The global smart retail market size was estimated at USD 10.74 billion in 2017. It is expected to register a CAGR of 23.9% from 2018 to 2025. The growing incorporation of technologies such as augmented reality, virtual reality, artificial intelligence, and IoT to improve store operations, facilitate accurate inventory management, and enhance consumer’s shopping experience is one of the key trends escalating market growth. These advanced retail technologies enable brick-and-mortar retailers to compete against online retailers, to recapture lost market share, attract more consumers into the store, and improve customer retention.
Major retailers such as Alibaba, Walmart, and Amazon are increasingly embracing smart retail technology to improve business operations and serve their customers better. Physical retailers are collecting customer data and analyzing customer behavior to personalize their shopping experience. Retailers are utilizing mPOS, beacons, and NFC technologies to greet customers by their name as well as to provide them with appropriate information.
With the incorporation of smart retail technology, physical retailers are poised to be able to attract, occupy, and convert prospective visitors into shoppers. The technology allows them to display targeted promotional messages and pop-ups on screens in retail stores specific to customer preferences. For instance, PepsiCo utilized Bluetooth Low Energy beacons to send mobile vouchers to customers at just the right time to turn foot traffic into potential sales.
In recent years, a large number of innovative technologies have been developed and introduced in the retail space. IoT is one such revolutionary technology that has led to a significant transformation in operations of the retail sector. Several retailers are investing in technology to capitalize on the potential of the industry. For instance, Amazon introduced Amazon Go, a smart grocery store that utilizes IoT technology to provide customers with the experience of shopping with no checkout lines or cashiers.
IoT technology is slated to stay in the retail sector for a long time. However, data security with this technology may be at stake for retailers as well as customers. The rising number of cybersecurity attacks is raising concerns among retailers. The retail industry is a prime target for hackers as the retail environment provides them potential access to customer payment information by exploiting connected devices such as point of sale systems. Therefore, before deploying IoT technology, retailers need to understand the risk involved as well as measures to be taken to prevent this attack. The high investment involved in data security related to IoT devices is projected to hinder the growth of the market.
The visual marketing segment accounted for approximately 30.0% of the overall global revenue in 2017. There is a high demand for digital signage as an effective way to communicate with customers as well as to provide digital experience in brick-and-mortar stores. Digital signage is used in the in-store display videos, ads, or messages, which need to be conveyed to customers for improving engagement. As a result, visual marketing is anticipated to dominate the market throughout the forecast period.
The others segment, which includes analytics & robotics, is likely to post the highest CAGR of 25.3% during the forecast period. Increasing adoption of analytical solutions by retailers to understand their customers, improve business operations, augment profitability, and have a competitive edge over their competitors in both physical and e-commerce retail is contributing to the growth of the segment.
Furthermore, the potential use of robots for providing in-store customer service is estimated to boost the growth of the overall smart retail market. For instance, Pepper, developed by Softbank, is driven by Artificial Intelligence (AI) technology. It can chat and interact with customers, answer their questions, and give directions, which can help in improving in-store customer engagement and experience.
On the basis of solution, the market has been bifurcated into hardware and software. The hardware segment dominated the market in 2017, accounting for over 68.0% of the overall market. Growing deployment of RFID, Bluetooth beacon, POS systems, and AR & VR devices to provide a seamless in-store shopping experience to customers is supplementing the growth of the segment.
The software segment is estimated to expand at a noteworthy CAGR during the forecast period. Burgeoning adoption of analytics software by retailers to understand specific customer needs and behavior to improve customer engagement and the shopping experience is one of the key factors stimulating the growth of the segment.
The market in North America was valued at USD 3.93 billion in 2017. The region is expected to be the leading revenue contributor in the market throughout the forecast period. Strong presence of smart retail solution providers and heightened adoption of advanced ICT technology in the retail sector are poised to augur well for the growth of the regional market.
On the other hand, Asia Pacific is projected to emerge as the fastest-growing region in the market during the same period. Increasing deployment of smart retail solutions such as shopping guide robots, reception robots, intelligent dressing mirrors, and big data analytics in countries such as China and Japan is anticipated to stoke the growth of the regional market. For instance, Alibaba Group, an e-commerce giant in China, introduced its new retail concept by opening the Hema Supermarket, which is a fine integration of online and offline shopping. In Hema stores, similar to the cashier-less stores, Amazon Go, shoppers use their Alipay phone application to make payment for food.
There is intense competition in the market owing to the presence of a significant number of market players. Some of the prominent companies operating in the market are Intel Corporation; IBM; Samsung Electronics; Amazon; Google, Inc.; Microsoft Corporation; Softbank Robotics Holdings; Ingenico S.A.; Verifone Systems; NCR Corporation. Currently, players in the market are pursuing both inorganic and organic growth strategies to increase their market share.
For instance, NCR Corporation announced Horizon, a data-driven self-checkout consultancy and web-based analytics system for the retail sector. This consultancy analyzes data generated at self-checkout to provide actionable insights to retailers to improve store operation and checkout experience for customers.
Report Attribute |
Details |
Market size value in 2020 |
USD 19.3 billion |
Revenue forecast in 2025 |
USD 58.2 billion |
Growth Rate |
CAGR of 23.9% from 2018 to 2025 |
Base year for estimation |
2017 |
Historical data |
2015 - 2016 |
Forecast period |
2018 - 2025 |
Quantitative units |
Revenue in USD million/billion and CAGR from 2018 to 2025 |
Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, and trends |
Segments covered |
Solution, application, region |
Regional scope |
North America; Europe; Asia Pacific; Latin America; Middle East & Africa |
Country scope |
U.S.; Canada; U.K.; Germany; China; India; Japan; Brazil; Mexico |
Key companies profiled |
Intel Corporation; IBM; Samsung Electronics; Amazon; Google, Inc.; Microsoft Corporation; Softbank Robotics Holdings; Ingenico S.A.; Verifone Systems; NCR Corporation |
Customization scope |
Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope. |
Pricing and purchase options |
Avail customized purchase options to meet your exact research needs. Explore purchase options |
This report forecasts revenue growth at global, regional & country levels and provides an analysis of industry trends in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the global smart retail market report on the basis of solution, application, and region:
Solution Outlook (Revenue, USD Million, 2015 - 2025)
Hardware
Software
Application Outlook (Revenue, USD Million, 2015 - 2025)
Visual Marketing
Digital signage
Smart Label
Smart beacon
Smart shelf
Smart Payment System
e - payment system
Mobile Payment application
POS system
Intelligent System
Augment reality
Virtual reality
Smart carts
Interactive kiosk
Others
Others (Robotics, analytics)
Regional Outlook (Revenue, USD Million, 2015 - 2025)
North America
The U.S.
Canada
Europe
Germany
The U.K.
Asia Pacific
China
India
Japan
Latin America
Brazil
Mexico
MEA
b. The global smart retail market size was estimated at USD 15.8 billion in 2019 and is expected to reach USD 19.3 billion in 2020.
b. The global smart retail market is expected to grow at a compound annual growth rate of 23.9% from 2018 to 2025 to reach USD 58.2 billion by 2025.
b. North America dominated the smart retail market with a share of 35.8% in 2019. Strong presence of smart retail solution providers and heightened adoption of advanced ICT technology in the retail sector are poised to augur well for the growth of the regional market.
b. Some key players operating in the smart retail market include Intel Corporation; IBM; Samsung Electronics; Amazon; Google, Inc.; Microsoft Corporation; Softbank Robotics Holdings; Ingenico S.A.; Verifone Systems; and NCR Corporation.
b. Key factors that are driving the market growth include growing incorporation of technologies such as augmented reality, virtual reality, artificial intelligence, and IoT to improve store operations, facilitate accurate inventory management, and enhance consumer’s shopping experience.
This report has a service guarantee. We stand by our report quality.
We are in compliance with GDPR & CCPR norms. All interactions are confidential.
Design an exclusive study to serve your research needs.
Get your queries resolved from an industry expert.
"The quality of research they have done for us has been excellent..."
Artificial Intelligence (AI), Virtual Reality (VR), and Augmented Reality (AR) solutions are anticipated to substantially contribute while responding to the COVID-19 pandemic and address continuously evolving challenges. The existing situation owing to the outbreak of the epidemic will inspire pharmaceutical vendors and healthcare establishments to improve their R&D investments in AI, acting as a core technology for enabling various initiatives. The insurance industry is expected to confront the pressure associated with cost-efficiency. Usage of AI can help in reducing operating costs, and at the same time, can increase customer satisfaction during the renewal process, claims, and other services. VR/AR can assist in e-learning, for which the demand will surge owing to the closure of many schools and universities. Further, VR/AR can also prove to be a valuable solution in providing remote assistance as it can support in avoiding unnecessary travel. The report will account for Covid19 as a key market contributor.