Retailers looking to capitalize on Internet of Things (IoT) technologies will spend an estimated $2.5 billion in hardware and installation costs by 2020, nearly a fourfold increase over this year’s estimated $670 million spending, according to a new report from Juniper Research.

The hardware spending includes Bluetooth Beacons and radio frequency identification (RF ID) tags. Bluetooth beacons enable asset visibility as well as the ability to push relevant information to consumers’ smartphones. And RFID can help provide real-time asset tracking, reduced labor costs and dynamic pricing based on stock levels and online pricing.

The new research found that leading retailers using the IoT are poised to gain market advantage and capitalize on the opportunity, Juniper says. Linking the hardware elements of RFID tags, beacons and connected consumer electronics, such as wearables, with software analytics can deliver in-depth business insight and an enhanced customer experience, it says.

Retailers such as Zara and Target are already taking advantage of the benefits offered by RFID asset tracking,” Steffen Sorrell, research analyst at Juniper and author of the report, said in a statement. “Meanwhile the beacon industry is expanding rapidly; used as a method to provide consumers with contextually relevant information in conjunction with their smartphone or wearable will enormously enhance the in-store experience.”

The report says 70% of IoT units are expected to be composed of non-consumer devices by 2020.

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