IoT And Connected Markets
The Internet of Things (IoT) involves connected products, assets, fleets, infrastructures, markets, and people. In this series of blogs, we’ll address each of these connected aspects in turn.
We’ve grown accustomed to the idea of IoT in retail environments – for example, beacons that can recognize participants in frequent-shopper programs and automatically deliver personalized offers to their cellphones. But IoT can transform other kinds of markets, as well.
In rural settings, IoT can augment physical infrastructure to enable new connectivity and capabilities for agribusiness and related supply networks. In urban landscapes, IoT can connect traffic, buildings, and public spaces for greater efficiency and more effective services.
In both cases, IoT can empower new insights, innovations, and business models. It can also optimize the use of assets and natural resources; reduce energy usage, emissions, and congestion; and improve efficiency and quality of life.
But it’s still early days for connected markets. To see return on their IoT investments, organizations operating in these contexts will need to identify opportunities for quick wins – while understanding that the most significant payoffs will be achieved over time.
Connecting for transformation
Connected markets can enable transformations in three key contexts:
Market insights: Consumers and citizens increasingly demand consistent and seamless experiences across time, space, and geography. IoT enables retail and other public spaces to respond. Connected markets leverage beacons, mobile connectivity, and identity solutions to understand behaviors and preferences and then deliver hyper-personalized experiences.
For instance, a leading provider of sports apparel and equipment created a customer-activity repository to achieve a 360-degree view of customers. In one initiative, the company is leveraging a customer fitness app to track running, cycling, and other sports activities to serve up personalized offers.
Rural areas: Agriculture is big business, and modern farms and ranches can be large enough that they need to be managed by aircraft and other extensive physical infrastructure. And in both developed and emerging economies, agribusiness increasingly must do more with less to feed growing populations.
Connected markets augment and transform physical infrastructure to deliver new insights and capabilities. You can capture data from agricultural equipment to improve efficiency and operation. You can connect partners up and down the supply network to create transparent and sustainable food supply chains and better manage price volatility. Satellite, GPS, cloud, and related technologies are connecting even the most remote operations, from food producers through to wholesalers, retailers, and consumers.
Urban areas: As the global population grows, it is becoming more urbanized. Today, 50% of people live in cities, and by 2050, 75% will. To manage this growth and deliver services effectively, cities will need to become more connected.
IoT enables cities to respond as the work and personal lives of citizens become more mobile and automated. It can optimize traffic, energy usage, public spaces, ports, and other physical infrastructure.
The trend has already started with simple applications like smart parking. Smart parking combines sensors, cameras, and apps to help citizens quickly find parking spaces, help cities predict parking needs, and measurably ease traffic congestion. It will continue with autonomous living choices. One example is laundry. When designing high-density housing, rather than include laundry space in every apartment, urban developers might centralize laundry, using connected technologies to optimize the experience.
In both rural and urban markets, governments have a vested interest in driving IoT deployments. But governments often lack budgets for new IT initiatives. As a result, public-private partnerships will be key to the development of connected markets.
The potential upsides of connected markets are compelling. Once a market is virtualized, the opportunities for reaching new customers, partners, and even industries grow exponentially. The organizations that figure out connected markets will gain significant first-mover advantages – and position themselves for longer-term industry leadership.
Effective IoT connectedness requires a unifying foundation. SAP has addressed this need by introducing SAP Leonardo, an innovative IoT solution portfolio designed to help organizations digitally transform existing processes and evolve to new digital models. Learn more by downloading an SAP Leonardo brochure, reading about real-world use cases, attending our flagship event Leonardo Live this summer, visiting sap.com/iot, and following us on Twitter at @SAPLeonardo.