Why Marketers Aren’t Ready for the IoT
The consumer Internet of Things will change the way companies work. Are they ready? “Probably not,” says Boston College’s Sam Ransbotham. “There’s a lot of excitement about the potential insights from IoT, but there are a lot more changes coming with the IoT transformation than many marketers may recognize.”
Ransbotham is among the data analytics experts speaking at MSI’s September 30 conference, “Marketing in the Consumer Internet of Things.” The conference is aimed at marketers who want to get ahead of what many see as a coming revolution in the way firms and consumers interact.
Ransbotham, who received an NSF Career Award for his research in information security and is the guest editor for the MIT Sloan Management Review Data and Analytics initiative, is an authority on the changes that lie around the corner for businesses and markets. In a 2015 Sloan Management Review article, he outlines four:
Market power. “The IoT should provide a greater amount and a greater value of data, but are companies ready to align their interests in obtaining value from this data with the multiple other companies and end users who create, own, and service the products that originate the data?” he writes. “A boon in data value might cause rifts among those with a stake in its benefits.”
Complexity. As products are built with embedded sensors, the component mix increases in complexity, and manufacturing systems and supply chains will become more elaborate. Further, software embedded in products will need to be updateable. “Few organizations are prepared to be hardware and software development companies. But that’s what the Internet of Things will enable.”
Security. From unauthorized control of wind turbines to dolls that allow attackers to overhear conversations, security problems can spread as quickly as IoT devices, Ransbotham notes. More ominously, “the attacks might be ones that we don’t notice, as poisoned data streams may be difficult to discern with the volume of data that IoT devices produce.”
Process changes. “With the IoT transition, data will stream in constantly, defying routine reporting and normal working hours.” Can organizations develop the capacity needed to take advantage of it? Few large companies are ready for this, much less small- to medium-sized ones.
The good news is that companies can get ready for the changes as well as the potential benefits of the IoT. Ransbotham points to four steps firms should take before considering, designing, deploying, or installing IoT devices:
• Clarify ownership and governance;
• Decide whether to invest so that development becomes a differentiating competency or work with specialty organizations;
• Design in security and update processes;
• Design processes to build on the new information.
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Marketing on the Internet of Things
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