Product Managers & Marketers: What The Internet of Things Means For You
Some of you may be reading our series on the Internet of Things and wondering: what use is this to me in my daily work? So one day my fridge will be able to tell me when the milk has run out, when I travel my luggage will have an RFID tag and not be lost, my home will be automated via Twitter. But none of this affects my job - does it? Well, no. But the world of Internet-connected objects will impact your work life as much as your home life.
If you're a product manager, marketer, or simply part of a business that revolves around products (yes, things), read on to find out how this will affect you.
When commercial products are connected to the Internet, it will introduce a whole new range of functionalities and marketing possibilities. We discussed this with Tim Berners-Lee, the inventor of the Web, back in June. Using the scenario of a household phone, Berners-Lee explained how it can connect to the Web with a simple URI (i.e. link):
"I can give a URI to my phone [...] also the company that made it can give a URI to the model of the phone. They can also put online all the specs of the phone, and then I can make a link to say that my phone is an example of that product. So now any system which is dealing with me and has access to that data will be able to figure out the sorts of things I can do with my phone, which actually is really valuable."
That scenario from Tim Berners-Lee was mostly from the consumer's point of view, but manufacturers and retailers can also do interesting things with their Internet-connected products.
Track Usage - Mmmmmm, Marketing Data!
If a product is connected to the Internet then (theoretically at least) you the manufacturer and/or retailer can track the consumer's usage of the product. The phone will probably have an RFID chip, which then connects to the Internet and enables a two-way link between you and the customer.
As a product or marketing manager, think of all the great user data you could get from that RFID tag! Some of the things you may be able to find out:
- How often the customer uses the phone
- Average time they spend on each call
- What features of the phone they use the most
- Were they use it most (in combination with location sensors perhaps)
- Who in the household uses it (and the times they each use it)
By the time this kind of product usage tracking is possible, privacy laws may have evolved. But even if that's the case, you the producer may easily be able to cut deals with lots of consumers - give us all that data, you may say, and we'll shave 10% off the price!
Brand Management
Brand management also becomes richer if the product is connected to the Web. Ever heard of personalization? It's been promised in the world of marketing for a long time. But up till now it's just been your customers connected to the Web - on Twitter, Facebook or other social media sites.
However when your products are connected to the Internet too, it could give you a mountain of data about your customers. That is, the usage data mentioned above combined with what your customers are saying on Facebook, Twitter and so on. This will allow you to very tightly target marketing messages to the customer based on how they use the product, what features they use, where they use it; together with what features they're saying they want on social networks. You may even be able to get fairly accurate demographic data about the customer, allowing you to filter social networks more granularly.
Another possibility is cross-promoting other channels: we notice that you use the phone a lot in your home office, have you seen our new fax machine?
Software as a Service
So far we've discussed how Internet of Things could benefit product or brand managers. Here's something that can benefit everyone: the software in a consumer product can be automatically updated over the Internet, as soon as there's an update. You'll recognize this functionality from web 2.0: any software that runs on the Internet can be upgraded for the user at any time, centrally by the company. It's one of the advantages of Google Docs over Microsoft Office, for example.
In the phone scenario, perhaps there's a brand new answering phone feature that you the manufacturer has just invented. You could easily add this feature to all of the phones whose hardware supports it, using the Internet. Perhaps the feature is accessed over the Web on your servers, or it may be downloaded onto the device itself. The customer is perhaps alerted to the new feature by a message on their phone when they wake up (if they choose to be alerted). So innovation is passed onto the customer very quickly - everyone wins, except your competitors!
Customer Service
Customer service will be revolutionized by Internet of Things. As manufacturer or retailer, you can troubleshoot problems via the Web using precise details from the customer's product, fix software bugs in real-time, pinpoint any issues with the phone perhaps before the customer has even noticed, monitor how the phone performs against its warranty, pass on tips for phone usage based on how the customer uses the phone, and much more.
Conclusion
When products are connected to the Internet, it will open up a whole new world of commercial possibilities for manufacturers and retailers alike. As with most other Internet of Things scenarios, there will be privacy and usability issues to overcome. But producers of products can rub their hands together with glee at this future!
We've just scratched the surface - let us know in the comments your ideas and thoughts.
Flickr photos: KB35; tuxmentat; Aaron Landry; .A.A.
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My wife and I have been geeking out on the Microsoft Tag stuff using them at our jobs & house. When you can link a physical object to the web, you're able to give it a "bill of materials" so to speak. Lots of interesting possibilities!
Number of reasons why this will never happen:
- If a product is connected to the Internet then (theoretically at least) you the manufacturer and/or retailer can track the consumer's usage of the product. The phone will probably have an RFID chip, which then connects to the Internet and enables a two-way link between you and the customer.
So long as marketers keep seeing consumers as just sales targets to be used this will fail. I don't read ReadWriteWeb so that I can be marketed to. I read it for its content. SImilarly, I buy a fridge to keep my perishable food cool not be tracked not to provide marketing data to the manufactuer.
- I don't befriend consumer product companies on Facebook nor do I read their twitter spam
Have you heard of Seth Godin? Go read one of his books.
Khurt, the post outlines what is in it for the product / marketing people. Of course I've heard of Seth Godin, but that's not what this post is about.
p.s. the purple cow will have an RFID chip in it.
Great article, thanks
Well, this is actually a very practical solution to having to worry about your things. Privacy MIGHT be an issue, but I'm sure there are going to be ways to resolve it once everyone realizes the potential of this idea. Just my 2 cents in. http://AppUseful.com
I think there are lots of fundamentals to be worked out before we get to this commercial application stage in earnest.
I wrote a comic-book story about the Internet of things type future Mousetrap 2.0, which was published in a Springer lecture notes in computer science volume.
The big fundamental thing to work out here (and the point of the story) is the tension between the technical need for close OS/hardware integration because non-generic h/w devices need a lot of localization, vs. short-sighted use of that need to create closed SaaS/appliance systems. Until that tension is properly worked out, this revolution could be stillborn.
Venkat
Well I hope NMN is correct because I find all this very exciting and scary.
funny, I was thinking of the same things too. :)
regarding tags, I used to imagine what if time will come we need to attach tags to ourselves in order to find each other or so we could fall into our exact categories. scary thought huh?
but it's happening, all those integration tools.
This is not the future, it's happening now. My company (Axeda) has over 100 product manufacturer customers that use our software to provide services to connected products over the internet. Examples include Diebold (ATM's), EMC (Storage), Varian Medical (Cancer treatment equipment). Benefits to mfg's include reduced cost of service and increased revenue through expanded services. Benefits to customer include reduced product downtime and better performance.
Our customers are primarily in the B2B world, but we are seeing more interest in the B2C world as well. If you would like to hear more about our customers and technology, let me know.
This article really seems to be a great post!This sounds to be very interesting and very informative.
Thanks for this post!
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A year or two ago, it seemed we didn't have much sense for what the future will hold on the web, but our understanding is starting to be less imaginative, and more realistic - Augmented Reality, RFID, and an extended, available web are all believable components of the near-future. It all seems to be the next wave, once we all get over talking about social media all the time.
Standardization/Localization, as mentioned above, seems to be the biggest likely impediment.
One company that is extending the advantages of Web 2.0 is Rosetta Stone, with their latest product TOTALe. This version of their language learning product is all online (nothing new there), but has more than just their standard software, it includes an online environment for language learning games and online language practice classes as well.
Not only does moving this product online help them keep the product fresh, it helps them better monitor how people learn a language, and specifically, how they learn a language online.
Cool stuff, indeed.
Hi Richard,
Since RWW is taking an ongoing interest in blended reality topics like Internet of Things, can I suggest a couple of things?
1. Be more careful with technology jargon. For example, an RFID chip is an identifier that requires an active RF reader. It doesn't really "connect to the Internet and enable a two-way link". I understand your point, but your audience may not always know the difference.
2. Balance the enthusiasm with a more critical stance. For example, privacy and security are big unresolved issues for IoT and ubicomp in general, and marketers ignore them at their peril. You mention privacy in passing, but it can be a big deal for product folks. Just ask Intel about chips that "phone home", and see Katherine Albrecht's campaign about RFID and privacy.
You have a great platform for popularizing the ideas of web squared, AR, and the physical/digital web. Big world-changing ideas need less cheerleading and more insightful analysis, which I know you can deliver. Just my 2 cents, YMMV as always.
-gb-
Thanks Gene, points noted. In this post I did gloss over privacy and security, as it was focusing on the potential. But in future posts will explore those things more.
This is a great road map to help crystallize thought around the "Internet of Things".
I can say with experience that the SAAS component is going to create massive change in the product world. My company makes glucose meters and test strips for people with diabetes. The economics of the industry are such that meters are given away and as a result product costs are kept low. The products are distributed by doctors or retailers and manufacturers have little knowledge of what features are used or perceived as valuable except what can be gained via focus groups or surveys. Relative to other consumer electronics, innovation occurs at a relatively slow pace.
We just released a iPhone app that provides all of the functionality of a meter and new things that only an iPhone could enable. In the last week it has been downloaded, reviewed, and new functionality has been suggested. Now instead of waiting years to release a new product we can update it in a matter of weeks. This flexibility allows us to create better products for patients and innovate more quickly.
The "Internet of Things" by way of the iPhone, has changed the way we think about products. It totally upends preconceptions about economics, customer relationship, etc. I am excited to be working in this space and even more so to be a consumer in what will inevitably be a revolution in product design.
Thank you for posting this informative article.
Nice article, recently read the UK version of WIRED and they had an interesting related feature article by David Rowan on "the new hidden persuaders" relating to the use of RFID and other tracking technologies for future marketing data opportunities (and thus opens up new can of related consumer trust/privacy/permission issues)
http://www.wired.co.uk/wired-magazine/archive/2009/06/features/the-new-hidden-persuaders.aspx
would be curious to hear your thoughts on it...
Can you imagine knowing that your refrigerator communicated through your home wireless connection to GE data on how many times per day you open it, what temperatures you keep it at, and how many years it has been in service?
If you're like me, you would find the 802.11 card in the fridge and rip it out. Unless...by keeping the fridge "talking", GE agreed to send you a coupon for a free gallon of milk once a month...
My point - customers are willing to share marketing data, but there usually must be an incentive involved. Just think about grocery store VIP discount cards. You trade your shopping data for savings.
Interesting point of view. Particularly on the Software as a Service side. It has been around for some time, in the mobille industry and also in the software industry. But it now seems to have a more fundamental impact in the way we use the Internet as more and more killer apps (word processing, spreadsheets, project management) are becoming available under the SaaS model. Its also being referred to as Cloud Computing. Wikipidia defines Cloud Computing as a style of computing in which dynamically scalable and often virtualized resources are provided as a service over the Internet. See my blog on http://www.webjam.com/marketing_20 to see how Cloud Computing is impacting the social media and marketing landscape.
Is "Were" in "Were they use it most (in combination with location sensors perhaps)" "Where"?