The Internet of Things (IoT) is poised to explode in the coming years, and B2B companies and manufacturers should get in the game now to reap the biggest reward.
- Market spend will grow from $625.2 billion in 2015 to $1.29 trillion in 2020
- There will be a compound annual growth rate (CAGR) of 15.6%
- The installed base of IoT endpoints will surge from 12.2 billion at the end of 2015 to more than 30 billion by 2020
Ultimately, it’s obvious that IoT is very much the future of both the B2C and B2B world. So what does—or can—this mean for B2B companies?
Manufacturing is Ripe for IoT
Manufacturing is one of the more obvious fits for IoT, as interconnected systems and sensors produce real-time data analytics, more efficient processes, and lower manufacturing costs per unit.
Image via Business Insider
In fact, there’s even a term for IoT in manufacturing: Smart manufacturing, defined by Business Insider as “the use of IoT devices to improve the efficiency and productivity of manufacturing operations.”
The article goes on to explain that this typically involves retrofitting sensors to existing manufacturing equipment, “but new manufacturing equipment often comes with IoT sensors pre-installed.”
Those utilizing IoT are reaping the rewards: In 2014, manufacturers using IoT saw a 28.5% increase in revenue over the previous year.
And companies are starting to notice. BI Intelligence, Business Insider’s research service, “expects the installed base of manufacturing IoT devices to swell from 237 million in 2015 to 923 million in 2020.”
The Possibilities for Other B2B Companies
But manufacturing isn’t the only B2B industry that stands to benefit from IoT. According to another report, this one by McKinsey & Company, the economic impact of IoT will be $11.1 trillion per year by 2025, with users (organizations, companies, consumers, etc.) enjoying 90% of the value created. What’s more, an estimated 70% of that value will be generated in B2B applications.
Ultimately, businesses that invest in developing data analytics and modeling capabilities that can be integrated with existing systems will increase efficiency. What’s more, they’ll improve customer experience by means of making customer onboarding smoother and enhancing overall customer lifetime value.
That’s because access to all of this data means understanding the usage pattern, which in turn can help companies optimize products, time upsells and cross-sells, create more in-depth and accurate service agreements, and more.
Overall, IoT can help B2B companies be more productive and efficient while delivering a better customer experience. And modern technological solutions like CPQ can help businesses realize this potential.
That’s because CPQ allows organizations to deliver features and functions across channels that make for a pleasurable user and buyer experience. This ultimately results in cut costs, improved margins, greater user adoption, increased customer loyalty, and more revenue.
It seems the question now is: What can’t you do with IoT?