Smart Retail – Perfect recipe of AI, IoT and Robotics!!

The retail industry caters to the need of consumers across the board and continues to be largest and most attractive industry segment globally comprising FMCG, Apparel, Fashion, Electronics, Quick Service Restaurants, Entertainment, etc. As per Statista[1], retail sales worldwide touched USD 25 trillion in 2018 and projected to grow to USD 27.7 trillion by 2020. The retail industry is going through a transformative phase enabled by mobile technology, omnichannel strategy, advancements in modern retail outlets, the emergence of new retail business models, online commerce, doorstep services, customer analytics, a convergence of digital technologies, etc.

Artificial Intelligence, Internet of Things (IoT) and Robotics are the three key and important pillars to enable smart and connected retail industry for all the stakeholders such as but not limited to:

  • retail service providers who own and manage retail stores or online commerce
  • retail product builders such as FMCG companies or companies producing retail goods
  • logistics and transportation companies who form the backbone of retail supply chain
  • financial technology providers such as POS, payment gateways, mobile wallets
  • customer interface and experience providers such as retail applications, last mile touch points

I define IoT as an ecosystem of interconnected objects that enables a multitude of devices to share information using sensors and then analyze that data using applications thereby making the system effective and efficient for an end user.

Retail robot with the direction to ice cream aisle[2]

IoT, when combined with artificial intelligence holds the potential to generate immense value for the customer by leveraging the strength of machine learning and deep learning models to work on the data captured by the sensors leading to building insights or identify trends, which were not possible before. As per various research analysts, there would be billions of connected devices by 2020 and may touch a trillion in a near future where everything from kitchen appliance to a car and from factories to ports would use IoT, AI, Blockchain, AR/VR and other technologies. Robotics is the field where the application of various fields of engineering such as mechanical, electronics, IT and computer science come together to create an intelligent machine that is driven by motors, sensors, cameras, and other technologies to replicate human actions or processes.

While smart retails is a much larger umbrella, we will limit our discussion to the smart retail store and understand how a retail store is enabling the convergence of AI, IoT, and Robotics. Amazon GO store, which promises to be a completely autonomous retail shopping experience from the time you enter the store, pick the product, drop into your cart or bag, check-out at the counter and pay, basically your end-to-end experience has limited human interaction or the need to scan the barcode. As per Amazon[3], the store uses several technologies, including computer vision, deep learning algorithms, and sensor fusion to automate much of the purchase, checkout, and payment steps associated with a retail transaction.

Lenovo[4] has built and is operating autonomous and un-manned retail stores in China with a capability that cover entire retail shopping experience with the limited need of manning the store except for re-stocking the goods, which can potentially be automated as well in the future .

  • Tracking Customer Movement: Customer who wishes to enter the store need to scan the face at the turnstile if first time then system registers the customer otherwise face recognition technology identifies an existing customer and let them enter the store. So facial recognition and AI can track customer movement within the store throwing recommendations on the screen about offers and promotions.
  • Validation & Payment: Customer picks up the water bottle, which has a barcode attached to it, the customer then moves to the checkout counter, where the barcode is scanned, validated and screen renders cost, product details, and payment options. WeChat is a most popular wallet in China, so customer can just pay using WeChat QR code.
  • Smart Shelves: Shelves where the product was picked up from records the inventory and item just sold through a combination of weight sensors and video analytics and updates the product item count there by enabling real time inventory management.

As we can see sensors, RFID, Barcodes, AI, Image processing, Computer Vision, and integration with the store ERP system enables end-to-end autonomous experience for the store. Store size is small hence there is no need of directions but in a typical large retail outlet – robots can play a crucial role to guide the customer, act as tellers, secure the environment from thefts, enable customer services or simply an information kiosk.

Conclusion: While we have not touched on how these technologies are or will work together and what are the challenges that may arise to integrate and make them work smoothly as well ensure customer data privacy and security, what we have learned in this article is why smart retail is potentially a huge opportunity worldwide that will create a whole new experience for the customers. Smart retail will enhance customer interaction and interfaces, enable faster turnaround time for shopping and make the whole process seamless. Future of retail is very promising where the shopper can try 20 dresses[5] in a matter of few minutes than standing at the changing room queue and IoT, AI; Robotics with other digital technologies is going to make it possible.



  1. Retail sales worldwide by Statista
  2. Image source of retail robot with the direction to ice cream aisle
  3. – Amazon Go
  4. Lenovo Autonomous Retail Store – Beijing, China
  5. – Smart Mirror

– By Vinay Solanki, Head IoT (APAC & MENA)Lenovo


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