[GRIT COMMENTARY] Understanding the Path to Purchase in the Age of IoT

In our increasingly tech-driven world, the lines between human communication and everyday objects are blurring at a herculean rate. This blending has its own label, “The Internet of Things,” also known as IoT. But what is it exactly? And why should marketers and marketing researchers care?

IoT isn’t a new idea; it’s been around for at least 25 years. Like all great ideas, the time had to be right. Advances in radio frequency identification (RFID), the miniaturization of data collection devices, and cellular communications have made IoT cost effective and scalable. With the wide-ranging availability of broadband internet access, “being connected” is also getting less expensive. Wifi hotspots are nearly everywhere and our Smartphones dutifully connect on demand. The development of newer, faster, better technologies – apps, sensors, and new “wearable tech” is exploding. We are always “on,” always discoverable, and ostensibly joined at the hip with the rest of the world.

With all this technological coziness, it was only a matter of time before our connectedness with each other morphed into connectedness with things.  According to research Toluna recently conducted with consumers, 51% want to use IoT devices of some sort with security devices (home alarm, etc.), home appliances (smart refrigerator), and healthcare apps that communicate with the consumer and each other topping the list.

Marketing researchers aren’t exempt from this desire; 40% indicated they are using or considering using IoT in the Q1/2 2016 GRIT Report, which is a significant increase from the Q3/4 2015 GRIT Report.  What market researchers are seeming to understand is that while data is important, insight is of the utmost importance when understanding the ‘why’ behind the ‘what.’ 

Further, the concept of IoT brings about its own host of marketing challenges.  For example, if a refrigerator can sense the milk carton is almost empty and orders more from the store, how can marketers influence the brand purchasing decision? The assumption made by the refrigerator is that the milk brand bought last is the milk brand to buy again. Direct consumer input is reduced – or not a factor at all.  If this logic expands to other products, consumer purchasing can be forever changed. Suddenly getting through store shelf clutter isn’t the problem for brands – it’s getting the consumer to go to the store in the first place.

A 2014 Pew Research report explored the ramifications and opportunities that IoT will offer and hypothesized its impact on our lives ten years out. At the root of the issue is the ability of IoT to influence consumer behavior. According to the Pew report, IoT will likely utilize incentives to encourage behavior change, whether that change is to purchase a good, have healthier habits, or use public services more effectively. Supporting this belief is Laurel Papworth, a social media educator, who stated, “Every part of our life will be quantifiable, and eternal, and we will answer to the community for our decisions. For example, skipping the gym will have your gym shoes auto tweet (equivalent) to the peer-to-peer health insurance network that will decide to degrade your premiums. There is already a machine that can read brain activity, including desire, in front of advertising by near/proximity. I have no doubt that will be placed into the Big Data databases when evaluating hand gestures, body language, and pace for presenting social objects for discussion/purchase/voting.”

This content was originally published by Toluna . Visit their website at www.toluna-group.com.