If you aren’t yet familiar with the term Internet of Things or “IoT,” it’s time you get caught up. While the basic concept of IoT has been around for a long time (think ATMs connecting to bank servers back in the 70s) its importance in our daily lives is going to grow dramatically in the coming years and it’s already happening today. Smart phones are an obvious driver of growth here, but IoT expands to everything from smart cars and highways to smart coffee makers and watches.
The analyst firm Gartner projects that by 2020 there will be over 26 billion devices connected to the Internet of Things. Andy Hobsbawm, the CMO of EVRYTHNG, says: “By our calculations, close to a trillion products shipped annually will be digitally-capable in some form by the end of this decade.”
So what does this mean for marketing, and how can you capitalize on this inevitable transformation?
Advertising as a Value-Add
We’ve talked a lot recently about the disappearance of disruptive advertising and the importance of creating compelling brand stories. IoT goes one step further by connecting directly to an individual audience the instant they need you. Big data allows us to see trends, predict user behavior, and target marketing more effectively, but IoT allows us to pinpoint it.
Imagine a single woman uses the Nest thermostat, has a smart coffee maker, and a self-driving car. With access to this data, a marketer can know when she usually wakes up, leaves her house, and how long she usually sits in traffic. This information can be used to send highly specialized advertisements at exactly the right moment. With IoT, those ads can come in the form of emails, push notifications, or even a reminder from your coffee maker to pick up more filters on your way home. Maybe your car is low on wiper fluid and you suddenly receive a coupon for wiper fluid at a gas station just a few miles ahead.
When IoT can provide exactly what consumers need the moment they need it, CTRs will improve dramatically and marketing will become the opposite of disruptive.
It’s important to note that while this kind of targeting is something that marketers have long dreamed of, it’s something of which consumers are still wary. With IoT it is critical to recognize the line between providing a valued, customized service and invading a customer’s privacy.
The Disappearance of Dissatisfaction
While attracting new customers is the cornerstone of every great marketing campaign, keeping your existing customers happy is an equally (if not more) important part of your business. In the past, a dissatisfied customer could write a letter or call your 1-800 number. With the advent of social media and review sites like Yelp, issuing a complaint is only a few keystrokes away. But with IoT the process has the potential to become almost effortless for the consumer. Many home goods will have the capacity to diagnose an issue and fix it without any interaction at all. After all, the best customer service experience is one that never has to happen.
If there is a need for interaction, IoT streamlines the process. If the compressor on your fridge is about to die, you may not notice until your milk starts to curdle. But your smart refrigerator can anticipate this issue before any problems arise. It can send a new compressor (or a new fridge) straight to your door, or send a notification to schedule a service visit. One or two clicks can replace 45 frustrating minutes on hold with an automated phone system.
From a marketing perspective, this “hands-free” customer service offers the ability to let your customers (and your refrigerator) advertise for you. Brand loyalty is more important now than ever before and finding brand evangelists to sing your praises from social media can have a far deeper effect than traditional advertising. Consumers are already primed to start tweeting with vending machines, why not their refrigerators?
Redefining the Purchase Journey
One of the most practical applications of IoT for marketing is the ability to precisely target a consumer’s place in your sales funnel. While traditional and digital marketing will still make data driven decisions to entice new customers into the purchase journey, IoT can relay information about any product interactions a customer has had.
You know when a customer has clicked on your ad, but you can also utilize geo-location tools to know when they are entering your store and send a coupon for a free sample. The product can then be powered by smart tags to tell you when its been opened so you can deliver helpful tips or offer discounts for complementary products. Knowing each and every step in the customer journey offers marketers an unparalleled opportunity to capitalize on consumer impulse the moment it strikes.
Embracing the IoT Network
The possibilities for IoT are endless. More and more people are upgrading their homes and even their bodies with smart technology. People are eager to be connected and their expectations for what smart devices can provide will continue to grow. With all of the integration we will be seeing, businesses need to partner with one another to create better, more useful experiences for their customers. Whether or not your company sells any kind of physical product at all, it’s time for you to start thinking about how to use these integrated experiences to improve the overall customer experience.
IoT offers the possibility to engage with customers on a level far beyond shareable content and resonant storytelling, but there isn’t a one-size-fits-all answer for IoT marketing. The new landscape will be defined by finding dynamic solutions to problems that people don’t even know they have yet.