The Internet of Things is coming to commerce and may have an attractive value proposition for consumers.
A new report suggests that connected devices can reduce the friction of transactions for consumers and therefore increase purchase volumes in commerce.
As a result, IoT will contribute to the future evolution of e-commerce, according to Javelin’s 2016 Online Retail Payments Forecast.
E-commerce has experienced a shift from desktop to mobile-driven commerce.
Last year, mobile accounted for almost a third (29%) of online retail. However, mobile-commerce will grow to almost half (49%) within the next four years, according to Javelin.
The growth in mobile commerce has come primarily from retailers and merchants developing their services around mobile features to make transactions easier for consumers. For example, one-click checkouts, which automatically add billing and shipping information into the designated fields when a consumer is checking out by phone, play to the fact that typing all that information on a smartphone can be somewhat laborious.
Completely eliminating that step of the checkout process has made m-commerce more fluid for consumers and is a driving force behind higher purchase volumes, according to Javelin.
Similarly, IoT has the potential to further increase purchasing efficiencies with connected commerce devices, such as Amazon’s highly publicized Dash button, which enables a consumer to order household supplies by pushing a single button, the report suggests.
IoT in commerce doesn’t just mean physically facilitating a purchase, however. Other connected devices in retail, such as beacons or even LED lighting, can enable brands and retailers to provide contextually-relevant marketing messaging to consumers, which can positively affect buying behavior.
After receiving mobile marketing messages from a retailer, 32% of consumers visited the retailer’s website and 29% made a purchase last year, according to the report.
In addition, more than 42% of consumers said they would share their location if it meant receiving discounts.