CHICAGO—"The chatter people have between them is an enabler for you. You can listen in and encourage transactions," said James McQuivey, VP and principal analyst at Forrester Research, during Thursday morning's opening session at this year's IRCE.
McQuivey spoke about the importance of social media for retailers when it comes to listening to the needs and wants of consumers today. However, the analyst and author was more focused on the future, when the chatter becomes "machine to machine," as he refers to it.
"Machines chatter at a scale and velocity that billions of people on Facebook can't do," McQuivey said. He, of course, was talking about the Internet of Things (IoT), which he calls a "symptom" that reflects two bigger trends.
First, consumers are "hyperadopting." This refers to the rate at which people are scrambling to try technology and taking leaps onto products that are newly released, or not even released yet. He referred to it as "frantic," "nutty," and "very real." According to McQuivey, a Forrester poll taken on the first presale day for the Apple Watch found that 26 percent of consumers said they would eventually own a smartwatch, and some already had a preference for an Android or an Apple smartwatch—before they were even in consumers' hands.
Also trending is companies' engagement in digital disruption. With the way technology has erupted today, it is easier and easier for people to try new business models because it can be done more cheaply. As everyone is innovating and participating, more people are likely to adopt new advances and, therefore, speed up the rate of IoT.
"I want you to believe it and I want you to prepare for it," McQuivey said. By 2020, he predicted that the amount of data customers will give off every day will be 100 times the cumulative data that already exists in data warehouses today.
All of these devices are going to create the next massive set of available data. Today's estimate of 14.4 billion connected devices could balloon to more than 50 billion by 2020, according to trade group CompTIA.
"All of the data these things are creating gives us more insight into customers than ever before," McQuivey said. The next question for retailers is going to be what to do with all of the data collected from cameras, microphones, biometrics, motion sensors, environmental sensors and mobile, many of which are already available for purchase at retailers such as Staples (NASDAQ:SPLS).
It will be up to retailers to use this information to initiate relationships with consumers. Some will have the power to ask consumers to look into these sensors to get more data. Other retailers will ask permission to install these data-collecting sensors. And as McQuivey said, Google and Apple are already collecting this kind of information. Retailers need to think ahead and create the right partnerships to collect, analyze and develop services around the IoT.
"If I have data on what already makes [the consumer] happy, I'm in a great position to know what the next thing of value is," he said.
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