In industrial manufacturing, machine-to-machine communications allows sensors in one place to communicate with control systems for an automated response.
For example, if the temperature in a commercial food processor reached a critical high, a sensor could send that information through a supervisory control and data acquisition system. In response, the control system could trigger a cooling system to bring the temperature down. No human interaction was necessary and plant operations sailed along without any downtime.
To allow these communications, devices had to be connected to each other and to larger systems using standard protocols like wifi, Bluetooth and Zigbee. These systems are referred to as the industrial Internet of Things (IoT).
While the industrial IoT got an earlier start, the consumer IoT is not far behind and it is going to be big. Really big.
Reimagining the Point of Sale
Using many of the same underlying technologies, the consumer IoT gives merchandisers a whole new perception of what ‘place’ even means in the multi-channel universe. Coffee makers, laundry machines, fridges, stoves, cars, watches, smart home monitors and many other items will become customer touchpoints.
The consumer IoT ushers in an era of personal, contextualized selling opportunities, allowing companies to place purchases right into the context of when and where people use an Internet-connected device. Say for example your company manufactures refrigerators. When the milk runs out, people can simply push a button on the fridge to reorder more. The milk can be delivered alone, or along with other commonly ordered items on a standard grocery list – all sourced and delivered by your local grocery partner.
If you manufacture almost any product, now is the time your organization should consider supporting this kind of transaction – right from the product itself.
Manufacturers are Doing it Already
Samsung’s new Family Hub refrigerator is one of the early entrants in the consumer IoT. The Family Hub comes with what looks like a tablet screen on its front door. Built-in apps connect to various services through the home WiFi network. To keep your fridge supplied, two apps let you order food directly from the screen. Instacart, a US national online grocery delivery service, will deliver to your front door in under an hour. Groceries by MasterCard lets you order online from leading retailers like Fresh Direct and ShopRite.
There are also three webcams inside the fridge. They take a photo of the contents when one of the doors closes. So if you’re at the store and can’t remember whether or not you have milk, you can look through the smartphone app to check.
GE has been adding functionality to get more out of their appliances, connecting their washers, dryers and dishwashers to more than a hundred other applications including Facebook, Twitter, smart lighting, and various other smart home products.
Millions of New Customer Touchpoints
Basically appliances are going to be more software intensive and connected. Consumers will be able to buy “apps” for their washing machines, which means they could actually change the things it can perform. Building connectivity into products allows companies to communicate with customers in new, meaningful ways.
Send them alerts on their coffee maker each month reminding them they need to descale their machine. Provide the details of the procedure to make it easy. Send them discounts and coupons they can take advantage of right from the machine.
It’s not just appliances either. No matter the industry, businesses everywhere will need to adapt to the changing demands of consumers due to the consumer Internet of Things. Thinking about the extended ecosystem required to allow the consumer Internet of Things to flourish, there are a couple of classic technology pain points that companies are going to have to address.
Handling Multi-Channel Commerce
From a brand and customer experience point of view, selling through multiple channels—in-store, online, through a mobile app, via Facebook—presents challenges enough. Now think about how your back end commerce systems might handle the sale of food items from a local grocer via your refrigerator interface.
These kinds of transactions make commerce and transaction systems even more complex – and they must feed information to back end systems of record like CRM and ERP. If you thought that the integration effort was ridiculous when there were only five channels, think about it when you add even just ten internet-connected products and thousands of people buy them. The challenge here is to ensure that the commerce system you choose moving forward is capable of adding new sales channels without the massive integration efforts of the past.
Buddy Up or Go Vertical
From a partnership perspective, the consumer IoT opens massive new opportunities. Who are you going to partner with to sell coffee from your coffeemaker? Which brands in which cities will you support? Or will the coffee arrive via UPS or Fedex from a central location?
If you are a car manufacturer and the tire tread detector senses they need replacement, do you recommend the factory choice? Or spread the love to other tire manufacturers? When the car alerts a driver to the fact that they need more gas and drivers search for a nearby station from their car interface, do you promote all brands equally?
Depending on how brands work together, the consumer IoT might be the driver for mergers due to attractive economies of scale resulting from vertical integration.
More and more consumer devices are being connected. The IoT gives marketers a whole new perception of what ‘place’ even means in the multi-channel universe. Think about how your products might fulfill customer wishes to make their lives easier. Then build that service right into your products.
With the right underlying back-end commerce platform, adding new channels is easy, so the only limitation is your imagination and your ability to conceive of your products in a booming consumer IoT.