3 Things Marketers Should Consider About IoT

Hal Conick
Marketing News
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Key Takeaways

​What? There will be 50 billion connected devices by 2020, a major insight opportunity for marketers.

So what? Researchers suggest there are ways marketers can serve customers with IoT rather than purely gathering data.

Now what? One marketing professor says marketers must add value for customers as a part of any IoT business model. 

​March 16, 2017

Here are a few IoT considerations for marketers from the AMA’s recent 2017 Winter Conference 


The Internet of things (IoT), or the connection of computing devices embedded in everyday objects, is moving up the budget sheets of companies across the world. It's also on the lips of many marketers. By 2020, CCS Insight predicts 50 billion connected devices worldwide, with International Data Corporation (IDC) predicting $1.29 trillion in IoT spending by the same year. ​

But what should marketers make of it? 

Marketing scholars at the AMA’s 2017 Winter Conference discussed the burgeoning technology. Here are three IoT considerations for marketers to keep in mind:

1. Adding Value

“Why do customers need this?” 

That’s the question marketers need to be asking with any IoT-related device, according to Venkatesh Shankar, professor of marketing at Texas A&M University. He says value must be added for customers. 

Shankar noted Sonos speaker sets, which connect, “talk” to each other and partner with services like Spotify and Amazon Music.

“If you think about it conceptually, there’s a value creation and a value capture in this model,” Shankar says. Working with partners, even if it means stumbling or making mistakes, is a great way to find a valuable business model, he says.

Framing that value is important. Shankar paraphrased iControl’s CMO, who said people won’t spend money on the company’s product if it is called “home automation,” but that they do spend $35 to $45 a month on it when it’s called “home security.”  

This model is very different from the internet, which Shankar says is reactive while IoT business models are predictive and evolving. The sun may be setting on the tradition of selling the next product or device, but the sun seems to be rising on IoT, which could enable recurring revenue. 

2. Avoiding the Uncanny Valley

Ever wonder why Siri, Alexa and other robot-helper voices don’t sound more human? Charles Hofacker, professor of marketing at Florida State University, says this is purposeful, as brands are trying to avoid entering the uncanny valley. 

The uncanny valley, according to TechTarget, is the unsettling feeling people experience when androids or audio-visual simulations “closely resemble humans in many respects but are not quite convincingly realistic.”


 The Unnerving Uncanny


Hofacker says brands will need to figure out what to do when IoT and artificial intelligence-based machines have autonomy and are able to take actions, such as walking up to humans or starting a conversation with them without startling them.

3. Improving Health Care with IoT

IoT and wearable technology may soon be playing a bigger role in health care, but Hope Jensen Schau, associate dean and professor of marketing at The University of Arizona, says the role of wearable, IoT-connected technology is already being seen in preterm infants. 

Schau says there are now wearable incubators and monitors for babies, as well as wearable devices to prevent sudden infant death syndrome by measuring heartbeat, body temperature, movement and noise. Information from these devices can be viewed by a doctor in real time. There’s also a wearable blanket for jaundiced babies that administers light therapy while allowing parents to hold the child. 

Schau, a mother who had her child in an incubator, says these IoT-connected devices have a lot of pros: data streams straight to doctors, normalcy instead of visits to an in-hospital incubator, decrease of hospital stay by 2.5 weeks and more productive conversations with doctors. 

However, there are also cons: “Sometimes people forget that this baby is more than the sum of this data,” Schau says, adding that parents may start watching the wearables instead of minding the child. If parents are scared that the child is compromised, the willingness to yield to science can be overwhelming, meaning the numbers will get more care than the child. “You also lose some efficacy.”

Schau says with balance, these IoT devices can be extremely beneficial for health care, giving options for empathetic care, efficiency and more effective care of the child.

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Author Bio:

Hal Conick
Hal Conick is a staff writer for the AMA’s magazines and e-newsletters. He can be reached at hconick@ama.org or on Twitter at @HalConick.
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