IoT in eCommerce: Technologies Change the Industry

IoT eCommerce

Imagine you have to buy new headphones, what will you do: go to the nearest store or open a browser or jump on your mobile app? More and more people today tend to choose the second variant since it takes less time and effort. The number of online-shoppers will keep growing, as e-commerce — online commercial transactions — becomes more comfortable by introducing high-tech solutions, for example, IoT-based.

IoT (Internet of Things) is an ecosystem of smart devices that have access to the internet and can communicate with each other. IoT changes the eCommerce industry not only from the consumers’ side but also from the inner one. (e.g., processes like inventory management, logistics.) The changes IoT brings to the e-commerce industry are both positive and negative.

How IoT Changes E-commerce

Even before going online, commerce utilized intelligent devices to improve service and product monitoring: it was 1982 when Coca-Cola installed smart vending machines that reported how much drink was left inside and how cold it was. Today, with the power of the internet and IoT, commerce has gone far ahead.

IoT in E-commerce: positive effects

Let’s begin with the e-commerce processes that benefit from IoT technologies.

Inventory Management

The IoT sensors and RFID (Radio Frequency Identification) tags revolutionized the way inventory is organized. They allow getting all the important product information (like product types, availability, expiration dates, and others) without human intervention. For customers, it means the possibility to see whether the product is available right now. While for business owners, it helps to monitor the quantity and quality of the product. For example, sensors check if the temperature in the warehouse is low enough for perishable products and warns the system if it is not.

The introduction of smart shelves has pushed inventory management even further. They monitor the number of goods and can reorder them when needed to avoid running out of stock.
These all cut down the risk of human error and the number of the working hours required.

Supply Chain Management

Tracking the journeys of the product has never been so accurate and detailed. With the help of IoT sensors and RFID tags, you always know what happens to the product: where it is, how fast it travels, under what conditions it is stored, etc. It allows calculating arrival time more accurate and avoiding losses or misdeliveries.

It also works well from the customers’ side: they can always make several taps at the mobile phone to see where their shipping is and how soon it will get to their doorstep.

Maintenance, Warranty, and Theft/Loss

IoT technologies are also perfect tools for remote monitoring of a product, for predicting its maintenance and analyzing performance. It provides business with more information about how the product is used and allows predicting and preventing break-downs. If the sensors report the poor functioning of a product, the company can call the customer and suggest repairment or replacement before the customer faces serious difficulties.

Another useful option of implementing IoT is the opportunity to find things if they are lost or stolen. We bet, at least once, you have forgotten an umbrella or jacket at a cafe or friend’s house. What if, after moving 500 meters away from your stuff, you got a notification like “it seems that you have forgotten your umbrella at the Martin’s?” Let’s admit, convenient. A decade ago, we did not expect our fridges to reorder milk and eggs, so why not have small smart sensors at clothes or other things by the year 2030?

Smart Homes

Here we should remember Amazon’s dash buttons that simplify routine tasks. These small buttons can be placed anywhere in the house and programmed through mobile apps to perform some actions. For example, you can to reorder washing powder or five packs of your favorite cookies by pushing one small button.

One more attribute of IoT in smart homes that businesses should take into account is voice assistant. People with such a device prefer not to browse for things they need. They command the voice assistant to buy them. But the problem is that the assistants are likely to order the same product for all the people with the same request. It means that some brands can get thousands of orders and huge revenues while others will be ignored. To avoid the latest, brands have to adapt their marketing companies not only for search engines but also for AI algorithms.


The more business knows about a particular customer, the more personalized experience and approach it can provide. And it effectively converts into loyalty and revenue growth. Having information from smart home devices significantly broadens the business’s opportunities. For example, if someone’s microwave oven consumes too much energy, you can send them an ad of your new economy model that saves energy and money. The same works for mobile phones, which communicate with lots of other devices around the users. Therefore they are a perfect source of information helping companies to draw detailed portraits of their customers.

Insurance companies are already using IoT-empowered smart devices (like GPS, movement, and speed sensors) to track people’s behavior and driving habits. The personal approach here implies discounts for careful drivers and higher rates for those who like exceeding the speed.

IoT in E-commerce: adverse effects

Just like everything else, the utilization of IoT in e-commerce has its dark side. Let’s take a look at it.


Automatization of the processes leads to an increase in unemployment since machines now do the job. The more people have no jobs, the lower purchasing power becomes. So, enterprises might save money but lose consumers.

Data Security Issues

Data security issues are still a weak point of IoT smart devices that are not related to security (like smart locks or smart home security systems). Since these devices have access to personal information, the risk of insecurity is a critical moment to consider.


Even though IoT-based solutions gradually get more accessible and cheaper, still not all companies can afford them. Only huge game players with high incomes can take full advantage of it and get far ahead of their smaller competitors. It means the survival and development for small and middle businesses become even more complicated.

IoT Trends in E-commerce: What Is Next?

All the mentioned above methods of utilization of IoT technologies in the e-commerce industry will keep growing, but let’s highlight the most promising trends.

Dron delivery

In 2016 Amazon first introduced shipping delivery using drones. It might be not so popular right now. But soon, more and more companies will offer drone-empowered same-day delivery to provide a better customer experience.


As we have already mentioned, security issues take place quite often. While IoT technologies are becoming more and more adopted, the need for proper data protection will grow. So, IoT data security solutions development can be a perfect basement for a business strategy.

Mobile phones

Probably, there is no other device that stores more personal info than a smartphone. Searching for the most effective ways to use this information treasury might become one of the key goals of any business in the e-commerce industry.


The most critical IoT benefit to take into account is the automation of business processes. It helps to save money and time, to provide better customer experience, and to manage everything more effectively.

Another essential thing to consider here is collecting data about your customers and the market. Missing the opportunities to know it better might be a dangerous mistake for any business, especially for a customer-oriented company like e-commerce. The best advice here is to consider the development of IoT-based software solutions, such as, Industries IoT — focuses on mobile apps and other ways to collect customers’ smartphone data.

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