What are the opportunities the connected home (and workplace, and automobile) offers brands and advertisers to connect with consumers. What are the pros and cons, and what will be the breakthrough that makes IoT as ubiquitous as the smartphone?
With everything becoming smart and connected it’s easy to see why the industry is getting increasingly excited about the opportunities offered by IOT (Internet of Things). The value of the global smart homes market is expected to reach $58bn by 2020, yet only 14% of UK homes are currently connected. This presents a huge opportunity for brands and advertisers to get ahead, and assert themselves as dominant players.
In 2015 the world’s largest consumer electronics show (CES) in Las Vegas showcased connected devices as a core theme. This year we saw an explosion of connected and smart devices. I remember standing at CES, not knowing where to turn next. The list was endless: smart light switches, light bulbs, home security systems, connected cars, driverless cars, cars with assisted driving, cars that parked themselves, smart fridges, self-ordering washing machines…
However, we are yet to see mass adoption. Sure, it’s great I can track my energy but do I care? Am I excited about switching the heating on from my mobile phone on the commute home? Or my washing machine? Not really. The application so far has been “mechanical” and hasn’t reached a stage where I’d say it is truly “connecting” consumer marketing. There is no human need to fulfil when we control our heating. My existing thermostat already does this. The human need and desire is already answered sufficiently by most connected devices and in some cases the technology even adds extra steps.
That’s not to say there aren’t great uses today and that the technology is not incredibly smart. Samsung bought SmartThings, which is positioned to be the hub device across many operating systems to help make the home smarter. The founder built it after a burst pipe caused devastation in his home. He invented technology that could alert himself and his plumber so that the issue could be fixed immediately, rather than hours later. Add other use cases and this concept scales to make our homes safer. Lights, burst pipes and burglars aside there are 15 million households with pets in the UK, according to Deloitte. As a pet loving nation, we spend £1bn on pet insurance and £3bn on pet food annually. Connected home technology could be a massive assistance in caring for our pets. But niche areas are not the focus for most brands in this space. Instead the market is looking for a way to turn connected devices into another smartphone revolution.
We’re at a crossroads where the technology and adoption is not advanced enough to make us really want it. Back in the day the mobile phone was just for making calls. It was capable of a little data storage and texting but that was it. As the data network capacity increased, phones could pack more memory and processing power and the app world was born. The smartphone changed the mobile phone industry. The phone has morphed into our companion, our surrogate brain that reminds us about appointments, connects us to people, allows us quick access to information and at times allows us to play.
The next thing that makes connected devices as successful as smartphone will be assistants such as Alexa, Google’s Allo, Cortana and Siri. In my opinion, Amazon is in the lead with its Amazon Echo and Alexa technology. Already a strong and loved brand through its superb shopping and customer service experience, Amazon has built out its echo system to offer just about any service from books and goods to video, music and now as the connector of anything through Alexa. As voice recognition improves and personal assistants complete more tasks, we will see connected device technology leap into the mainstream. Currently it’s cute that you can select songs, make basic orders or understand weather patterns, but soon all of us will use this technology to get the machines do the work for us. Alexa has already increased its “skills”, now able to complete 3,000 tasks, up from 1,000 in June of 2016. As we upgrade our home appliances we will keep adding to the usefulness of such devices. Soon, we’ll be coming home to a cooked meal with the lights dimmed ready for us to watch a cued movie.
What assistants do well is reduce friction, they take speech to save you time typing or even opening your phone. The Amazon Echo with its Alexa voice recognition seamlessly fits with our daily routines. So, if Alexa and the like are so clever in learning from us and making suggestions on our behalf, where are the opportunities for brands to be part of these suggestions? How can brands still connect with consumers and not be shut out by smart systems designed to finetune to our likes and suggest what other people also like?
We live in a cluttered world with increased data, automation and smart technology. This means brands need to work hard at meeting human needs and desires and tap into this evolution. The most successful brands today do this well. To ensure brands connect with consumers in the future they will need to excite curiosity and disrupt routines positively with their brand experiences through their products and communications. The data explosion will allow many businesses to transform from product-led to service-led businesses reading which features of their products are being utilised, helping consumers get the best out of them and also improving product and brand experience. These brands will deliver more benefits by allowing smart systems to connect with their audiences in a relevant, timely, meaningful and smart way.