Levi’s And Intel Push IoT Beyond Smartphones

When most people bring up the Internet of Things, they are usually referring to new ways smartphones, tablets and other mobile devices can communicate with a wider network. However, if retailers want to create a web of communicable nodes that extends beyond the devices their customers bring into stores, the Internet of Smartphones has to truly become the Internet of Things.

For Levi’s and Intel, they’ve already taken the first step down that road.

Business Insider reported that while speaking at Intel’s IoT Insights event, CEO Brian Krzanich announced a partnership with apparel retailer Levi’s in which both companies would attempt to construct an ambitious proof of concept at one of Levi’s storefronts in San Francisco. By placing RFID tags on every single item on the shopping floor and feeding data through cloud-based analytics engines, Levi’s and Intel hope to create the retail industry’s first comprehensive IoT space where merchants can track everything from inventory status, to item popularity and even shopper movement.

“[Levi’s] now has the ability to power an application that lets them look at the whole store, holistically, every minute, and gives the employees the ability to scan of the entire store,” Krzanich said at the event.

So what does that mean for the bottom line? Krzanich didn’t share any financial information specific to Levi’s, but he did note that for every 3 percent jump in inventory accuracy, retailers can expect to see a correlating 1 percent bump in sales.

While improving inventory management through IoT strategies might seem appealing to some retailers, avoiding inventory inaccuracy can be just as important. A study conducted by GS1 US and Auburn University’s RFID Lab found that 63 percent is the average for inventory accuracy. The lower that accuracy falls, the more likely the retailer is to run into supply and delivery issues. Of course, mismanaged inventories and bare shelves can also lead to lost revenue, which is difficult to track but universally harmful to retailers’ financial well-beings. If Intel and Levi’s pilot IoT program can help even the least organized retailers claw their way above the 63 percent average, the savings from avoided inventory purchases could be massive.

Melanie Nuce, vice president of apparel and general merchandise at GS1 US, explained that IoT strategies through widespread RFID implementation – much like the Levi’s and Intel’s partnership – are gaining serious steam.

“After seeing the proven benefits of RFID in pilot programs, both manufacturers and retailers are realizing its many long-term business advantages,” Nuce said in a statement. “As industry collaboration and discussion grows, it will be difficult for companies to ignore RFID’s role as a critical enabler of inventory visibility and the seamless customer experience.”

RFID-enabled inventory management doesn’t have to be the only way retailers can improve in-store operations through IoT methods. In fact, Noah Treshnell, senior vice president of retail and global retail capabilities at Levi’s, explained in a blog post that the company also plans on providing IoT-gathered data on shopper behaviors to its growing number of in-store stylists.

“We’re interested in technology that is going to enhance and improve the consumer experience in our stores,” Treshnell said.

Neither Intel nor Levi’s said when the San Francisco storefront would be decked out with RFID tags. However, when all of the store’s items are outfitted and the switch at Intel is flipped, the changes could be massive – even if shoppers are none the wiser to the IoT revolution.