Wednesday, April 30, 2014

The Internet of Things: The $300 Billion Opportunity for Marketers

If consumers are going to be inundated with Internet of Things-based products and services, it presents an opportunity for marketers. Consider these examples of how the megatrend is impacting our lives and businesses.

Internet Of Things (IoT) - three powerful words that will change our world, so I was told at a recent digital marketing conference. Having seen the "next big thing" movie before, I decided to delve deeper into the megatrend and decide for myself the potential impact on our lives and more importantly, the world of marketing.
The term "Internet of Things" was proposed almost 15 years ago by Kevin Ashton, who envisioned physical objects could connect to the Internet and communicate with other devices on the network. However, the concept was introduced by MIT, as an extension of machine-to-machine and person-to-person communication.

The world moving beyond standalone devices into a hyper-connected ecosystem may have seemed like a pipe dream 15 years ago. However, the rapid proliferation of Internet-enabled devices has made this pipe dream a reality.
The Internet Business Solutions Group at Cisco predicts approximately 25 billion devices will be connected by 2015, and 50 billion by 2020. Fifty billion connected devices (smartphones, thermostats, refrigerators, traffic lights, and heart monitors) represent a huge opportunity for every area of business. In fact, a Gartner report suggests, the IoT devices worldwide sales are forecasted to top $300 billion by 2020.
It is hardly surprising that a recent Economist Intelligence Report suggests that the biggest impact of the IoT is expected to be on customer service and products. Therefore, if consumers are going to be inundated with IoT-based products and services, it presents a unique opportunity for marketers in general and digital marketers specifically.
I have elaborated a few ideas and examples below to get you thinking about how this megatrend will impact our lives and businesses:
1. Networked Cows: A Dutch start-up company called Sparked allows dairy farmers to implant wireless sensors in the ears of cattle. This allows farmers to monitor cows’ health and track their movements, leading to healthier animals and thus higher yield of dairy and meat.
2. Smarter Homes: We find grocery shopping incredibly boring and time-consuming. Imagine having connected household appliances that let us know when we've run low on certain groceries and even place the order for us based on our purchase history and marketing offers! For those of us with allergies, the IoT offers an elegant solution. The new Honeywell Bluetooth-enabled Air Purifier talks to your smartphone's Internet connection to monitor allergy reports and adjusts the cleaning level to keep your allergies under control. Therefore, the smarter home is a potential goldmine for both white goods and CPG marketers.
3. Personalized ShoppingRetailers like Amazon have revolutionized the retail space with a more immersed online retail experience. IoT will usher in the second wave of retail with an integrated online and offline shopping experience. With IoT and smart analytics, it is possible to have customers enter a brick-and-mortar store and be guided to their favorite products based on online search histories and past purchases. Consequently, this presents a unique opportunity to find out in real-time about how, where, and why our products are being purchased and used, thus allowing us to customize our marketing efforts and improve ROI.
4. De-Congested Roads: Smart devices that can gather this data and supply it back in real-time, are a key enabler for monitoring traffic. A great example is from TomTom, the GPS manufacturer that publishes a report called Congestion Index. The congestion index measures road congestion as a percentage difference when compared to normal traffic. The Congestion Index, represents the time taken to travel through a city with the normal amount of traffic, a very useful metric for those of us who spend a lot of time in our cars fighting traffic.
In conclusion, IoT is already revolutionizing our lives and businesses. The list of organizations adopting IoT is steadily increasing with early successes to show. So what are you waiting for?

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