Is the IoT inevitable or overblown?

By Lisa Lacy | n/a

August 9, 2016 | 9 min read

There’s a tendency among digital marketers — and digital marketing publications — to talk about the Internet of Things, or IoT, as if widespread adoption is inevitable. And, to be fair, this may very well be the case. We could certainly be looking at a future in which we put on connected clothes in our connected homes and drive connected cars to connected jobs and monitor our connected children, pets and refrigerators from afar.

However, broadly speaking, digital marketers tend to be a more tech-savvy crowd than, say, the average consumer who does not own a Nest Learning Thermostat and who has never spoken to Alexa. Which is not to say this consumer lives a sad, meaningless life — or that she or he will never know the joy that is a Zeeq Smart Pillow — but rather despite the promise IoT offers brands and consumers alike, mainstream consumers won’t necessarily drink the Kool-Aid, too.

In fact, Drew Ianni, chairman of the IoT Influencers Summit, pointed to Geoffrey Moore’s book, Crossing the Chasm, as proof new technologies with strong hype and early adopters can still die in the “chasm" because they struggle to gain mass market awareness.

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That’s not to say the IoT is doomed, but rather we should perhaps take off our rose-colored IoT glasses for a moment and take a more objective look at the burgeoning industry.

Ask digital marketers if the IoT is inevitable and you’re virtually guaranteed to hear, “It’s already here.”

And they’re not wrong. IT research and advisory firm Gartner forecasted 6.4bn connected “things” will be in use in 2016 — and nearly 21bn by 2020.

At the same time, it’s not simply a numbers game and the question remains what must happen in order for these connected devices to reach critical mass — which includes middle America. And your parents.

Chicken. Egg.

For his part, Ianni said technology adoption is always a chicken/egg scenario.

“You have a great product but no mass awareness or distribution [and] you can't get the distribution until you have a critical mass of customers,” he added.

This was true in mobile in the not-so-distant past when Apple launched its App Store, but had the advantage of a rapidly growing base of users thanks to the iPhone, Ianni said.

“Apple and developers essentially needed each other in the beginning as the App Store needed great apps and developers needed the Apple distribution and commerce platform to monetize their products,” Ianni said. “It was a rare perfect storm of mutual dependency from the outset, which is rare when such a platform, technology and/or ecosystem launches.”

Further, Ianni said lack of applications for IoT devices remains an issue and there is yet another chicken/egg conundrum across different IoT business ecosystems.

“Of course, as with any paradigm shift in technology, there will be a litany of failures on the path to transformation as people apply old world thinking to new capabilities,” added Jake Bennett, CTO of digital agency Pop. “But although there hasn’t been an iPhone-level success story in IoT yet, it would be a mistake to ignore the inevitability suggested by the long-term trends.”

Said another way, your parents figured out Facebook eventually, so there’s hope.

The "Holy Grail" of IoT

What’s more, many consumers who recoil in fear upon hearing, “Internet of Things,” likely encounter it every day even if they don’t realize it.

Case in point: Dave Evans, CTO of consumer IoT company Stringify, pointed to billions of connected devices that already surround us, like traffic lights and energy grids.

And Jeremy Lockhorn, vice president of emerging experiences at interactive agency Razorfish, used Delta’s plans to add RFID to bag tags to improve the handling of checked luggage as another example.

“In that case, the end users may or may not even know that their bags are connected,” Lockhorn said. “And they may not care — they’ll just know that their bags are going to arrive with them.”

In addition, Thomas Walle, CEO and founder of proximity network Unacast, cited a vehicle from Tesla that can download its own updates and schedule appointments for repairs.

“That’s super IoT, but the customer doesn’t see it as IoT – it’s just something there to help our lives become easier,” he said. “It works in the background. That’s the holy grail of IoT.”

'All sorts of weird, useless shit'

And that is perhaps the most important takeaway — and one that is not lost on digital marketers. In fact, another common refrain was, “Just because you can make a connected device, doesn’t mean you should.”

The so-called smart market includes connected trampolines, swimwear, forks, diapers and more. But should it?

Jacek Grebski, partner at digital agency Swarm, likened this smorgasbord to products sold via infomercials — while Erik Walenza-Slabe, CEO of IoT One, a platform that says it is “devoted to accelerating adoption of industrial Internet solutions,” called the consumer IoT sector the “class clown” of IoT.

“Anyone who's been awake at 3 A.M. watching network television can attest to the fact that people will make, produce and try to sell all sorts of weird, useless shit,” Grebski said. “The same can be said for IoT…but, on the other hand, you have tons of smart home applications, from vents to thermostats…to smart innovations in energy grids…to consumer-grade products like…health devices that can detect blood sugar levels.”

In other words, mainstream consumers should come around eventually.

Consumers won’t buy IoT simply to buy IoT

But it also means the market needs time to separate the proverbial wheat from the chaff.

Per Manolo Almagro, senior managing director of innovation and retail technology at retail marketing agency TPN, this process will take roughly three to five years, but as AI and natural language processing are integrated, speed will accelerate as consumers will expect increased convenience and utility.

“The issue at hand is…figuring out which IoT solutions are actually solutions — that is, serving a purpose for making our lives better and allowing us to be more efficient with our time and energy,” said Bahman Zakeri, CEO and chief strategist at digital agency Xivic.

Jarrod Bull, head of accounts at digital marketing agency iCrossing, noted brands are “throwing innovation darts at the wall in some cases to see what sticks” in IoT.

“It will be those that don’t really interrupt what we’re doing and improve our everyday lives that will be the ones that are here for the long haul,” Bull said. “So many ideas are being tested right now, but across so many technologies and platforms that it’s going to be incredibly difficult to connect them and get value from them all. So many are also unnecessary and appear to offer no real value…but for some the value will eventually become clear and others will fade away or fail.”

In the end, marketers have to understand consumers won’t buy IoT simply to buy IoT, Zakeri said.

“They’re looking for solutions to problems and that’s what we have to focus on. We should leverage IoT only if it proves more value to our customers or our companies,” he said. “IoT is a tool, not a product. Engineers should keep an eye on technology trends and adopt those that enable better, cheaper and faster solutions for our customers. In short, IoT is for creating opportunities for more direct integration of the physical world into computer-based systems with the result being improved efficiency, accuracy and overall economic benefit for all.”

Further, Bull noted while connected TVs, light bulbs and security systems make life better for many consumers, these products are expensive and full-scale adoption won’t take place until prices to come down.

Walenza-Slabe agreed the cost of sensors, connectivity and data analysis have a significant impact on the price of otherwise dumb products that doesn’t always justify the additional cost, but technological advancement and economies of scale will drive costs down while improved performance and reliability will drive the value of IoT enablement up over time.

Per Mishel Alon, senior director of product management at advertising company Jun Group, IoT technology is also hindered by lack of common communications standards that would allow devices to communicate with one another effectively. Moreover, he noted many of the big players in this space like Google and Apple prefer to keep their devices within their own ecosystems in order to maintain control.

A security nightmare

And let’s not forget that with more connections comes the potential for more breaches.

“Yes, the data collected can help bring efficiency to our lives, but in the wrong hands it can lead to disastrous situations, especially with industrial IoT, such as industrial tools, heavy machines, jet engines, drills, transportation systems, oil rigs, hospitals, financial systems and even warfare tools and robots,” Zakeri said.

Search marketing expert Ryan Jones agreed it's potentially a security nightmare — particularly among less tech-savvy consumers.

“I can't get my parents to update their browser or operating system,” he said. “There's no way they'll update their fridge, thermostat or dog toy.”


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