store and digital operations in the retail sector. For instance, in January 2023, Google Cloud launched four updated and new technologies to aid retailers in enhancing their in-store shelf-checking processes along with enhancing their e-commerce sites. Moreover, the implementation of self-checkout automation in stores is allowing customers to quickly and easily complete their transactions, which is expected to drive the  internet of things in retail market growth over the forecast period.

In addition, IoT technology delivers a competitive edge to retailers with the help of Radio-Frequency Identification (RFID) tags and smart shelves, which detect low inventory and track the movement of the respective goods. The adoption of IoT technology helps retailers effectively manage in-store operations and provide an enhanced shopping experience to their customers. In addition, factors, such as supply chain management, inventory management, effective store premise monitoring, and customer behavior observation, are driving the demand for IoT in the retail market. Furthermore, significant aspects of the adoption and implementation of IoT among retailers are automating and optimizing the supply chain operation.

Connecting technologies, such as digital signage, beacons, price tickers, and on-shelf displays, provide several prospects for a brand to access a large amount of data based on customer or consumer activity during in-store or physical shopping, which is expected to drive the market growth over the forecast period. The retail sector has experienced exponential growth with the evolution of Artificial Intelligence (AI) and Augmented Reality (AR) in retail stores. Retailers use AI to understand the buying patterns of old customers, identify the target audience, and offer customized product ads to their customers.

Moreover, AI has offered its conventional capability for conversational commerce, as retailers are incorporating chatbots with messaging applications, allowing users to interact with their brands. This, in turn, is expected to boost the market growth further. Implementing IoT for employee management software will also propel the industry growth. The software has been used in industries for decades to manage payroll and employee scheduling, and with the implementation of IoT, new possibilities have emerged. The data collected from retail scheduling software allows enhancing employee performance along with the business, which is anticipated to augment the industry growth over the forecast period.

Component Insights

The hardware component segment recorded the largest revenue share of over 46% in 2022 owing to the prominent use of sensors and RFID tags in the industry by retailers. Moreover, the decreasing prices of IoT sensors and a rise in the number of connected devices in retail outlets are expected to drive the segment growth. In addition, the RFID tags facilitate real-time visibility of inventory for automating the process of replenishment, which aids in meeting consumer demands and operational consistency. The growing RFID ecosystems, along with the price reduction, enable item-level merchandise tracking, which is expected to drive segment growth over the forecast period.

The services component segment is projected to grow at a significant CAGR of 31.1% over the forecast period. The services component type is further bifurcated into professional and managed services. Significant adoption of IoT in the retail sector has augmented the demand for application and infrastructure management services. IoT product and solution providers are also offering professional services related to repair and maintenance, training & helpdesk support, and installation & deployment as their essential services. Furthermore, retailers require modified solutions to boost their productivity and efficiency, and the need for such customization is propelling segment growth further.

Technology Insights

The Bluetooth Low Energy (BLE) technology segment is expected to grow at the fastest CAGR of 31.0% over the forecast period. This is mainly due to the technology’s low cost and low power solution. BLE devices can operate on small batteries for an extended period, which makes them ideal for use in retail environments where a large number of devices are required. Furthermore, regarding payments, the technology makes store check-in and intelligent interaction much easier to implement, which is expected to propel the segment’s growth over the forecast period.

The Near Field Communication (NFC) technology recorded a considerable market share of over 32% in 2022. Mobile operators and device manufacturers are undertaking numerous projects to increase the coverage of NFC-based transactions. In addition, the rise of mobile wallets has modernized payment methods, providing a boost to NFC adoption in the retail sector. Moreover, supermarkets and medical stores implemented NFC technology to quicken the check-out processes and to manage the rush during the pandemic.

Deployment Insights

The on-premise deployment segment recorded a significant market share of over 48% in 2022 and this trend is expected to continue over the forecast period. The segment’s strong growth is attributed to the advantages offered to retailers, such as control over data security & privacy, reliability, cost savings, and customization options. In addition, the on-premise deployment is more cost-effective than cloud-based solutions for retailers with large-scale IoT deployments. Since data processing and storage are performed locally, retailers can avoid costly data fees and other cloud-based costs, which is fueling the segment growth further.

The cloud deployment segment is anticipated to grow at the fastest CAGR of 31.5% over the forecast period. This is attributed to the ability to perform real-time analytics on data acquired by IoT devices, such as beacons, cameras, and sensors, among others. Furthermore, this data also helps retailers get insights about buying behavior, to optimize store layouts and product placements, along with identifying peak shopping periods and adjusting staffing in the store accordingly. This is anticipated to drive the segment growth over the forecast period.

Application Insights

The customer management segment is projected to grow at the highest CAGR of 33.1% over the forecast period. The segment is further divided into smart vending machines, smart shelves, queue management, and automated checkout. Customer management solutions enable retailers to deliver a customized, personalized, and engaging experience to their customers, which is driving the segment growth. Furthermore, IoT devices and sensors provide retailers with a wealth of data on consumer buying behavior and preferences, which is used to enhance customer engagement strategies in numerous ways, such as customer segmentation, customer feedback, and personalization. This, in turn, is expected to drive the segment growth further.

The operations management segment recorded the highest market share of over 31% in 2022. The operations management segment is further divided into inventory management, supply chain automation, workforce management, and security & safety. Operations management contributes to the growth of the IoT in the retail market by providing tools and strategies to improve the effectiveness and efficiency of various retail operations. Moreover, retailers can advance supply chain management, inventory management, and security & safety, among others, by leveraging IoT data and technology, which leads to reduced costs, increased sales, and improved customer satisfaction. This, in turn, is expected to propel the segment growth over the forecast period.

Regional Insights

North America accounted for the highest market share of over 30% in 2022. This can be attributed to the proliferation of e-commerce in the region, which has allowed department stores to excel in their business operations. The presence of major players in the region, such as IBM Corporation, Google LLC, Microsoft Corporation, Intel Corporation, and PTC Inc., with strong R&D capabilities, is also contributing to its growth. For instance, in December 2022, Google Cloud, part of Google LLC, partnered with KORE, a key player in IoT solutions, to help enterprises create robust IoT solutions and extract the benefit of IoT technology.

Asia Pacific is expected to emerge as the prominent region, growing at a CAGR of 32.7% over the forecast period, with China being the primary adopter of the internet of things in retail. India has a strong growth potential due to the rising retail sector investments, which is expected to contribute to market growth as well. Moreover, the increasing adoption of location-based services and real-time systems is expected to augment regional market growth. A decline in the sensors’ price, along with the convergence of technologies, such as analytics, mobility, cloud, and big data, is propelling the adoption of IoT technology across the region.

Key Companies & Market Share Insights

The competitive landscape highlights the dynamics in the industry, which is reshaping the global market. Incumbent companies and new entrants anticipate organic and inorganic growth strategies, such as technological advancements, mergers & acquisitions, product launches, and geographical expansion, to remain dominant. For instance, in January 2023, SATO Holdings Corporation, a prominent player in labeling and auto-ID solutions, partnered with Energous Corporation, a key producer of wireless power networks. This partnership is expected to develop custom solutions that integrate IoT solutions with Energous’ 1W WattUp PowerBridge transmitters for advanced smart store solutions. Some of the prominent players in the global internet of things in retail market include:

• Arm Limited

• Cisco Systems Inc.

• Google LLC

• IBM Corporation

• Impinj, Inc.

• Intel Corporation

• Losant IoT

• Microsoft Corporation

• NXP Semiconductors

• PTC Inc.

• RetailNext, Inc.

• SAP SE

• Softweb Solutions Inc.

• Verizon Communications, Inc.

• Zebra Technologies Corporation

Internet of Things (IoT) in Retail Market Report Scope

Global Internet of Things in Retail Market Segmentation

This report forecasts revenue growth and provides an analysis of the latest trends in each of the sub-segments from 2018 to 2030. For this report, Grand View Research has segmented the internet of things in retail market based on component, technology, application, deployment, and region:

• Component Outlook (Revenue, USD Billion, 2018 - 2030)

  • Hardware

  • Beacons

  • RFID tags

  • Sensors

  • Wearables

  • Platform

  • Connectivity Management

  • Application Management

  • Device Management

  • Services

  • Professional Services

• Technology Outlook (Revenue, USD Billion, 2018 - 2030)

  • Bluetooth Low Energy

  • Near Field Communication

  • ZigBee

  • Others

• Application Outlook (Revenue, USD Billion, 2018 - 2030)

  • Operations Management

  • Inventory Management

  • Supply Chain Automation

  • Workforce Management

  • Security and Safety

  • Customer Management

  • Smart Vending Machine

  • Smart Shelves

  • Queue Management

  • Automated Checkout

  • Asset Management

  • Asset Tracking

  • Predictive Management

  • Advertising and Marketing

  • Smart Digital Signage

  • Geomarketing

  • Others

• Deployment Outlook (Revenue, USD Billion, 2018 - 2030)

  • On-premise

  • Cloud

• Regional Outlook (Revenue, USD Billion, 2018 - 2030)

  • North America

    • U.S.

    • Canada

  • EuropE

    • UK

    • Germany

    • France

    • Italy

    • Spain

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa

    • UAE

    • South Africa