Education

IoT marketplaces should learn from SaaS

It’s interesting to see how key players in the IoT space are marketing their wares. I’ve noticed the following trends:

  • The IoT marketplace, where customers are invited to click-and-buy IoT products exactly as they would buy gadgetry on Amazon. Sensors are comingled with the requisite cloud apps, where fancy dashboards and some basic analytics are provided.
  • The systems approach, which usually entails pitching the features of a system or service and enticing the customer to adopt it on the basis of its capabilities. No click and buy option here, as a ‘system’ could be too complex to itemize and sell on a web site. You need a competent technical salesperson to guide you through to an RFQ.
  • The value-driven approach, whereby the emphasis in placed on the benefits of adopting a given IoT solution. The details are sometimes sketchy, e.g. on some vendor websites it’s hard to tell if they’re advertising a software platform or a full-stack solution.

I certainly admire those pioneers of the IoT Marketplace for their bold and ambitious view on how the game should be played. You certainly need to have available a broad portfolio of Things to do this in earnest. Very few companies in the consumer and enterprise sectors have accomplished this to date.

But I’m also skeptical about the Marketplace model… Is the customer perception of IoT well developed yet, so that click-and-buy will lead you to a desired solution? This may work well in the consumer IoT space, where the customer is usually a tech enthusiast or gadget geek often buying stuff on impulse. But in the enterprise and industrial space, the anticipated ROI of a given purchase needs to be justified. Often this is putting the onus on a customer (and a well-versed CIO) to select, procure, connect and make sense of it all.

This approach places focus — incorrectly in my opinion — on the Things rather than the service they enable. This is putting the cart before the horse. It would be more useful if IoT Marketplaces presented and quoted a service instead, and made the procurement of the requisite hardware as seamless as possible. The investment only makes sense once the data starts flowing and meaningful analytics can be performed. This should be the key selling point.

To this extent, the ideal online IoT marketplace should look and feel more like a SaaS subscription page. The point is making the service element the centerpiece of the IoT solution. The fundamental principle of IoT is that the plumbing is already there (APIs and the cloud). So you can presumably consume an IoT service on tap. My guess is that successful IoT solutions vendors shall be those who can deliver service as easily and effortlessly as Salesforce is enabling cloud CRM.

The hardware needed to enable the IoT service should be readily available of course, and should also be easy to install in a self-service manner. This does usually entail getting the products shipped to a physical address, unboxing the devices and activating. A properly designed IoT product should make these steps easy as pie. One of the usual impediments there is data connectivity. Most products will require access to Wi-Fi or the cellular network, so an additional activation step is needed. The advent of IoT-oriented cellular data services (such as SIGFOX) will perhaps solve that.

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