We are at the beginning of another explosion in information applications. This one is being driven by small, intelligent sensors that can precisely measure and communicate stuff like temperature, position, movement, light and chemical traces. These, connectable sensors are reliable, manageable and affordable enough to be within reach of both businesses and consumers.
This entire sensor universe (and its associated infrastructure) is referred to as the Internet of Things, or IoT. It is, in essence, a new type of platform with astounding breadth and complexity. According to industry research firm Gartner, by 2020 there will be a staggering 26 billion of these connected objects, more than three times the number of smart phones, tablets and PCs combined.
Early adopters are already using the IoT to deliver valuable new services. Major vendors seeing another internet-size opportunity have begun laying the cloud foundation for the impending gold rush. For me, I like to think about the IoT combined with powerful mobile devices and fast, anytime/anywhere networks. Now that is a platform that can cause some serious economic disruption across many industries!
Some businesses are delivering solutions that are much closer to what their customers actually want. For example, rather than sell you an air conditioner, I can now sell you a service that keeps your building between 68 and 72 degrees year-round, or warn you of an impending heart attack. Other businesses are using the IoT platform to become dramatically more efficient. Why stockpile unnecessary material when my partners can now precisely monitor my consumption and increase or decrease delivery as required? Turbo-charged supply chains. The possibilities are astounding.
The effect on marketing will be staggering. Let’s take a look at just one important activity: connecting with qualified buyers, what is referred to in marketing as targeting. A large portion of marketing dollars is wasted when the wrong offers are made to the wrong people at the wrong place and time. Better information about the buyer fixes this problem and gives businesses like Facebook and Google, with their vast warehouses of user data, the ability to command top-dollar for their advertisements. The IoT will generate an enormous, truly unprecedented amount of precise information about buyers and their needs.
It’s a marketer’s dream come true. And it is easy to see how, with all this additional data, the IoT will have a dramatic impact on both the economics and performance of targeting.
Better targeting means new market opportunities for services. Many of the problems IoT entrepreneurs will go after will be recurring in nature, so I expect the IoT will continue to drive the growth of recurring revenue businesses across multiple industries. Better targeting also gives vendors the ability to more precisely price and package their wares. More agile vendors will take advantage of this to expand into new markets, or steal market share from competitors.
This is great news for us at Aria, as we are focused on helping customers implement sophisticated monetization strategies and adapt them to go after new opportunities. As we have seen with past technology waves, there will be many new options for marketers. The next few years should be very exciting indeed! I’m looking forward to the ride.
– Jon Gettinger