Internet of Things (IoT) In Retail Market Report

Internet of Things (IoT) In Retail Market Analysis By Solution, By Hardware (Beacons, RFID Tags, Sensors, Wearables), By Service, By Technology (Bluetooth Low Energy, Near Field Communication, ZigBee), By Region, And Segment Forecasts, 2014 - 2025

  • Published Date: Jan, 2017
  • Base Year for Estimate: 2016
  • Report ID: GVR-1-68038-752-0
  • Format: Electronic (PDF)
  • Historical Data: 2014-2016
  • Number of Pages: 150

Industry Insights

The global IoT in retail market size was estimated at USD 13.51 billion in 2015. The Internet of Things offers an opportunity for retailers to develop an improved ecosystem that connects the digital and physical worlds. Retailers are utilizing the advantage of the wide range of connected products by adopting an integration platform.

Traditional retailers are becoming more adept at using connected technology to compete against e-commerce platforms. Retailers are also experimenting with IoT, which allows them to determine the purchase history and customer’s profile by synchronizing with wearable devices. The adoption of common standards and proliferation of connected devices are augmenting the growth of IoT-enabled capabilities across the retail industry.

U.S. IoT in retail market, by hardware, 2014-2025 (USD Billion)

U.S. IoT in retail market

Digital sensors are offering considerable benefits to retailers, which enables Machine to Machine (M2M) communication for the purpose of sending discount codes, coupons, and product information. Retailers are combining smart technology with in-store solutions, such as beacons, wearables, Bluetooth Low Energy (BLE), and video analytics, for connecting with customers to collect a vast amount of data. Moreover, IoT enables users to tap into the cloud infrastructure and software to analyze the collected data in real time.

Solution Insights

The hardware segment captured a market share of over 60% in 2015. The surge in the number of interconnected devices in retail outlets and the increase in hardware installations spending are expected to propel the segment growth. Moreover, the government support and an urge to embrace connected technology in a bid to enhance productivity, stock efficiencies, and automate supply chains are enabling retailers to install hardware components.

Retailers’ commitment to innovation in smart technologies is contributing to the growth of connected devices, including both RFID tags and beacons. Matching the merchandise availability with consumer preferences and the increasing demand for enhanced in-stock product positioning along with the need for correct product assortments is propelling the demand for interconnected devices.

Hardware Insights

The market for RFID tags was valued at over USD 3 billion in 2015. RFID enables the real-time visibility of inventory for automating replenishment in order to ensure consistency and satisfying consumer demands. The maturing RFID ecosystem along with its price reduction is enabling the item-level tracking of each merchandise, thereby optimizing the inventory operations. The adoption of RFID tags is increasing the inventory accounting accuracy and margin growth by reducing product loss.

The RFID sensing and communication technologies are speeding purchasing transactions and reducing walk-away by providing desired products to the customers. Further, initiatives such as open standards of chip manufacturing to eliminate the need for proprietary tags have led to the decline in the prices of these tags. Falling technology and product cost are expected to boost the demand for RFID tags.

Technology Insights

Near Field Communication (NFC) accounted for a market share of over 25% in 2015. NFC combines the contactless smart card technology with mobile devices and allows for streamlined payment transactions over traditional cash and card payment methods. Device manufacturers and mobile operators are undertaking several projects to increase the coverage of NFC-based transactions. The emergence of mobile wallets has transformed the payment methods in the retail sector, providing a boost to the NFC adoption.

Robust utilization of geospatial data for asset tracking is spurring the demand for real-time location systems. These systems are widely used for locating and identifying objects and assets in real-time. Increasing need to track and analyze the customer data to generate buying patterns are expected to have a positive impact on the demand for real-time location systems.

Services Insights

Managed services captured a revenue share of over 40% in 2015. Retailers are outsourcing services to reduce risks so that they can focus on core competencies. The Payment-as-a-Service (PaaS) solution offers retailers gateway solutions and terminal management services that enable a more efficient routing of transactions, multichannel acceptance and processing, and payment value-added services such as mobile banking, POS terminals, and payment gateway.

Germany IoT in retail market, by service, 2015

Germany IoT in retail market

Moreover, retailers are seeking assistance in outsourcing their customer interaction services. The changing retail landscape towards connected technology has enabled retailers to realize the need for managed services. The implementation and adoption of these services help retailers to reduce the IT costs, thereby, enhancing in-store operations and efficiency.

Regional Insights

The European IoT in retail market held over 15% revenue share in 2015. The regional growth is hampered by the demand for culturally diverse and heterogeneous small and local stores. Moreover, the region is lagging in the IoT component arena and is largely dependent on object and component manufacturers in the Asia Pacific region. However, the regulatory framework that supports the Internet of Things adoption and the strong presence of connectivity providers are expected to contribute to the regional growth over the next nine years.

Asia Pacific is expected to be the prominent region with China as the largest IoT in retail market. India offers a huge potential for growth owing to the increasing investment in the retail sector. The increasing adoption of real-time location systems and location-based services is expected to contribute to the regional growth.

Competitive Insights

Key industry participants include Allerin Tech Pvt. Ltd., Impinj Inc., RetailNext Inc., Losant IoT Inc., and Intel Corporation. Network and service providers are engaging in partnership with component manufacturers to enter into the connected retail space. For instance, in May 2016, Microsoft Corporation announced the acquisition of Solair to create new intelligence and deliver complete IoT offerings for enterprises.

Report Scope



Base year for estimation


Actual estimates/Historical data

2014 - 2015

Forecast period

2016 - 2025

Market representation

Revenue in USD Billion and CAGR from 2016 to 2025

Regional scope

North America, Europe, Asia Pacific, Latin America, and MEA

Country scope

U.S., Canada, UK, Germany, China, India, Japan, Brazil, and Mexico

Report coverage

Revenue forecast, company share, competitive landscape, growth factors, and trends

15% free customization scope (equivalent to five analyst working days)

If you need specific market information that is not currently within the scope of the report, we will provide it to you as a part of the customization

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global IoT in retail market on the basis of solution, hardware, service, technology, and region

  • Solution Outlook (Revenue, USD Billion; 2014 - 2025)

    • Hardware

    • Software

  • Hardware Outlook (Revenue, USD Billion; 2014 - 2025)

    • Beacons

    • RFID tags

    • Sensors

    • Wearables

  • Service Outlook (Revenue, USD Billion; 2014 - 2025)

    • Professional services

    • Managed services

  • Technology Outlook (Revenue, USD Billion; 2014 - 2025)

    • Bluetooth low energy

    • Near field communication

    • ZigBee

    • Others

  • Regional Outlook (Revenue, USD Billion; 2014 - 2025)

    • North America

      • U.S.

      • Canada

    • Europe

      • Germany

      • UK

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

      • Mexico

    • MEA

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