The “Internet of Things” (IoT) is rapidly becoming one of the most popular emerging technologies in business and society. Using empirical data from a multi-national online retailer who adopted an IoT technology that largely automates the consumers’ purchases and utilizing a quasi-experimental framework, we study the effect of the introduction of IoT as an alternative sales channel on product sales. Our analyses reveal a statistically and economically significant increase in sales and demonstrate the business value of the IoT channel for retailers and brands. Besides, we conduct additional analyses of the IoT effect to delve into the effect heterogeneity and empirically validate the underlying mechanisms by examining the impact of IoT for products in different price ranges, levels of substitutability, and different product categories. This is the first paper to study the impact of an IoT technology on product sales, drawing important implications for devices and technologies largely automating the purchase process.

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