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The Optimal Retail Experience for Consumer IoT Products   

Sachin Mahajan, (TELUS & MobileLive)

             Until and unless you have been hiding under a rock, odds are that you have heard about the fascinating world of IoT and the transformational impact it is going to have on our lives. As more and more consumer companies realize the benefit too, and start offering their connected products & services, they will more often than not have to tackle the question of the optimized retail & channel strategy for an IoT product. Ten years from now, it might not be a relevant question as the underlying premise would be that all devices would be “smart” or “connected”. Quite like a few years back it was common to refer to a mobile device with applications and advanced data features as a “smartphone” -which now has been replaced by just a “phone” as we expect them to be inherently smart.  Similarly all consumer electronic devices, homes & cars would be smart & connected- but until utopia is reached, let’s analyse what companies are currently doing to sell these devices through the retail channel…. and what’s working and what’s not.

Every product has unique marketing and channel needs based on its evolutionary phase on the technological lifecycle.  Looking at where consumer IoT stands today, what really is needed is an effective way to humanize the story or bring it to life through tangible real retail experiences.  Consumers need to see them, touch them and have a compelling desire to own one these fascinating (sometimes overpriced) devices. We need to collectively find a way to help make the leap from B2G (Business to Geek) to a real B2C story and not just having an endless aisle of products with no one to discuss them with!  To better understand how these connected products were being promoted I went mystery shopping on one of my trips to SFO. There was a lot of chatter around Best Buy, Sears & Targets’ concentrated efforts in this space and hence I visited them to make a mental note of the best in class approach.

Best BuyBest Buy has singled out IoT and the Apple watch as the 2 drivers for its success this year. By their own admission, the combination of these two helped fuel consumer demand and resulted in the firm posting expectation-busting numbers last month, which increased the share price by 14%. Full marks to them for giving the “connected category” prime real estate and investing in customer experience. The store I visited, much to my delight, had the “connected section” right at the front of the store but what made the experience so much more meaningful was the fact that they had miniature rooms created which helped visualize the product experience and the art of the possible. The store rep was informative (but not insightful) and looked a little bit out of his depth, although he did a good job with up to date infn on most of the products.

To be honest, the connected ecosystem is quite confusing. The market is overcrowded, products are sold piece meal and there are a plethora of choices on technology- with no clear winner. A lot of people find out the hard way, including yours truly, that they have invested $400-500 in a proprietary technology or a hub which has limited to no interoperability with other expensive goodies.  Where companies could help a lot more is through specialist reps who understand the ecosystem extremely well and can recommend products meeting the customer’s unique needs. That’s where Sears has hit the ball out of the park!

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                I had the opportunity to visit their much hyped San Bruno flagship store, which essentially has 4,000 Sq Ft dedicated section to the connected consumer experience.  As the pictures and this virtual video illustrates they have actually got real estate dedicated to each room of the house with live use cases and products being highlighted. In a way Sears is forcing customers to explore, learn and interact with connected products and see them working in the context of the home. To top it up the customer rep I interacted with clearly understood the complexities of the products showcased – he was extremely helpful and actually suggested alternatives to setup my home automation system with the best in breed (compatible) products at the least cost! Truly a memorable experience!  Hoping to see more wide scale rollout of similar “experience centers” from other retailers.

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Unfortunately, I wasn’t able to visit Target’s experimental store called “Open House” where not only are they experimenting with some of the most advanced Consumer IoT devices but also new ways of retailing in general. From what I read, they seem to be focussed on helping customers discover new products, getting them to understand what their own unique needs are and also in capturing feedback to optimize the experience! The target store I visited really dint have much to write home about as some of the reps didn’t  know if they had a “connected section”, to begin with. Waiting on David Newman to have a wider rollout of the connected store experience.

In a nutshell, the increasing complexity and interoperability challenges for IoT products are making the Sears/Apples’/Best Buy’s operating model increasingly relevant as customers want and need more help selecting, installing, connecting, integrating, using, maintaining and taking full advantage of their products. These companies have already invested heavily in the real estate and now need to make Customer’s physical experience and education around IoT front & centre of their strategy to ensure they can get back into the game and compete long term with the Amazon’s of the world.

Based on what I just witnessed it seems to be game on!

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The Awesome Twosome: IoT & Big Data

Sachin Mahajan MobileLive & ex-TELUS

Its 2001, Apple is readying up to launch an iconic product & experience revolutionizing the portable music player industry. The product is named unconventionally, as the iPod. Steve Jobs has been intrinsically involved in the design, user experience and even the minutest detail such as the color of the iPod…..to this end they were conducting focus groups to better understand which iPod color might be the primary choice of shoppers, and hence to launch in. Over a period of 2 days and intense discussions later the focus groups came back with the unanimous decision on the color – “Yellow”. The product management team thanked the focus group members for having spent their time and as a gesture of their gratitude asked the participants to pick an iPod, of their choice, on the way out  80% of them chose white!

Data often tells a story which is contrary to what people say….some of the big data analytical tools give us the latitude of looking for patterns rather than making us all anthropologists trying to observe people’s behaviour and try to differentiate between what they say vs what they actually do.  How many of you would have believed that with the launch of the white iPhone, the sales of white cars would have gone up in LA; I wouldn’t have. But apparently- women like to match their colors; again big data would have allowed us to make such predictions.

I stumbled upon the following graph from Gartner, indicating that IoT had recently nudged Big Data from the “Peak of Expectations” into the “trough of disillusionment”. Not sure I completely agree with the chart since one in six (15 %) consumers already use wearable tech today, such as smart watches and fitness bands, making me believe IoT doesn’t fit the mould of Gartner’s previous predictions- where largely  <5% adoption existed well into the “Slope of Enlightenment”. Either way IoT & Big Data have arrived and if we marry the two together- we definitely have a winning proposition.

The value of IoT is definitely in increasing revenue, productivity, efficiency & lowering cost, but often companies forget the value of the data it generates. I see the culmination of big data and IoT fundamentally altering the value proposition to the end customers by providing insightful, relevant and actionable data to influence the decision making paradigm in real time, improve QoE and lastly unlock the hidden value of the same data in parallel verticals.

Let me elaborate, essentially IoT and Big Data are working together in 3 ways:

  1. Finding Big Data trends created by IoT Applications.

 As millions and billions of things get connected to the web, there is going to be a tsunami of information generated over the next few years. From the dawn of time until 2004 – 5 exabytes of information was generated and captured. If you ask how much is that data- it essentially is books stacked from earth all the way to pluto and back 80 times over. In the course of the next decade 500x of data it was created and from 2015-17 it is forecasted to grow by 1500x. The biggest hurdle facing organizations considering IoT deployments will be knowing what to do with the massive amounts of information that is being gathered. One challenge which needs to be overcome is to design for analytics – executing a strategy that sees data more as a supply chain than a warehouse. Another is the ability to marry big data trends with in depth expertise in the vertical being explored.  Analysts believe that organizations which can effectively overcome these two issues will financially outperform their competitors by 20-30%. That is incentive enough for most businesses and hence we see companies such as Mnubo & TIBCO’s  and other IoT Analytics Platform companies’ IP becoming increasingly sort after.

2. IoT Applications and Big Data Complementing each other

An auto sharing company recently started allowing their members to drop the car off in any part of the town and through IoT solutions were able to locate it and in real time let potential customers know where to pick it up and open it using electronic keys. Using big data and predictive analysis they were able to optimize the fleet size and through IoT solutions were able to provide unique services and business models which completely flipped the traditional car rental market on its head. This is just the beginning.

The key to really unlocking these new business models and customer experiences is by managing and using IoT & big data in new ways. Another vertical where we see them come together is the retail sector. A 100 years back when someone walked into a store more often than not the shop keeper knew the customer, their choices, socio-economic status and based on it made recommendations. Fast forward to 2015 and it would be hard to find a service agent in a big box retailer to save your life; let alone talk to you abt a product. Here Big data and Iot is being used to recreate the experience from a 100 years back. Providing customers relevant, targeted and focussed recommendations based on their buying pattern of the last few trips and  using IoT as the last mile. Its essentially the golden “2 second rule” i.e providing the customer the required information to help influence their decision making paradigm in the 2 seconds when they are making it. Beacons help track customers in the aisle and while they stand pondering on the type of noodles they need to buy- in real time based on inventory and promotions a recommendation could be pushed to the end customer’s phone. This is not a pipe dream of the future, some companies are making it a tangible reality in the UK today and have reportedly increased revenue by 30+%! Did someone say, it really was the art of the possible?

3.Running different algorithms on the same data set to create use cases for secondary IoT verticals

In a world where we possibly have north of 4BN sensors (and only 3.5BN toothbrushes), we are being spoilt by the richness of the data available across industries. Often, we find ourselves uncovering insights being driven by the data captured for an entirely different business need to begin with. A key example is the connected car. The connected car experience brings safety, security, diagnostic and infotainment applications to the end customer. Applications such as real time traffic information, streaming music, ability to watch a Netflix movie and so and so forth make the consumer’s commute a lot less taxing and more productive. As the next wave of growth comes through the connected car in the IoT space, companies are also finding different applications for the same data:

  • Insurance companies are tapping into real time parameters such as average speed of vehicle, number of traffic violations, harsh braking, accidents and so and so forth. This information is then being used to price the insurance premium of the clientele.
  • Cities are finding valuable insights by looking at congestion of traffic and health of the roads from the connected car. These data points are being used to reduce travel time through improved traffic congestion planning and more insights for emergency response teams
  • Dealerships now have a better handle on the health of the car and are able to communicate more effectively on why the car needs to be serviced with the ability to provide certainty on cost, time and effort needed to rectify the issue.

Clearly, Big data and IoT are harnessing data and converting regular day to day interactions into transformative consumer experiences and that’s where the value for businesses lie.

Google, Apple, Sasmsung…who among today’s front-runners is most likely to dominate the IoT ecosystem?

Sachin Mahajan TELUS

For nearly a decade industry analysts and technology enthusiasts have been discussing IoT and the art of the possible.  Early on it seemed like a pipe dream or a luxury only the rich could afford- with the physical world around you reacting to your unique needs and preferences to provide a contextual, relevant and a very targeted experience. That all began to change over the past 3-4 years as hardware became more affordable,  wireless connectivity ubiquitous, and applications available across various industries. It also finally started becoming main stream as the big boys i.e. google, apple, intel, Samsung, IBM etc. have all started making significant bets in this space. In the past 6-12 months multi-million and in some cases multi-billion dollar acquisitions or partnerships have been announced. Google has just under $60BN and Apple a formidable $160BN of cash sitting in the bank. That’s a sizeable war chest to be used for acquisition and growth in industry verticals they truly believe in!

googlenest                               Dropcam

Anyone following the market would be quick to realize how bullish google is in this space. Over the last few months alone they have invested ~$4BN in acquisitions in the IoT ecosystem- Boston Dynamics, Nest, DeepMind, Dropcam on top of seven small to mid-sized robotic companies!!!! Not to forget their investment in Google’s futuristic X lab – which has a plethora of IoT Platforms(Glass, Driverless car) and the omnipresent android OS which is going to be powering half, if not more, of the IoT devices in the long run!!!! It’s one home run after another. The barriers to entry they are creating are mind numbing – from the consumer hardware space to focussed application platforms (Glass in the B2B space as an example), to Manufacturing plants, Killer IoT Solutions and finally the OS space. I would probably give my right arm (and possibly even other parts of my anatomy) just to be in the room with Larry Page & Co. as they discuss their IoT acquisition/expansion strategy.

download                                                     homekit-logo1

Apple on the other hand has a world domination strategy, more in line with their past escapades. Rather than dish out billions to grow inorganically- they have recently announced Homekit, Healthkit, Carplay and iBeacon plays.  HomeKit is a new framework for communicating with and controlling connected devices in a user’s home. At the outset it doesn’t seem like a novel idea in home automation, as present manufacturers (Belkin, Insteon, Lutron, etc.) have all been vying to be the “central home automation platform”. However, the critical mass of Apple products currently in use (800-900MN) and the smart developer community awaiting a standardized API kit and certified device program will provide the company a MASSIVE advantage!

Healthkit on the other hand is a framework used to store, retrieve, manipulate and present health info on apps. It helps giving the user a dashboard view of their health status by aggregating data across multiple devices and platforms. With over $9,000/person/year being spent on healthcare in the US –it is a perfect vertical to cause disruption or provide help in making sense of all the chaotic programs in place. From a consumer’s perspective Healthkit is exactly what the doctor ordered, so to speak.

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Then you have the other lesser known enablers such as PTC- who first acquired ThingWorx ($120MN) and then subsequently Axeda ($170MN) for the Application Management Platform. Everyone wants a piece of the pie!!!

Clearly, most companies are realizing that IoT is poised to become a key driver of their financial and technological growth for the next few decades and are trying to position themselves best to unlock its hidden value. The race has just begun and the verdict is still out but clearly we have a few front-runners most likely to dominate the marketplace. I as a end-consumer couldn’t be happier; as I truly believe that the use cases for IoT are only limited by our imagination…and we are just beginning to realize the “art of the possible“!

Connected healthcare and the art of the possible…

Sachin Mahajan, MobileLive & ex-TELUS

In the near future, it wouldn’t be unfathomable to find a paramedic at your doorstep with a fibrillator and preventive medication in anticipation of your heart-attack in 30 mins. With the proliferation of fitness and wellness devices your wearable wristband not only has the capability to track your daily physical activity (footsteps, calories burnt, active minutes, sleep patterns, weight, food intake) but it soon will help keep a tab on vital statistics such as blood pressure, body temperature, heart rate etc. Marrying this rich information with your medical records gives us the magic formula to save lives!

Welcome to Connected Healthcare.

The Internet was originally about connecting people and their digital assets. The Internet of Things (IoT) takes it a step forward by directly connecting these devices to one another. When mission critical data or in this case life-saving information is now shared in real time and preventive actions are triggered; amazing things can be accomplished. From connecting firemen suits with sensors and location trackers ensuring their physical safety & wellness to having smart prescription medical bottles (vitality glowcaps) increasing the efficacy of medication significantly and proportionately their effectiveness- the list of use cases are endless.1 bpfbsmartscale

Being an active proponent of M2M/IoT and a technology enthusiast I wanted to put it to good use and achieve my ever eluding goal of getting fitter! A quick stop at fitbit.com ensured that a smart wristband along with a shiny new wi-fi enabled weighing scale were on their way- adding to it a smoothie breakfast, 2 runs a week and squash once a week I thought I was all set to get fitter. It worked- but not for the obvious reasons.

Tracking weight, bmi, number of steps I took in a day was all great but what really worked for me was the community effect/peer pressure it created. I now had a list of friends on my fitbit application (running on my HTC One device) and we all secretly competed with each other to lead the pack. I now knew when my peer walked 31Kms over the weekend as he sodded his lawn or a friend went to a wedding and danced her heart out! It was game time and I wasn’t going to throw the towel in. Six weeks in, am down 7 lbs and the hunger to be the most physically active on my friend’s list is still burning within. I can’t seem to get enough of it! The growing excitement around Apple’s much anticipated “Smart watch” might very well shorten the lifetime of my smart wristband, but really the possibilities for M2M/IoT in healthcare are limitless.

Health Insurance companies, federal & provincial governments are spending billions of dollars for Medical facilities management, extending clinical access, assisted living and caregiver programs- it’s turning out to be a no brainer to also spend on IoT sensors and Connected platforms to increase efficiency, improve productivity, lower costs and make healthcare more accessible to patients in need. We are just beginning to scratch the surface on the “art of the possible” with M2M and one day we hope that these tiny sensors will be disrupting most legacy industries and at the same time improving efficiency and productivity.

Connected Home: Art of the Possible

Home

Sachin Mahajan, TELUS

I have a connected light bulb in my living room. Whenever India plays a cricket match, it turns blue, telling me to switch on the TV and kick back. If I wanted to, I could have the bulb flick on and off a couple of times every time somebody tags me in a photo on Facebook, or BuzzFeed uploads a new article on technology that interests me. I’m also thinking about buying a IoT enabled or connected lock for my front door. It would send me a text message when somebody knocks on the door, so I’d know about it even if I was on the other side of the world. Thanks to a small video camera at the door, I could use my smartphone to see who it is, and to unlock the door if I wanted to let the visitor in. I can do all of this thanks to Machine-to-Machine (M2M) technology and an industry  of really cool apps that’s growing by the day.

Home security

IoT enabled home security solutions have been around for a while. You can have a system installed professionally, or you can do it yourself. Cameras can be activated by motion, sending images to your smartphone or tablet so you know what’s happening inside your home. You can be alerted if something unexpected takes place, and you can check visitors at the door. It’s up to you how much you are able to control. You can even extend it to personal security inside the home, say for seniors. There’s an app that will alert you on your smartphone if your 80 year old parent has fallen, or if there’s been no activity in their home for the last 18 hours.

Automation

This is where the really cool innovation is happening. Take the connected lock I described above and imagine how realtors could use it. Today, many realtors still hang a dropbox with a key in it on the front door of a house they’re selling. Often, they use the same combination for all their dropboxes. That could be a security nightmare. But with connected locks, realtors could simply use their smartphones to check every prospective purchaser at the door and decide whether or not to open up to them.

Energy management

There’s already a plethora of devices that can do amazing things. For example, there’s the Google Nest. It’s only about $250 and you can easily install it yourself. It learns your patterns and preferences and automates them, controlling the furnace or air conditioning just the way you like it, and saving you as much as 20% on your energy bill. I paid over $700 for electricity last year, I could have saved $140! The great thing about the Nest is that it also understands hand gestures. So if you’re cooking something that you know is going to be smoky, you can wave your hand and Nest will switch off your smoke detector for the next 20 minutes.

What’s next for the connected home?

You wake up in the morning and put on your slim biometric bracelet. It identifies you by your heartbeat, which is as unique as your fingerprints so nobody else can pretend to be you. Your thermostat registers that you’re awake and quickly adjusts the temperature to your preference. You go through your morning routines and prepare to leave for work. The front door unlocks as you approach it and locks itself behind you. You walk up to your car and unlock it with a wave of your hand. Along the way, you stop for a coffee, wave your bracelet over the cash register and the cost of your latte is debited directly from your bank account. At the office, your desk lamp switches on when you enter and your computer boots up and logs you in. You finish early because you’re leaving on a business trip, wave your arm again and everything switches off.  Later, at your hotel, you wave your arm at the TV set and it starts up, ready to resume the Netflix show you were watching the night before, at the exact spot you stopped it. Actually, this isn’t a prediction of something that may happen sometime in the future. The technology for everything I’ve described here is available right now . And it’s all thanks to the magic of M2M. I think you can see from all this that M2M really is the “art of the possible“. That’s why TELUS is putting so much emphasis on it, working with partners who are turning science fiction into reality, today.

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M2M on Wheels

Sachin Mahajan (ex-TELUS, MobileLive)

I came to Canada in 2004 and bought a car a year later. Even though I had been driving accident-free for 9 years in two other countries, insurance companies here treated me as if I was a complete novice on the roads. My monthly insurance premium was $700, higher than my monthly car payment. It took me 10 years of fault-free driving – not a single speeding ticket and no accidents – to get my premium down to about $160 a month.

UBI

How M2M & UBI are lowering insurance premiums:

If Sachin Mahajan arrived in Canada today, he’d have another option, thanks to a Internet-of-things (aka as Machine to Machine) technology called User Based Insurance (UBI). Very simply, the insurance company would give me a small device to plug into the diagnostic port of my car. This device would monitor how and when I drive and upload the data to the insurance company.

Then, instead of basing my premium on their generic profile of a young man living in a large city, they could have based it on real information. The UBI device would have told them that I don’t exceed the speed limit and hardly ever drive during rush hour. Those two factors could have reduced my premium significantly. The company might also have been able to tell me, for example, that if I started braking sooner than I usually do, I could lower my premiums even further. And if I started doing more rush hour driving, they could have suggested that I avoid certain times on the road.

Some Canadian insurance companies have been offering UBI for a while now, promising potential savings as high as 25%. It’s just one example of how IoT is giving organizations access to information they simply didn’t have before, and how this information is allowing them to change the way they do business.

UBI wireless connectivity:

Like other M2M solutions, UBI depends on wireless connectivity to work. But even though 4G wireless is available to almost the entire population – TELUS Communications has Canada’s largest 4G network, reaching 98% of the population1 – some insurers have been offering UBI on older technology. There’s one that’s even using 2G.

The 3 phases of the connected car:

However, it’s important to ensure that solutions are future-proof and operate on a network you’ll be able to rely on for many years to come. That’s because the connected car has arrived and with it, M2M solutions that are literally changing the way people and cars interact. Phase 1 of the connected car started with basic integration between your car and your wireless device, allowing you to play music or talk to people using your car stereo, via Bluetooth. Phase 2 includes GPS directions, locking or unlocking your car, getting remote diagnostics etc . Phase 3 will be even more exciting.

Soon, your car will do more than tell you when it needs servicing. It’ll be able to make the appointment for you, and remind you to take it in. Your car will also become its own wireless hotspot, allowing you to work anywhere on your Wi-Fi enabled tablet or laptop, or stream music directly to your audio system without going through your smartphone. Most of these new technologies will require 4G or 4G LTE connectivity, so why would you limit the possibilities by going with an older wireless technology?

How M2M can save millions:

Actually, Phase 3 is already here in some ways, and there’s one example that demonstrates  the art of the possible. A while ago, Tesla, the leading electric car manufacturer which incorporates a ton of IoT Sensors in each car, needed to change one of the features accessible to owners. This feature allows the driver to lower the car for better aerodynamics, but at its lowest level, the vehicle was more susceptible to hitting objects in the road. Traditionally, a fix would have meant a recall that could have cost millions. But Tesla simply issued an online update that was fed to every car when the owner plugged it in for overnight charging. Within a day or two, and at minimal cost, the lowest available level on every one of those cars was half an inch higher. You can read about it here.

Looking at it from the point of view of a technology enthusiast, the connected car platform is a dream come true, made possible by the incredible advances in M2M technology and capabilities. We, at MobileLive, predict that in the very near future, we’re going to see things most people can’t even imagine now. (connected homes, wearables etc)