ROI for IoT Part 3: How CX Creates ROI Opportunities for IoT Products

Sara Taylor


CX_IoTParts 1 and 2 of this 3-part blog series explored data generation and business models for the Internet of Things (IoT) products that may increase or demonstrate ROI for your organization. In part 3, we’re giving you one more leverage point: customer experience.

cx_quote_IoT3.pngCustomer experience is the digital buzz word of 2016, but paradoxically it sounds fluffy, vague and difficult to sell internally to colleagues. Combine IoT -- a new concept to many enterprise organizations -- and customer experience, and it seems like a tall order to justify investment. At the heart of great IoT customer experiences is trust, leading to increased customer retention and lowered cost of acquisition. Clear points of justification.

As customers (“customers” are consumers, employees, suppliers and vendors) work with you to accomplish their goals, any touchpoint will cause emotions: good, neutral or bad. Emotions are derived from your customers’ deep seeded and preconceived expectations in relation to your brand promise. Expectations are also determined by your target’s beliefs, assumptions, behaviors and prior attempts. Point is, get emotional with your customers. Conduct 6-8 one-on-one interviews (CX Research) per segment in order to understand the why of your customer’s behaviors and beliefs. By understanding your customers, it is possible to provide the best customer experience possible -- and IoT is part of CX solutioning.

Let’s examine three examples of companies providing a great IoT customer experiences:

1. Hilton Hotels: Digital Key


 Like other large hotel chains, Hilton has added the capability to unlock your hotel room door using your smartphone. With Hitlon Digital Key, hotel-stayers are now able to check in, choose their room, and unlock their door all from Hilton's HHonors app. Once the user's room is ready, they will be prompted with a message to their smartphone such as, “We see you landed in Boston and your room is ready!” The customer is then able to directly proceed to their room, without the bother of checking in at the front desk. Run by Bluetooth technology, users simply unlock their door by opening up the app and waving their smartphone in front of the lock. By putting this experience back into the customer's hands, this allows the staff to concentrate on what a hotel is supposed to provide...comfort, relaxation, and a great guest experience.


AmazonDash.png2. Amazon: Dash Replenishment Services

Amazon has evolved greatly as an organization, from simple one-time customer orders to subscriptions and now adding the Amazon Dash button--a physical ordering button for CPG goods. Dash, for example, sticks to the side of your washing machine for a quick re-order of detergent with the push of a button. However recently, Amazon took their CX even father, by adding the Dash Replenishment Service which enables your connected home products to seamlessly order for themselves. 


3. Fujitsu: Smart Cane


This next-generation cane prototype from Fujitsu uses GPS, Bluetooth, and WiFi to help guide walkers needing assistance to reach their destination. This cane's handle is not only equipped with a LED display screen that uses lights and vibrations to direct the walker, but is also embedded with a sensor that makes it possible to track the walkers temperature, heart rate and location. For example, if the cane senses the user has fallen down or they have an ireregular heartbeat, it sends data to a host computer, streams the information to a relative or caretaker, and automatically contacts emergency services. Fujitsu is looking at ways to help us remain mobile and stay connected later into our lives. 



If you notice, these IoT examples address customer expectations, and that’s on purpose. By directly addressing customers’ pain points with empathy, your digital teams can create IoT solutions that benefit you and your customers. My colleague, Lewis Lancaster, brought up ways to do this in part 1 and part 2 of this blog series. Use data to gain product life-cycle visibility, consumer insights and add partner integrations. Think about ways IoT can reinvent existing products and service lines to better serve these customers.

As IoT solutions are developed through CX Research methodologies, your customers will feel a difference from your company. The ultimate goal is that customers will feel like you know them. Over time, we can expect that loyalty, retention and advocacy will increase (see our diagram to the right).

It’s obvious that increased retention and lowered cost of acquisition can have a positive effect on the bottom line of any business. Forrester has documented this phenomenon in its CX Index scores. Here, CX leaders outperform CX laggards against the S&P 500 by 76.9% margin, as measured by Forrester’s CX Index algorithm.


As we think about how to tackle IoT and its associated ROI, three themes have emerged: Data, Business Models and Customer Experience. While data and business models seem straightforward, implementation of CX may seem complex or ambiguous.

How to make CX and IoT real:

  • Conduct one-on-one interviews (CX Research) with real customers to understand their needs and expectations (empathize); create CX customer journey maps
  • Select key customer pain points and customers needs in the CX customer journey
  • Determine business objectives and desired data outcomes
  • Brainstorm how existing or new product offerings can be transformed with IoT technologies to address customers’ needs
  • Decide on how an exchange of data will benefit both the customer and company
If you are looking for an IoT partner, look no further. Check out Solstice's IoT capabilities.