Selling the Value of the IoT
There’s a growing consensus that the Internet of Things (IoT) will trim costs and fuel enormous efficiency gains. IoT projects also introduce new and sometimes dramatically improved ways to conduct business. “[They] can completely transform and disrupt conventional approaches to workflows, processes, and business models,” explains Benson Chan, senior partner at Strategy of Things, a Hayward, Calif., IoT consulting firm.
Yet selling the value of the IoT to potential customers and clients who don’t understand the value of IoT solutions can serve as a stumbling point for turning leads into sales.
A Dollars and Sense Approach
The evidence shows that the Internet of Things can generate a tangible and definable return on investment. A 2017 study conducted by Santa Clara, Calif.-based Aruba Networks, a Hewlett Packard Enterprise company, found that the IoT produces clearly defined returns across multiple vertical industries.
The survey of 3,100 IT and business decision makers from organizations in 20 countries with 500 or more employees found that 72 percent of organizations have introduced some form of the IoT into the workplace. Seventy-eight percent of those firms, moreover, have experienced improved IT effectiveness as a result, while 72 percent have enjoyed increased profitability.
On average, companies deploying IoT technologies realized a 34 percent ROI. Customers comparing pre-adoption and post-adoption processes found that reality exceeded expectations. Before an IoT project, only 16 percent of business leaders expected profit gains, but 32 percent reported significant boosts following IoT adoption. Similarly, while 29 percent expected their IoT initiatives to improve business efficiencies, 46 percent actually collected that benefit.
The Aruba Networks report detailed improvements across a wide range of areas spanning from business and IT innovation, new market expansion, and new product features to higher IT infrastructure efficiency. Also included were new business models and significantly better customer experiences informed by analytics-driven services research.
Overall, 82 percent of survey respondents reported business efficiency gains and 77 percent improved visibility into internal workflows and processes.
Connecting to Value
Data like that is a good starting point for clarifying the value of IoT investments for would-be clients. According to Chan, one of the problems with the IoT is that it involves a broad and sometimes confusing array of technologies, platforms, processes, and standards. “It’s important to understand how various systems and technologies can lead to results,” he says.
Chan and others suggest doing some basic analysis when pursuing sales prospects and making the resulting data a key part of your pitch. Focus on vital areas such as increased efficiency, cost savings, higher customer satisfaction levels, innovation, better security, greater profitability, and improved visibility into operational processes when promoting and selling the IoT to prospective customers.
According to the Aruba report, 97 percent of organizations expect the IoT to deliver returns in the next five years. But expectations don't always become reality. It's easy to underestimate the complexity of IoT projects. Integrators and VARs that wish to tap into that enthusiasm must develop plans that “capture the attention of company leaders outside of the IT department” and provide a roadmap and technical plan for arriving at success.
Samuel Greengard is a business and technology writer based in West Linn, Ore. He is the author of The Internet of Things (MIT Press, 2015).