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How the Internet of Things is Creating a Proliferation of Consumer Touchpoints

Editor’s Note: Today’s post comes courtesy of Jessica Groopman (@jessgroopman), a Senior Researcher at Altimeter Group where she conducts research on disruptive technologies. Jessica specializes in digital strategy, Internet of Things, social data integration, content marketing, and customer experience, with a focus on how data is shifting business models and behaviors.

Marketing is about to get a whole lot more complicated. As the costs of connectivity, hardware, and software services continue to deflate, as access to the internet continues to rise, as device and application innovation fans to every industry, as offline moves increasingly online, the consumer paradigm is shifting.

What’s happening is that this technology is enabling a proliferation of touchpoints, or points at which a consumer interacts with a product, service, or brand. Collectively these emerging touchpoints are redefining brands’ ability to interact with consumers, and consumers’ ability to interact with brands.  

Understanding Touchpoint Proliferation
What exactly do we mean by touchpoint proliferation? Today, we have the ability to digitalize almost anything—this is what is meant by the term, Internet of Things. As a result, traditionally ‘offline’ objects are now being brought online, as connected ‘things,’ new channels, platforms, or tracking mechanisms. Below is an image showing the evolution of consumer touchpoints over time.

Digitalizing ‘things’ creates the opportunity for implicit or explicit dialog between consumer and brand at a personalized level. Each touchpoint is the portal through

which information flows. These dialogs are where the opportunities (e.g. intelligence, communications, service, automation, etc.) lie, both for marketers and other business functions.

 · Explicit dialog is when the consumer can communicate directly with the brand through the product (i.e Amazon’s Kindle’s Mayday buttonPizza Hut’s Connected Table [concept]). The consumer actively participates in this communication, akin to dialing a support number or sending a tweet directly to a brand handle.

· Implicit dialog, on the other hand is largely invisible to the consumer. This is when consumer interaction and/or product behavior is tracked by use and automatically reported back to the brand. (i.e. Coca-Cola’s smart “Freestyle” soda machine; Wearables, any smart device, equipment, or appliance where frequencies of interactions or product functions are digitalized and collected.)

The list in the image above will only continue to grow as technology and integration capabilities evolve. In addition, the rising adoption and culture of smartphones (equipped with a host of sensors) around the globe is building the infrastructure for marketers to leverage these devices for access to individuals, at scale.

Marketers Must Embrace Data Now More than Ever
By bringing online traditionally offline objects, we grant them a data stream, a sort of voice. Complicating this is that the data generated by any one touchpoint is really only a small fraction of the any ‘holistic’ understanding to be gained. Enter Big Data. To make meaning from data, streams are analyzed or integrated in aggregate. Social data, loyalty data, transactional data, CRM data, demographic data, weather data, product data, and a long-tail list of other data sources are typically combined with the data streams of any given touchpoint to derive signal from noise.

Approaching the Holy Grail of Marketing
The result of these evolving technologies and capabilities is that marketers have never been closer to obtaining that proverbial ‘Holy Grail’ of Marketing: right content, right person, right time, right place. Marketers can now observe, measure, and understand consumer behaviors more richly (and more immediately) than ever before. They can use such intelligence to empirically inform (sometimes even automate through algorithms) how they provide service, market to, and interact with individual consumers based on their unique histories and preferences. Technology now enables relationships at a much deeper and personalized level.

But this can’t be mastered overnight. Marketers can begin to think about leveraging emerging touchpoints in two ways:

· Attribution: Continue to hone the organization’s attribution mechanisms. The proliferation of touchpoints assumes connections between the offline and online world. But, without connecting these ‘dots,’ customer and product insights are simply incomplete, rendering ‘one version of the truth’ impossible.

· Research: Conduct research into the lives of your organization’s digital customers through journey mapping, focus groups, product feedback, and surveys. Each segment will have nuanced characteristics, around technology use, lifestyle drivers, privacy concerns, etc. This research should inform behaviors, challenges, opportunities, and gaps between them around which touchpoints can be leveraged for improved customer experience and intelligence.

Remember, embracing new touchpoints also doesn’t mean adopting new technology for technology’s sake. Marketers must zoom out from the mystique of emerging technologies, align programs with the larger digital strategy within the organization, and leverage the technology to serve these goals by bridging gaps and opportunities. 

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