According to Fortune Business Insights, the global Smart Building market is projected to reach $328.62 billion by 2029, an annual growth rate of over 20 per cent for the next seven years. This equates to an estimated 45 million smart buildings this year to over 250 million by 2029 as demand grows for secure, energy-efficient developments. Currently around 90 per cent of smart building spending goes to non-residential properties. There is of course consumer demand for this technology as well, driven by rising environmental concerns and energy costs, along with increased time spent at home. But the lion’s share of smart infrastructure investment comes from the corporate world; particularly those with large estates and property portfolios.
The argument for smart building investment is clear:
However, there is another key benefit; one which few organisations are currently exploiting. This is using the resulting data more strategically – outside of energy saving and optimising the employee experience. Ultimately using store movement data to better understand customers and their behaviour to inform decision making and deliver tangible insights that result in new revenue streams or incremental revenue.
Conversion rate optimisation (CRO) is one of the most effective marketing channels, but often confined to online due to data availability and thus capability for experimentation. By applying the principles of CRO to physical stores, retailers can improve the customer experience, increase sales and gain valuable customer insights.
For instance, in a retail environment, it is possible for organisations to use their smart infrastructure, with camera and beacon technology, to:
Once decisions are made as to what activities should be monitored, it is possible to structure and map all the data sources to build models that define relationships such as correlating engagement data with conversion data. This can be enriched with additional organisational data, demographics and market share information, amongst others, to further identify relationships and data points. And finally, dashboards can be developed to enable ongoing consumption and implementation of the insight.
Employing your smart infrastructure to drive insight fills a significant gap. Industry is great at understanding customers before and after they enter stores, but knowing what they do on-premise has, until now, been more challenging. However, with the smart infrastructure (which can be funded by energy savings) it is now possible to answer questions such as:
And suddenly your smart infrastructure is delivering more value than its original purpose. Win-win!
As Principal Consultant at Beyond ESG, Danny Holmes is our data strategy expert, helping clients solve business problems with data, technology and pragmatic thinking.