To understand how Forrester’s predictions will unfold in the retail industry in 2020, my colleague Madeline Cyr and I interviewed experts within Forrester for our “Applying 2020 Predictions To Retail” series. To understand the internet of things (IoT) predictions for 2020, we spoke with Forrester IoT expert Frank Gillett.
Madeline Cyr: In 2020, you predict consumers will embrace smart speakers and displays. What challenges and use cases do you see for in-store adoption of these technologies?
Frank Gillett: A significant number of US consumers (especially those with money to spend) already are using smart home devices and virtual assistants. Forrester estimates that over 250 million smart home devices will be installed in US homes by 2021. In stores, we have seen a few examples of sophisticated IoT devices at retailers. For example, Walgreens has been experimenting with IoT-enabled displays on refrigerator doors that use face detection technology to show ads based on approximate age and gender. Overall, though, we won’t see mass adoption of sophisticated IoT experiences at retailers this year.
Madeline: What are some of the most exciting IoT developments in logistics and supply chain that retailers should know about for 2020?
Frank: In 2020, we will see growing capabilities in cold chain monitoring for temperature-sensitive grocery and pharmaceutical goods. These devices are attached to the truck, pallet, or cargo. This essentially gives “source to store” information to make sure that perishable items are maintained at ideal conditions during transit. Usually this information centers on temperature but can also include readings for humidity, light exposure, or vibration. These trackers are getting more specific to not only give truck information but also provide real-time information specific to each cargo pallet.
Madeline: You noted also that IoT devices might be vulnerable to ransomware targeting the IoT device manufacturers. How should retailers go about managing third-party risk of in-store IoT devices?
Frank: When it comes to IoT devices, retailers are susceptible to attacks orchestrated directly against the retailer as well as upstream attacks that target the manufacturer. You need to vet the cybersecurity chops of the IoT device makers and the risk they pose to your brand. Currently, the IoT devices in store are typically not customer-facing but rather things like smoke detectors, doors, air conditioning, and alarms. You can see how these devices could pose huge problems if they were hacked. For instance, a hacker might lock your doors or set off alarms until the ransom was paid. Make sure your security and risk team is doing due diligence on all the building and infrastructure IoT components within your store, as well as the device manufacturer. As stores put in place more IoT cameras and beacons, they will need to evaluate the risks these pose, as well.