How the internet of things can help marketers pinpoint their efforts

The connectivity of smart devices helps consumers find businesses, of course, but the inverse is true as well. Location information is just one element of the commercial toolkit.

Internet of Things (IoT) technology is found in billions of internet-connected devices that collect and share data.

From smartwatches to fitness trackers to phones to cars and even refrigerators, IoT has become part of everyday life. The rapid pace of new connected devices populating the IoT ecosystem has Gartner projecting there will be 20 billion “internet-connected things” this year.

The growth of IoT is transforming industries across all sectors, improving productivity and efficiency and enhancing customer service and experience. Marketing is one sector realizing the transformative potential of IoT. The technology is changing many aspects of the marketing discipline, from how organizations interact with consumers to traditional direct mail strategies.

One major implication of IoT for marketing is the way the technology changes how organizations connect to consumers. The vast ecosystem of interconnected IoT devices generates massive amounts of data that marketers can use to drive smarter, more engaging interactions with consumers. Analyst firm IDC estimates that by 2025 there will be 41.6 billion connected IoT devices generating 79.4 zettabytes (ZB) of data. To put this into context, just one zettabyte is equivalent to about 250 billion DVDs; that’s a lot of data.

Marketers are using the data from IoT devices to gain a greater understanding of their audiences. This insight is key to delivering the personalized interactions consumers have grown to expect in the era of Netflix and Amazon. As organizations capture more data on consumer habits, location, preferences, intent and needs, marketers can use this data to deliver contextually relevant messages to the right consumers at the right time.

An example of how marketers are doing this is by using IoT technology to gather consumer location data. Marketers use this location data to determine when a prospective buyer is in the area to trigger the sending of timely personalized alerts with coupons and discounts. Giving consumers what they want when they need it enhances customer experience which, in turn, generates more sales.

Direct mail is another aspect of marketing being transformed by IoT. Direct mail has long been an effective component of a marketer’s toolkit and, even in this digital age, continues to deliver results. A recent response rate report from the Direct Marketing Association found that direct mail achieves a 4.4% response rate, compared with 0.12% for email.

Marketers are using IoT technology to further boost the effectiveness of their direct mail strategies. A recent campaign executed by Land Rover used IoT technology to help get potential buyers behind the wheel of its new Range Rover Evoque. Land Rover sent an interactive direct mailer to potential customers which then communicated with the dealership through an IoT network, enabling customers to request a test vehicle directly to their location with the press of a button. This direct mail campaign led to an unprecedented 48% response rate, or over 2,000 test drive requests, blowing the average 4.4% response rate out of the water.

As shown by this example, IoT technology has the potential to collect a great deal of information that is useful to marketers when implementing and collecting results on strategic campaigns. Often marketing professionals are asked to show how the work provides value, and the hard data IoT can provide makes it easier to showcase results. Through this technology, such key data as location and consumer information can be tracked with a low power solution.

As the adoption of IoT devices grows, marketers can use the data and insights generated from these devices to deliver relevant, contextual messages in real time to enhance customer experience and increase conversions. The proliferation of IoT technology also presents opportunities for marketers to reach consumers in new and innovative ways, transforming tools like direct mail to engage digital consumers.

Kent Rawlings is president of Sigfox Canada.

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