Connected Retail Market Technologies, Applications and Regional Trends and Forecast to 2022
Global Connected Retail Market size was estimated at USD 11.17 billion in 2014. Technological advancements coupled with increasing numbers of IoT that is Internet of Things applications across the retail sector are estimated to drive the growth for the connected retail market. The industry has progressed significantly in the recent past due to numerous new technological advancements. Internet of things is the concept principally for connecting any device such as coffee makers, washing machines, wearable devices, cell phones, headphones, lamps, and several other things with an on & off switch for the internet connection. The technology is expected to generate opportunities in retail sector by providing advance fraud & theft prevention solutions and inventory management.
Moreover, it offers solutions to improve communication between customers and retailers. BLE that is Bluetooth Low Energy segment is estimated to witness positive growth in the near future due to a surge in installation and technology usage. Bluetooth low energy transmits less data for smaller distances and uses less power compared to Bluetooth. The marketing & retail payments verticals are more and more using BLE technology which is leading to customer loyalty, improved sales, and acquisition. BLE has increased customer engagement & marketing, in its application increasing contactless payments easier. Rapid drop in the components costs such as RFID sensors and tags has positive Impact on the industry growth.
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Declining RFID cost has increased the demand for RFID components across the retail segment to curtail fraud and theft. Issues pertaining to privacy & security and lack of standards related to IoT are estimated to hamper industry growth over the next eight-year period. Hardware segment ruled the connected retail market in the recent past. The segment had over 60% of the total market revenue share in 2015, due to the increase in connected devices proliferation at consumer & retailer levels. Furthermore, hardware growth is enhanced by IoT including communication chips and sensors. RFID amongst hardware components is projected to grow at over 23% CAGR.
Increase in RFID components adoption in retail owing several advantages they offer which include monitoring customer behavior, preventing theft & fraud, inventory management, and preventing loss. NFC technology is estimated to witness growth at a 22%CAGR due to increasing in cashless payments adaption in the industry. It has several advantageous properties such as security, versatility, and ease-of-use. Software segment is estimated to witness the positive growth with more than 24% CAGR over the eight-year period. Software segment is booming due to increase in number of IoT applications throughout the industry. Retailers are more and more adopting IoT to have more customers’ interaction and gain competitive advantage.
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Managed services sector is accounting for more than 40% in 2015, thus is estimated to witness positive growth over the forecast period. It reduces the repeated in-house IT costs and enhances the efficiency. It includes outsourcing the production support activities, support maintenance and lifecycle management activities among several others. As IoT in retail is gaining rapid adaption, retailers are continuously facing data safety threats. Thus, to manage the increasing data base, security, service providers invest heavily for disaster recovery and data protection solutions. The services for remote management devices are expected to grow at over 24%CAGR due to rapid growing remote devices adaptation at workplace.
This service provides security as it gives secure data access and thus prevents data misuse. North America is expected to dominate the connected retail market at global basis accounting for over 35% revenue share in 2015. Companies from this region, especially U.S. are investing heavily in IoT infrastructure, thus is estimated to drive the regional market growth over the next eight years. Asia Pacific region is projected to be a booming regional market and is estimated to grow at 25% CAGR over the eight-year period. Developing region in Asia Pacific such as India and China are expected to witness huge growth due to the increase in adoption of IoT.
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Key market players include Microsoft Corporation, Zebra Technologies Corporation, SAP AG, PTC, Inc., IBM, Cisco Systems, Inc., Softweb Solutions, Inc, NXP Semiconductors N.V., Intel Corporation, Google, ARM Holdings PLC and Atmel Corporation. Vendors are implementing strategies such as product innovation & differentiation by investing in research and development processes to gain advantage over its other competitors.