Billions of connected devices will lead to unbelievable amounts of data –which can lead to new business opportunities for companies agile enough to take advantage of the situation. Jason Mann, director of emerging solutions and product management for SAS, a leading provider of business analytics software and services, shares how companies can capitalize on Internet of Things (IoT) opportunities from both efficiency and revenue generating perspectives.
Below is an edited transcript of the conversation. To hear the full interview click on the embedded player at the bottom of this page or see the video interview here:
The Internet of Things (IoT) and IoT Data
Small Business Trends: Give us a little bit of your personal background and then give me your definition of Internet of Things.
Jason Mann: It really is sourced from the origins of the data; device level data. The idea of monitoring devices, measuring devices and their connectivity to the Internet. And the ability to to pull that data in for additional assessment and analytics.
We also have a perspective of continuing to push decisioning and analytic insight closer to the edge and the source of the data and will do that as we continue to see the measurement devices and aggregation devices expand with respect compute storage capacity.
Small Business Trends: You have thousands of customers and they’re focused on marketing and analytics. When it comes to IoT data where do you think they are currently and where you think they should be?
Jason Mann: I think you see a vary greatly by industry. You have some industries that have a long history and experience with device level data, with monitoring data in motion or streaming data; industries like energy for example where the focus on grid reliability have driven the need to monitor the stability throughout the entire grid in close to in real time as possible. So those industries are more mature. They have a broader competency in dealing and finding insights from streaming data.
You have some people that are just starting to enter the space; retailer is a great example of that. Everyone’s familiar with some of the new beacon technology that’s out there and maybe even encountered it within the stores. So that technology is continuing to expand; the technology surrounding the beacons with the ability to identify unique signature to a customer’s mobile device. They talk about a digital fingerprint from your MAC ID, from your Bluetooth, from your wifi signals from the phone. So there’s a lot of forward looking capabilities of being able to consolidate an omni channel view to your consumer. But then link that to a locational awareness for your consumer as well to help with realtime promotions or message interaction to a customer.
So you see it at different ends of the spectrum. And if we look out two or three years you’ll see wider adoption and deployment. And then for those that that have existing capabilities or existing experience they’ll continue to refine and expand and find new use cases. I think that is the critical element though for all the industries that are looking to leverage the opportunity that is IoT is to define use cases because it’s only there that you’re able to provide a return, provide an improved customer experience, customer satisfaction, efficiencies that IoT promises – that everyone hears is really rooted in specific industry level use cases.
Small Business Trends: Is it being driven by looking for efficiency gains? Is it being driven by actually trying to improve customer experience. Is it both?
Jason Mann: You’ll see a mix of that and again you’ll see variation across industry. Another example that I use is I think everyone by this point has encountered the insurance commercials that talk about attaching a dongle and they’re able to evaluate your driving habits.
I have an 18-year-old and it’s a huge upside for me to be able to track his his driving habits. But that’s a new business model for them; it provides an additional insight that three years ago wasn’t available, wasn’t even a concept that they could consider. So not only does it bring the ability to engage their consumer more directly in the fact you get sticky because they can reduce their rates, they have better insight to their overall projections for risk assessment. So in those cases you have both sides of the equation, an opportunity for some top line growth and opportunity for efficiencies within the business model. But then you do have some of the industrial markets that you see utilizing IoT data today. It really can be focus on quality or yield improvement or manufacturing processes that seems to be the bulk or at least the majority of the initiatives in the retail. Again going back to the early example, it can be about top line growth generating that promotion, squeezing out a bit more revenue from the existing customers based on your understanding of their buying habits, and then adding that additional last mile IoT provides knowing where they are within the store or along the road in proximity to your route.
Small Business Trends: What kind of companies tend to see initial benefits of IoT first?
Jason Mann: As everything with IoT we see a mix there. If you think about those fast movers, innovators, you look at it wearables, you look at the smart home and all the devices that are trying to push there. You have a lot of players that are trying to monetize that with things like Google Nest; and your cable provider is looking to provide some additional services that may be attached to security or insurance within the home. Most recently we were just talking to a customer that has been making power panels for the home. But what they found is that they can generate additional insight from just the current that moves the line, about the preventive maintenance of the devices themselves. Potential issues with failures of the electrical system resulting in home fires. They’re even looking to be the hub of that home monitoring service. So there’s new companies that are moving quickly into the space with wearables or smart devices within the home. And then there’s older companies that are mining for additional top line revenue opportunities as well. It truly is a mix.
Small Business Trends: How quickly do companies have to start not just thinking about this but actually implementing IoT technology and strategy before they get left behind?
Jason Mann: I think if you’re not thinking about it now you are being left behind. In 2014 IoT was at the pinnacle of hype but even at that point the projection is within five to seven years for real revenue returns within the space, and I think they’ll adjust that over time because I think if it’s moving a bit more rapidly. So if you’re not starting on the journey now it’s going to pass you by in two to five years. And I do believe that just given the pervasiveness and the deployment that we’re seeing with respect to these devices and the expansion of capabilities of measurement within mobile devices companies will be forced into that. especially on the consumer the consumer side.
Small Business Trends: Consumers adopt technology at much higher rates. They ‘adapt their lives to take advantage of it. And companies not on board with that trajectory stand the best chance of being disrupted.
Jason Mann: I certainly think that’s the case and the insurance example is a great one. So they didn’t just go to the car manufacturers and say we’d like to work with you to get access to data that we think is important. They totally bypass that infrastructure by connecting into the car, or having their consumers opt into linking into their mobile device and immediately without a lot of technical infrastructure a lot without a large ecosystem. They were able to affect their business vision and I think that’s an example that other companies should evaluate. Reduce the ecosystem that you can impact immediately and bring your offering to market.
Small Business Trends: How ready are companies. Not from a technology standpoint. But from a perspective of corporate culture and strategy.
Jason Mann: It is a truly new way to do business for many of the industries that are starting to adopt that. Certainly there’s an infrastructure requirement there’s a resource requirement where those things are limited you’re seeing services pop up some of the early deployments of IoT that present true value will be a cloud element associated with that to reduce the overall infrastructure cost. There’s services or services based options that reduce the requirement to staff up significantly on the resource side. The critical element is let’s think about this in a new way and then we’ll find a way to execute against that because there are a lot of options that are out there available to to our customers today.
Small Business Trends: Where can people learn more?
Jason Mann: SAS.com/IoT.
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.