Harnessing Data to Create New Revenue Streams with IoT
With over 28 billion Internet connected devices currently in use, and a projected 50.1 billion connected devices in use by 2020, there is more data being collected than ever before.
Market leaders are capitalizing on this inflow of data and leveraging IIoT (Industrial Internet of Things) to not only enhance the customer experience, but also create new revenue streams for their business. According to a recent report, 96% of respondents said their companies would be using IoT in some way within the next 3 years. 68% said their companies are already investing in IoT. Despite heavy investments into IoT solutions, many organizations have failed to capitalize on these opportunities to their fullest potential. In fact, "over 70% of organizations do not generate service revenues from their IoT solutions." Sensors are cheap; it’s the software enabled full stack solutions that set the market leaders apart from the laggards.
Every industry is being transformed by IoT and the incredible amount of data available. From manufacturing to agriculture, companies are looking into how to most effectively utilize this data.
Kaeser Kompressoren, a manufacturer of air compressors, turned a connected product into a new service line by implementing an entirely new business model. By putting sensors on the products they built and utilizing the data that was being generated, they were able to create a model for predictive maintenance. With this new capability in hand, they launched an “Air-as-a-Service” option, in which Kaeser owned and maintained the equipment that it’s customers used and the customers paid for the compressed air produced by the cubic meter. Rather than producing revenue, service calls are now a cost for Kaeser. They use their data to reduce the number of service calls, and instead generate revenue via the uptime of their compressors.
One leader in the agriculture industry has evolved their business beyond being a farming equipment provider. Embracing the immense data already generated by much of their existing hardware, many of their tractors and other equipment have added Internet connected capabilities, providing a level of insight never before accessible to the user. For example, the thousands of data points that each sensor on a planter collects can be analyzed and provide value to the grower to improve efficiency as well as yield. Customers are willing to pay for that data as well as continue to stay engaged with the brand for future services.
Building out new hardware capabilities is just the start. Capturing valuable data and optimizing the customer experience to make it simple to access and utilize that data is where the real opportunity lies. Now is the time to focus on how a full stack IIoT strategy can transform your business and open up new possibilities and revenue streams.