TECHNOLOGY is enabling marketers to innovate at an incredible rate.
The focus is around the Internet of Things, where small smartchips are allowing almost any device you can think of to be connected to the internet; your kettle, your tennis racquet, your car, your TV, your kitchen cupboards, your front door, your toothbrush, your pets and even your light globes. And that’s on top of your smartphone, smart watch, tablet and laptop.
But the essence of marketing is not to invent for invention’s sake, it is to create products and services that meet people’s needs. So why are marketers so excited about the Internet of Things? Ever had that nagging feeling that you didn’t lock the front door when you left home? With a lock connected to the internet, you can now double check and lock it via your mobile phone. Forgotten where you parked your car in the multi-level carpark at the shopping centre? Your connected car reminds you. Wish the kettle could turn itself on when your alarm goes off each morning? Tick. Down at the supermarket and struggling to remember what you need? Ask your connected fridge.
There are close to five billion connected devices around the globe, and this is expected to grow fivefold in the next five years. Not only is that an enormous amount of desired products that marketers will have put into consumers’ hands, but it’s also generating an unprecedented amount of interconnected data about those consumers. For marketers this is the real gold.
If you’re a creature of habit who wakes and reads the news on your iPad before having a coffee and some toast, expect to see some ads for Nescafe and jam in among that news site you are reading. When those smart light globes are 80 per cent through their life, expect to receive a coupon on your phone to order some new ones. Play tennis every Wednesday night? Expect to receive a push notification for 20 per cent off tennis gear if you pass a major sports store that day.
For marketers it means that ads will be very closely aligned with consumers’ behaviour, and therefore ad spend wastage will be kept to a minimum. For consumers it means ads that are going to be relevant and of benefit to them the majority of the time.
The initial investment dollars into the Internet of Things are huge. The Chinese government is talking $600 billion over the next five years. Cisco and Intel are also backing it in a big way. Cisco’s CEO is calling it the “second generation of the internet”. And earlier this year Intel launched its chip, which is flat and about a centimetre in diameter and includes a sensor, processor and radio.
In the car space, Google and Apple have been investing to enable smartphones to be better used via the car dashboard, and in late 2014 Nokia announced a $100m fund around connected cars. McKinsey estimates that the market for connectivity and services in cars will be more than $250m within five years. Not only will this advance in technology enhance the driving experience, it will also enable cars to be run more efficiently and safely.
The pet category is another area of interest for marketers beginning to make use of the internet of Things. In Australia, every cat and dog already has a microchip embedded under the skin for identification purposes. And with the size of the smart chips reducing quickly, it won’t be long before these take over from the current microchips, enabling lost pets to be found easily. Researchers in north Wales have already been trialling this type of technology, with flocks of sheep. And Whistle, a US start-up, has created a successful collar for dogs and cats to track their activity, much like a FitBit.
The interconnectivity of the data will also enable marketers to be far more responsive through a customer’s path to purchase. The connected fridge or wine rack knows when your stocks of sauvignon blanc are low. Google search data also picks up on your recent searches for that wine type. And social media listening tools highlight an issue with the delivery of a recent wine order from a particular winery. Your smartphone’s GPS data knows when you are near a liquor store. And your TV, desktop, tablet and mobile are primed to have ads and emails served on them in the timeslots that you’ve been more prone to buy wine online in the past. If you instead decide to phone to order, the call centre is primed to pick up the conversation around that wine type immediately.
This year’s Consumer Electronics Show in Las Vegas showed that the Internet of Things is now a reality. Marketers are already making their initial plays in how best to use the connected technology. Some are very focused on the product itself, such as the connected tennis racquet that can analyse every shot you make during a match. Others are almost willing to give away the connected device in order to improve their data and understanding of that customer. Either way, it’s an exciting opportunity for marketers.