Whether it’s a refrigerator ordering a replacement water filter or a car scheduling a service appointment, the number and capability of internet-connected “things” continues to increase. In fact, the 10 billion internet-connected things in use in 2018 will increase by 32.7% in 2019. As this happens, these things will develop the capacity to buy, sell, and negotiate for products and services, with organizations having to adapt to this new reality.
As things become customers, enterprise architects must rethink the notion of what a customer is
The economics of connections — or the interactions between people, businesses and things — is accelerating at a rate never seen before. A key concept of the economics of connections is the idea of economic agents that situationally change the nature of their roles, work and compensation. For example, imagine an economic agent in the role of a customer that is actually an internet-connected thing.
“Economic agents are more than just people and businesses,” says Don Scheibenreif, Distinguished VP Analyst, Gartner. “As things become customers, enterprise architects must rethink the notion of what a customer is and help radically reshape their organization’s customer service, marketing and sales capabilities accordingly.”
Enterprise architects will need to guide their enterprises to develop capabilities for responding to significantly larger numbers of support requests communicated directly by things. The sheer volume and velocity of repair, refill and maintenance requests coming in from everything from connected vehicle engines to connected prostheses, vending machines, vacuum cleaners, security cameras, parking meters and aircraft is set to completely overwhelm the way B2B and B2C customer service organizations function today.
“As the computational intelligence of internet-connected things increases, so will their ability to request more complex support, and the expectation that they’ll be able to receive it remotely, in real time,” says Scheibenreif.
Read more: What Happens When Things Become Customers?
With things as the equivalent to human customers, the entire practice of marketing will need to change. Instead of appealing to emotion, marketers will need to appeal to logic and reason when marketing to things.
It’s unlikely that human marketers will be fast enough to keep up with the volume of things as customers. Instead, we are looking at a future where things market to other things, guided by algorithms and capitalizing on real-time opportunities presented by customer data.
However, as long as things are acting on behalf of humans, marketers must continue to understand human motivators. Human insight and machine insight must go hand in hand.
Enterprise architects will need to help sales organizations operate in a world where things will be at least a portion of their customers. By understanding the algorithms behind the purchasing decisions of things, sales organizations may be able to sell items that they would not be able to sell to human customers.
When things are treated like human customers, traditional sales incentives models and loyalty programs will not work. Algorithms that sell can’t be motivated by a trip to Hawaii, and smart houses can’t be taken to nice dinners as a reward for loyalty. Instead, enterprises will employ smart machines to sell to things and incentivize them with rewards or feedback mechanisms for closing a sale.
“As before, selling to things does not negate the need for human purchase motivators in a B2B environment. After all, if organizations don’t understand the business requirements of the humans ultimately responsible for the purchases, they won’t understand the right information needed for the sales process,” says Scheibenreif.
This article has been updated from the original, published on March 29, 2016, to reflect new events, conditions or research.