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How Will the Internet of Things Impact Business?

How Will the Internet of Things Impact Business?

By Jessica Bennett We are living in the age of the Internet of Things (IoT). It’s not just our phones, tablets, and computers connected to the Internet anymore. Now our cars, thermostats, refrigerators, doorbells, and light switches can act on their own or on our command no matter where we are. IoT

By Jessica Bennett

We are living in the age of the Internet of Things (IoT). It’s not just our phones, tablets, and computers connected to the Internet anymore. Now our cars, thermostats, refrigerators, doorbells, and light switches can act on their own or on our command no matter where we are. IoT gives people unprecedented control over the objects in their lives, but that’s just the tip of the iceberg. IoT is also dramatically affecting the way businesses function, the products and services they provide, and how they interact with their customers.

Welcome to the Age of IoT

Coined in 1999 by the technologist Kevin Ashton, the Internet of Things refers to the “growing network of physical objects that are connected through the Internet and communicate without human interaction,” according to the Information Technology Association of Canada. IoT goes far beyond computers and smartphones and refers to everyday objects that are increasingly finding their ways into our internet-connected lives. If you rely on your Tesla to update its own software, check your Ring doorbell app every time someone knocks, or turn on your home’s Nest thermostat when you leave work, then you already live in an IoT world.

You are not alone. In the year 2000, 200 million devices were connected to the Internet. In 2020, that number is now an astounding 34 billion. And yet, this is only the beginning. IoT is still in its infancy, and as it continues to grow, businesses need to pay close attention to the benefits and opportunities the IoT can offer.

One of the greatest opportunities is the massive amount of information IoT devices produce: approximately 2.5 quintillion bytes per day. Businesses that tap into this big data source can streamline their internal processes, engage their employees more efficiently, and proactively serve personalized products to their customers. In fact, organizations are planning to spend $1.3 trillion on IoT initiatives in 2020.

Here are just a few ways businesses can (and are) using IoT to stay ahead of the competition.

Improve Inventory Management and Tracking

Keeping track of inventory can be a big hassle, but it’s worth the effort. Your call centre and sales team need to know what’s available so they don’t make promises to customers they can’t keep. You also want to know what’s moving so you can order replacements more efficiently. Large companies already use high-tech tracking equipment and software, but IoT allows even small companies to keep on top of their inventory, and that information is accessible to everyone in the company.

IoT can also make it easier and more affordable for your logistics team to track even the smallest shipments. Smart sensors provide crucial information so your team can actively manage your inventory in real time.

The Epic Fruit Company, based in South Africa, needed to ensure that its oranges, peaches, plums, and other fruit products arrived crisp and delicious to its customers around the world. Using new sensors made by MOST, Epic Fruit tracks the temperature, location, and other data for all its containers. Managers can review all this data in a continuously updated dashboard and use that information to make decisions on the best times, routes, and seasons to send their products.

Cut Waste and Improve Efficiency

Waste and inefficiency are a reality for every business and act as an invisible drain, sucking away time, energy, and profits. With its ability to gather and track every bit of data, the IoT can give businesses the ability to review their systems on a much more granular level in order to find and eliminate waste. This may be as focused as tracking how far an employee has to walk to the copier each day, or as broad as installing smart thermostats that save thousands a month by only heating and cooling rooms where employees are working. A smart thermostat could even track a company meeting calendar and heat a conference room ten minutes before a meeting starts.

A great example of cutting out waste comes from Atlas Global Solutions. After it opened a new 200,000-square-foot manufacturing facility in the U.S., the company’s leaders were dismayed by their energy bills. An energy audit showed that the facility was burning through 1.3 million kW hours of electricity per year. By installing a smart LED lighting system from Digital Lumens, Atlas slashed its energy usage by more than half. Not only did the company save big on its energy bills, but it also earned an award from Energy Manager Today.

Proactively Monitor Your Equipment

Equipment downtime can be extremely expensive for you and your customers. For example, General Electric found that a single day of downtime at a natural gas platform can cost up to $25 million. As a result, GE invested $1 billion to add sensors to its most valuable equipment, including gas turbines and jet engines, so it could discover issues before they caused equipment to malfunction.

By tracking your equipment or adding sensors to your products, you can effectively monitor their performance and catch problems before they occur. This can help you plan for repairs at your own facilities and, best of all, fix your customers’ equipment before it breaks. Your customers will be thrilled.

Greater Customer Engagement

Gathering data on customer usage helps companies provide a more tailored customer experience, discover new ways to connect with customers, and even upsell relevant products and services to their most receptive audiences.

The Kilchoman Distillery was looking for a new and powerful way to connect with its customers and to stand out from the 126 other licensed Scotch distilleries in the country. The 124-year-old distillery worked with Thinfilm to create near-field communication labels on its bottles. These “smart tags” allow customers to tap their phone against the tag to pull up all sorts of information about the scotch in their glass. They can review tasting notes, learn about the distillery’s history, and check out videos of the farm distillery in action. Kilchoman can also analyze tapping activity to find out where interest is strongest, which can help them better target their marketing dollars.

New Customer Capabilities

IoT doesn’t just make the customer journey better. It can give customers entirely new capabilities they didn’t even know they wanted. This allows companies to connect with them on a deeper level and leverage that connection to sell more products.

One of the best examples of an IoT product creating a demand is Amazon’s Echo smart home device. The Echo, along with Google Home, can connect to all of an individual’s smart devices, allowing them to control everything from their lights to their locks with a quick vocal command. It also doesn’t hurt that the device has an answer for nearly every verbal question and can play your favorite album on command. Amazon has used its Echo products to further increase its market share. Customers can easily use their Echoes to order whatever products they want — all from Amazon, of course. According to a study by Infoscout and Alpine.AI, households increased their spending on Amazon by 29 per cent after purchasing an Echo.

Solving Problems

At its core, IoT helps businesses solve existing and future problems in new ways. The possible uses for IoT are nearly endless. As a last example, nonprofits found that one of the challenges in providing vaccines to children in the poorest parts of the world was an unreliable electric grid. Many vaccines need to stay refrigerated in order to work. Weka and Microsoft teamed up to create an IoT-enabled smart vaccine refrigerator that delivers alerts to providers when the temperature inside the fridge begins to fluctuate. The refrigerator also tracks the storing and dispensing of vaccines, making it easier for providers to get vaccines to the children who are most in need.

How to Incorporate IoT in Your Business

Today’s businesses should look at how they can incorporate the Internet of Things into every customer experience, as well as in their own internal operations. It’s not enough to simply create capabilities and gather information. Businesses must also use that information and provide actionable data across their organization, from the CEO all the way through to their customer service representatives. So far, this isn’t happening: Even while IoT generates 2.5 quintillion bytes per day, less than one per cent of that information is actually being used.

Don’t let the IoT and all the information it produces go to waste. Use it to develop your business’s IoT capabilities or streamline your existing products and systems. Connect products and experiences and capture relevant data from billions of events per day. Use IoT to glean the information you need to better serve your customers, create new demand, improve the efficiency of your business, and solve your biggest logistical challenges.

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