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Leveraging Wearables for Smart Retail Pricing and Promotion


Written By: Gargi Sarma 


The retail sector is constantly changing in this age of digital transformation, with technology having a significant impact on how businesses and customers interact with one another. Smart wearables have become a game-changer among the many technological innovations. In addition to improving personal health management, these gadgets—which have sensors that track biometric data like heart rate, respiration, and activity levels—can also be used to inform smart retail pricing and promotional strategies. With the use of actual retail experiences, this essay explores how wearable technology is changing the retail environment.

Figure 1: The Global Wearables Market Is All About the Wrist


According to International Data Corporation (IDC), wrist-worn fitness trackers and smartwatches have been the main drivers of the wearable market's expansion. It is projected that 95% of wearables shipped this year will consist of these devices, and they will continue to dominate the industry until 2022.


Market Growth: According to Mordor Intelligence, the smart wearable industry is expected to reach USD 205.10 billion by 2029, growing at a compound annual growth rate (CAGR) of 19.48% from its estimated USD 84.23 billion in 2024. This indicates that consumer adoption has increased significantly.


Personalized Promotions Based on Health Data:


Retailers are using wearable device data more and more to create customized promotions. For example, companies like Nike and Lululemon are using data from wearable technologies into their consumer loyalty programs. These businesses are able to provide customers with personalized offers and product recommendations by evaluating biometric data. To increase the chance of a purchase, a merchant may give discounts on sportswear or running shoes if a wearable gadget, for instance, shows a high degree of physical activity.


Under Armour is a prime example, having created the "UA Record" platform. This software tracks exercise, sleep, and nutrition by syncing with many wearables. Through the utilization of this information, Under Armour is able to provide users with individualized training gear and nutritional items, along with deals and promotions that are in line with their activity levels and health objectives.


Dynamic Pricing Strategies:


Another cutting-edge strategy in the retail industry is the incorporation of biometric data from wearables into dynamic pricing plans. Real-time price adjustments are made via dynamic pricing, which takes into account a number of variables such as customer information, inventory levels, and demand. This technique gains additional depth from wearable devices, which offer real-time activity and health data.


Take Amazon, the leader in dynamic pricing. It is possible that Amazon may provide customized pricing based on a customer's activity level and lifestyle by integrating wearable data. For example, a customer who frequently goes camping or sports may be eligible for special offers on outdoor goods. By taking into account the demands and interests of the customer, this strategy not only increases sales but also improves the shopping experience.

Figure 2: Number of Connected Wearable Devices, Globally by Region, 2021 - 2022


Enhanced Customer Engagement and Loyalty:


Enhancing customer engagement and loyalty is another important function of wearable technology. Retailers can make shopping experiences more dynamic and interesting by utilizing biometric data. For instance, based on a user's stress level or sleep habits, which have an impact on skin health, Sephora's Beauty Insider loyalty program might use data from wearable technology to provide customized beauty advice and product recommendations.


Additionally, the purchasing experience can be made more engaging by using wearable data. Retailers can set challenges and provide prizes to clients who achieve their fitness and health objectives. Adidas , for example, has tested incorporating wearable data into its Runtastic app to motivate users to take part in fitness contests. Rewarding themselves with special product offers or discounts, successful participants develop a stronger bond with the company.


Walmarts Health and Wellness Initiatives:


One of the biggest retailers in the world, Walmart, has led the way in incorporating wearable technology into its business strategy. Walmart and Sharecare, a digital health startup, teamed in 2020 to give workers devices that track various health parameters. Although Walmart analyzes aggregated data to understand overall employee wellness trends, the data obtained also helps employees better manage their health.


This program benefits the workforce in two ways: it makes employees healthier and gives Walmart useful information about health trends that company can use to inform product offerings and marketing campaigns. Walmart may better serve its wider customer base by customizing its health and wellness product lines based on an awareness of the biometric data trends of its employees.


Example:


As they improve consumer experiences and operational efficiency, smart wearables are in fact changing the retail sector. Examples of how wearables affect promotion and pricing are as follows:


  1. Contactless Payments via Smartwatches:


  • Smartwatches enable seamless contactless payments, bypassing the need for physical wallets or smartphones.

  • Shoppers can make purchases directly from their wrists, enhancing convenience during in-store transactions.



Figure 3: Fitbit 4 Smartwatch


The Fitbit Versa 4 is a small, light fitness tracker that allows for instantaneous contactless payments and displays workout data.


  1. Personalized Marketing and Coupons:


  • Wearables collect data on user behavior, location, and preferences.

  • Retailers can use this information to push personalized marketing messages, targeted coupons, and special offers to potential customers as they approach stores.

  • This data-driven approach increases foot traffic and drives sales.



  1. In-Store Navigation and Assistance:



  • Smart glasses or AR-enabled wearables can guide shoppers within stores.

  • Real-time navigation, product recommendations, and promotional alerts enhance the overall shopping experience.



  1. Employee Efficiency and Inventory Management:



  • Wearables equipped with RFID technology help employees track inventory levels, restock shelves, and manage stockouts.

  • Real-time data ensures accurate pricing, reduces errors, and optimizes inventory.



  1. Health Monitoring for Staff and Customers:


  • Wearables can monitor employee health (e.g., fatigue levels, stress) to optimize staffing and ensure well-being.

  • For customers, health-tracking features can enhance personalized recommendations (e.g., suggesting energy-boosting snacks after detecting low activity levels).


Smart Glucose Wearables: Companies like Freestyle Libre continuously check blood glucose levels and give users access to real-time data. This data can be used to personalize offers and discounts through clever retail pricing and promotions. When a user's glucose levels suggest a need, a retail pharmacy, for instance, can use the glucose data from Freestyle Libre users to offer personalized promotions on products relevant to diabetes. Through timely and relevant marketing, the system can automatically provide discounts on insulin or glucose management tools if the patch identifies a tendency towards higher glucose levels. This improves customer service and boosts sales.


Figure 4: Smart Glucose Wearables


Smart Wearable Clothes: Hexoskin and Athos are two companies that have created smart clothes with sensors integrated into it to track biometric information like heart rate, breathing, and activity level. Personalized recommendations for exercise regimens and nutrition plans can be made possible by the insights this data can provide into users' health and fitness habits.


Figure 5: Smart Wearable Clothes


By incorporating smart wearable device data into their dynamic pricing and promotional startegies, retailers can get leverage from RapidPricer. Personalized, demand-driven pricing and promotions are made possible by RapidPricer, which uses real-time biological insights including heart rate, breathing, and activity levels. Retailers benefit from higher revenue and greater consumer loyalty as a result of this, which also optimizes inventory management and sales efficiency.


The Future of Retail and Wearable Technology:


It is anticipated that wearable technology will become more deeply integrated with the retail sector as it develops. More advanced biometric monitoring and smooth integration with augmented reality (AR) shopping experiences could be future innovations. Retailers might employ augmented reality (AR) to build virtual fitting rooms where biometric information from wearables is used to recommend the right fit and style for each consumer.


In conclusion, customized promotions, dynamic pricing, and improved customer involvement are made possible by smart wearables, which are revolutionizing the retail sector. The synergy between biometric data and retail strategy will probably grow even more prominent as stores like Under Armour, Amazon, Sephora, and Walmart continue to develop, resulting in more tailored and efficient shopping experiences.



About RapidPricer


RapidPricer helps automate pricing and promotions for retailers. The company has capabilities in retail pricing, artificial intelligence, and deep learning to compute merchandising actions for real-time execution in a retail environment.


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