What is the IoT all about? Lets start completely from the beginning with a simple example:
Think about a light bulb in your driveway that is connected to your car, so when you get home your lightbulb knows that your car is coming home and turns on automatically. This happens because both of them can exchange data to trigger some actions.
Connectivity is the main component here, obviously. It means that objects are interconnected with each other and can work together.
The thing is, it isn’t. An IoT product has two parts:
The hardware product (the thing) with connectivity
The platform the thing is using to deliver services
Great services make great IoT products
Most development teams make the mistake to focus on the connectivity of the object. For instance with an mobile app. They totally overlook that the IoT is not only about connectivity of physical objects – it’s about services.
The Mr. Coffee machine for instance is one of those products that only focuses on the connectivity.
They did the following things:
- Create a physical product, the coffee machine.
- Enable connectivity
- Make an App to remotely brew a coffee and some other things
- Boom, product done
What is missing, are services that create additional revenue.
Services are the driving forces of the IoT. It is the area where you have to focus on for your IoT product. Services create value for customers, drive product desirability and therefore will create additional revenue for your company.
In the case of the coffee machine: Where is the subscription service that enables the machine to automatically order you new coffee after x amount of brewed coffees? Where is the cleaning subscription that lets the machine order you a new water filtration disk? Just in time before the one in the machine needs to be replaced.
Can you already see where I am going with this? Yes, it is the business model. In the world of the IoT it is no longer enough to just build a thing and sell it. You need a strong business model that enables you to sell additional services to the customer. I recommend you to check out this Post. There, I write about the importance of the business model for your IoT product.
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Until next time!