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Published: 1/6/17 2:22 PM

Add Value to Your Vertical: The IoT as Product Differentiator

Post by David Dewhirst


Incorporating new technology is a great way to set your offering apart from the competition -- if it makes sense to do so

 I've written before about some potential categories for which the time is right to position your IoT device or offering as the category leader. In particular, the utilities, mining, construction and real estate / rental industries still appear to be surprisingly under-invested in IoT solutions:

early_adopter_IoT.png

I thought of this data as I was reading about other data in an interesting article on REALTORMag.com titled "Using Smart Home Data in Real Estate Sales". In that piece, author Meg White points out that home sellers in the upscale Miami markets are proactively installing IoT devices as they get ready to put their homes on the market. The devices are typically low-cost and easily installed -- Nest thermostats, WeMo switches, etc. -- but they serve as differentiators for the product ultimately on offer: The home itself. 

Of course, large-scale industry investment in IoT / M2M technologies is a huge economic engine that will drive IoT adoption rates towards the tens of billions of devices projected to be online by 2020, but it's individual, small-scale adoptions that will actually diffuse the technology and help to make it ubiquituous. It's also by keeping an eye on those small-scale adoptions that you may be able to see where your own business can add value for customers by adding IoT functionalities, and thus differentiate yourself from your competitors just like White's forward-thinking homeowners are attempting to do. 

Not every possible differentiator is great, though -- having a grossly inferior product will differentiate you, for example, but there's obviously no value (or worse, negative value) in such differentiation. Rather, focus on the value-added differentiator you can discover at the conjunction of three different areas, again as exemplified by our intrepid home sellers:

It's something your competitors' product or service doesn't have, like being the only home for sale with a Nest thermostat
It's something that potential customers or clients will find useful and/or valuable, like the Nest's smart functionality and attendant savings, and
It's something that you can rapidly and inexpensively retrofit onto an existing product, like replacing an existing thermostat with a Nest.

Regardless of what shape your own business's IoT differentiator takes, it's time to move on it if it's truly something that makes sense to pursue. As more and more products and services become IoT-connected in the coming years, added smart functionality will flip from being a differentiator to simply being table stakes -- so get your seat in the game now, while you can still easily dominate the table.

 


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