Understanding ‘The Where Factor’ Of IoT

'You cannot do the Internet of Things or the Industrial Internet of Things without real-time location awareness,' notes Pitney Bowes Greg Van den Heuvel in a study of the state of IoT.

The Internet of Things has reached a turning point for marketers, and while most the various use cases that are already active have yet to fully reach the mainstream, businesses that take a “wait and see” approach are likely to be left behind their more experimental rivals, a report by Pitney Bowes and Forbes Insights advises.

The report, Harnessing the Internet of Things: How to Derive Big Business Benefits from the Connected World, offers an outline of how businesses are already applying analytics from the data generated by IoT-enabled sensors to “optimize their own operations, and early adopters stand to reap rewards from this data approach, using it to guide development of next-generation consumer devices and even open up entirely new market segments.”

The report zeroes in on the connection between real-time, data-driven marketing methods and the central role of location in those efforts.

For example, take a situation where a connected device-triggered alert to a problem with a piece of equipment  — whether it’s indoor point-of-sale at a retailer or a connected car or a coffee maker in someone’s home or office. By offering help to a consumer or business, these devices allow for a deeper relationship among marketers, brands, and consumers.

The ‘Where’ And ‘What’ Factors

And as standing the location context, where a given physical object is, Pitney Bowes COO Greg Van den Heuvel notes, knowing the location of the device is essential.

“You cannot do the Internet of Things or the Industrial Internet of Things without real-time location awareness,”Van den Heuvel says. “It’s not possible. That’s the missing piece that will catalyze growth.”

The main point: it’s not just where an object is, but what’s around it that matters.

Rick Ryan, a Pitney Bowes researcher in the Strategic Technology and Innovations Group, offers an example of a city turning traffic lights green to ease the path of an emergency vehicle.

“It’s not just looking at the route it’s going to take, it’s also what’s around that route,” he says. “What points of interest are there that may be gathering crowds? How do you deal with pedestrian traffic? How do you deal with the side streets and things like that? Because you can make the route for that fire truck all green and create a condition that actually blocks the route.”

Beyond The Gadget

In looking at the specific business and marketing applications that tie togetehr location data and IoT, Frank Gillett, a Forrester VP & Principal Analyst, notes that focusing on devices, whether its beacons or some other instrument, is beside the point.

“Often what people do with IoT is they get mesmerized by ‘oh, the gadget’s connected to the internet,’”  Gillett says. “They fail to [realize] no value is created by connecting the device to the Internet. The value gets created when the data flows into the so ware world, and then you analyze that data and gain insights from it, and then take action to change your behavior based on that information. In order to get value from the data that comes from IoT, you have to have analytics somewhere.”

3 Levels Of Value

In his view, the location of a device and the data that is gathered and sent by it, can be used to offer context and value about a consumer’s mindset when it comes to the successful use of IoT.

In the report, Gillett presents “three levels of value” that businesses can realize from the intersection of IoT and location:

  • Improve Operations: The first level of that business value is the ability to improve your operations. If you’re talking about running a piece of mail-sorting equipment or a massive industrial printer, it’s simply to instrument and monitor the functioning of that equipment to improve its efficiency and performance. Make it more predictable, make it lower cost, increase its utilization—keep it busier and earning more money.
  • Differentiate Customer Experience: The second level of value, once you get past optimization, you can actually begin to think about how to use the information to differentiate your offering. You can create advantage or differentiation for your product or your experience by taking care of your customers better. Incremental improvement.
  • Innovate: The third level is what I like to think of as transforming the customer experience or the business model. That’s where you might, say, gather information from all your customers and begin to feed back to them and say, “Hey, we can actually tell you not only how you compare with others, but how to think about and rethink what you do or what your value proposition is.”

Rather than looking four years into the future, the report’s authors emphasize that their advice about IoT is actionable right now.

“Practical, revenue-generating implementations of IoT are happening but they are in a nascent stage,” says Joe Francica, Managing Director, Geospatial Industry Solutions at Pitney Bowes. “They are occurring but not in volume. Companies are investing in big data frameworks to handle data from connected devices and they are looking at the ROI. “IoT,” and ‘Big data’ are great buzzwords; now companies are looking carefully at the ramifications of investments in new technology platforms that actually support a revenue model.”

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.