When the dial-up tone first signaled that the universe was ‘online’ in the early 1990s, the scope of the revolution that was about to take place was inconceivable. Within a remarkably short amount of time, the connection between people and the online universe encouraged unimaginable development, the likes of which the world had never seen. For businesses, the rapid flow of information and unlimited connectivity heralded a new age: the age of digital transformation. Solving problems for a new generation was essential. Connectivity and digitalization brought new tools and opportunities, and companies either flourished or failed.
Today, the age of connection is evolving, and a shift is underway. This time, we are seeing something that’s similar in many ways to the previous digital revolution, yet at the same time, fundamentally different. Before, the revolution was spurred by people connecting with digital information around them. Now, machines and devices are connecting with each other.
This machine-to-machine connectivity is called the Internet of Things, or IoT. And although we are still in the genesis of the IoT revolution, it’s clear that this stage of digitalization will once again have far-reaching effects on the success of countless businesses in every industry.
A Brief Introduction to IoT
IoT is a system of interconnected objects, devices, machines, products, and more, that can transfer data to each other, over a network, without human involvement. It starts with sensors that are embedded into physical objects to create a human like nervous system. Thanks to cameras, things that were once static, can now see. Thanks to microphones, things can hear, and thanks to pressure and heat sensors, they can feel.
These suddenly dynamic objects collect data relevant to a specific goal, and take steps to achieve that goal. Say you have an IoT powered underfloor heating system. The floor has pressure sensors embedded in it and can tell if people are home and walking around, or if the house is vacant. The floor autonomously collects information, and communicates with the thermostat to adjust the temperature and avoid wasting energy. That is a simplified example of how IoT machine-to-machine connectivity works. In more elaborate situations, networks process vast amounts of information, turn information into data, and apply the data to complex systems and processes to optimize decision making and increase efficiency.
IoT is transforming the world, and its potential to impact business is virtually limitless. IoT innovation provides increased value, improves services, and most importantly, disrupts traditional problem solving models. Therefore, businesses that are engaged in the digital future know that they must capitalize on new opportunities and revenue streams created by IoT.
Throughout every industry, without exception, there’s endless potential to leverage IoT for growth. Today, we are going to look at four leading companies across four different industries who are fully engaged in monetizing IoT.
Retail: Kroger Restocks Their Profits with Smart Shelves
Kroger, the US based supermarket giant, teamed up with Microsoft to liven up the classic grocery shopping experience with the help of IoT smart shelves. The Kroger company grew into the largest supermarket chain in the United States by, on the one hand, thinking outside the box to maximize revenue, and on the other, consistently solving customer problems. In the early years of Kroger’s growth, that meant creating on-site butchers and bakeries, replacing the prevailing business model where grocery stores purchased baked goods and meat from third party sources.
Fast forward to today and customer expectations are vastly different, and so are the opportunities. Kroger was able to see that IoT technology could help them do what they always did best: create an excellent customer experience and generate profit. With that goal, Kroger Technology partnered with Microsoft to create IoT smart shelves. The smart shelving system shares information about the products on the shelves with shoppers, store employees, and upper-management. Customers can sync the smart shelves with an app that tells them the exact location in the store of each item on their shopping list. The app offers tailored discounts, and even helps identify hard-to-spot items, like gluten-free foods. The smart shelves also help Kroger manage product stock better. Store managers receive information about out of stock products, and can rapidly change prices to provide an incentive to buy when they need to move stock. The data collected by smart selves also monitor the selling power of various store locations, products, deals, and more, furthering the companies cost saving interest.
Agriculture: AT&T Connects to a Completely New Field
AT&T is a multinational communications conglomerate, not exactly known for their innovation in the agriculture space. Actually, AT&T is the perfect example of how IoT monetization often requires successful companies to partner with key players in other industries to create new revenue streams. As an expert in the communication side of IoT, AT&T was able to plant themselves inside the world of agriculture by partnering with WaterBit, a small but successful irrigation company. WaterBit understood what farmers need. They understand user behaviors, perceived value, and market dynamics. AT&T chose to partner with WaterBit to actively expand into the agriculture industry.
Together, WaterBit and AT&T successfully monetized IoT through the creation of a smart irrigation system aimed at American rice farmers. Rice is one of the world’s most water intensive crops, accounting for 40% of water used in irrigation each year. That amounts to a tremendous capital expenditure that farmers have to endure each year. It also drains natural resources, and leads to high carbon emissions. When connectivity is added to irrigation systems, information about soil moisture and crop conditions are delivered directly from the fields to hubs where the data can influence the decision making process, without human intervention. Instead of watering the crops based on a preset schedule, the smart irrigation system works dynamically to adjust water levels based off actual need. The result is that farmers can increase yields, save costs, and reduce waste.
Through its partnership with WaterBit, AT&T was able to instantly gain the trust of a sector it had no previous relationship with. In the future, AT&T will undoubtedly continue to create compelling solutions for the agriculture industry and see high ROI.
Healthcare: Hill-Rom Creates Unprecedented Levels of Patient Care
The medical systems manufacturer Hill-Rom was established just over 100 years ago. In its first incarnation, it was primarily a hospital furniture manufacturer. It produced more comfortable wooden hospital furniture, and used a six-month-free usage trial to solidify its place in the market. As the years progressed, Hill-Rom grew. It expanded its offerings to include innovative medical devices, and when the first wave of digitalization hit the world, it innovated an advanced digital workflow communication and collaboration system that was sold to healthcare providers.
Today, Hill-Rom is using IoT to connect two of its main offerings: hospital beds and digital communication systems. Hill-Rom recently rolled out the new IoT Centrella Smart+ Hospital Beds. These beds are equipped with countless sensors that continuously monitor patient heart and respiratory rates. The Centrella Smart+ beds send an alert to a connected app that tells doctors and nurses in real-time if a patient’s condition requires immediate attention. The beds also feature integrated pressure sensors that can make automatic adjustments to eliminate pressure wounds, a chronic problem for patients and care providers. Finally, the beds communicate the data they collect to a larger workflow system, giving caregivers an unprecedented understanding of their patients’ needs and providing patients with an advanced level of holistic, timely care.
Hill-Rom jumped on the opportunity provided by IoT to combine their offerings with existing technology and capitalized on the power of machine-to-machine connectivity. Thanks to their forward thinking approach, Hill-Rom created new value, new business opportunities, increased revenue, and expanded their holdings.
Transportation: Rapid Flow Aims to Ease Your Commute
Rapid Flow is a new player making a big splash in the transportation industry. Their aim is to tackle one of the biggest problems in urban living — traffic. Traffic is woven into the current fabric of city life. Horns honking, red brake lights, and the occasional taxi driver screaming out the window might seem like an unavoidable frustration— but a city without traffic would improve more than peace of mind. Reducing delays increases productivity and safety, and decreases greenhouse gas emissions caused by idling cars.
So how can the problem of traffic be solved? With IoT technology. Rapid Flow looked at the urban landscape and saw that existing traffic cameras and controllers have huge untapped data collection potential. The first part of IoT was already there, they just had to figure out how to get the machines to talk to each other and map traffic flow patterns to reduce traffic. Rapid Flow created Surtrac technology, an AI/robotics program that enables traffic cameras and sensors to communicate with signals and controllers. It focuses on adapting traffic lights so that traffic can flow with shorter wait times. The software creates an initial traffic plan, and then communicates it to neighboring intersections so that the coordinates can work together to create an even better, dynamic, traffic plan.
For years, the solution to traffic was building new roads, adding more lanes, or trying to get people to use mass transit. Yet what is happening at Rapid Flow is representative of the overarching effect of IoT on business. Rapid Flow is disrupting the accepted thinking, challenging the status quo, and using IoT to create innovative solutions.
The IoT Is Here to Stay. And So are the Companies Leveraging it.
IoT is fast becoming the key identifying element of the technological advancements the world is currently experiencing. For many companies, including these four industry leaders, IoT spells a wellspring of new opportunity. No matter what industry you are a part of, now is the time to see how you too can capitalize on IoT to build new revenue streams, encourage strong business growth, and create new solutions.
To learn more about how traditional hardware companies are leveraging the IoT for new opportunities, download our latest white paper, Show Me the Money: Monetizing the IoT.