Navigant Research Blog

Can IoT Redefine Your Shopping Experience?

— February 9, 2017

CodeThere is a lot of hype surrounding the Internet of Things (IoT). The challenge this presents is in deciphering how an IoT solution can deliver better information—not just more data—and tackle specific pain points that lead to customers entertaining a new investment. Navigant Research believes the significant benefits associated with IoT are transforming commercial facilities into intelligent buildings; two specific business benefits of IoT can be highlighted by exploring the application of IoT in retail spaces.

First, IoT can help shoppers spend where their dollar aligns with their green priorities. In 2015, Nielsen released the results of a global survey that demonstrated a shift in willingness to pay and purchasing trends among millennials, the largest segment of the population. About 72% of respondents reported they are “willing to pay more for products and services that come from companies who are committed to positive social and environmental impact.” This was an increase of 17% from 2014—if the trend continues into 2017, close to 90% of millennials will be putting their green where the green is.

Demonstrating Sustainability

IoT can be the technology backbone to qualify the sustainability claims of retailers. Accurate tracking of energy consumption and equipment performance made possible by IoT infrastructure can help retailers quantify their efforts with data. Energy efficiency efforts can be monitored and verified with real-time data to inform annual reports and marketing efforts on sustainability.

Second, an IoT solution can improve the shopping experience by improving customer service with data-directed sales support. An IoT solution can provide retailers with detailed data on customer traffic, illustrating the flow of customers throughout their stores and even the time spent browsing in specific locations. If store managers utilize this data, they can be proactive about staffing and create new strategies for product placement and incentives to move customers throughout their stores. The efficiency of speedy checkout and the product placement enhanced by this occupancy data can help enhance the shopping experience, which suggests a new avenue to create return and long-term customers. Carrie Ask, Levis’ EVP and president of Global Retail, recently explained the concrete benefits of deploying IoT solutions. “On the opportunity side, we were underestimating the potential within our store traffic to drive sales and conversions. … And on the stakes side, we also realized that when we’re out of stock, not only do we lose in the moment the chance to drive a planned or impulse purchase, but the disappointed consumer may decide that the trip to the store was not worth it—jeopardizing future traffic,” she said.

Interested in hearing more about the role of IoT in retail? Join Navigant Research along with Rick Lisa, Director of IOTG America’s Sales at Intel; Greg Fasullo, CEO at Entouch Controls; and Craig Robinson, Partner at Traverse Ventures Partners for a roundtable conversation exploring how the IoT is redefining the retail experience on February 14 at 2 p.m. ET. Click here to register.

 

Tackling the People Problem: Another Promise of IoT

— December 2, 2016

The intelligent buildings market has been defined by the convergence of controls and automation and information technologies. The competitive landscape has shifted as software analytics have become foundational to commercial building optimization. The technology is ahead of the curve when considering the business transformation these solutions can enable. There is a huge addressable market for intelligent buildings, but executives, building operators, and facilities managers are still learning the business value and practical implications of technology deployment. The chasm between technology and user maturation can be thought of as the people problem; Ian Campbell, technologies services director at Grosvenor Services, clarifies the point: “The concept of a smart building is meaningless unless you apply Technology, People, and Process. It’s nothing without people.”

IoT Enablement

Facilities management is not the cutting edge of technology adoption. Even as the intelligent buildings market has developed, customers have been conservative in implementation, learning through pilots and demonstrations of business value. The Internet of Things (IoT) is changing the game for the intelligent buildings market with dramatically lower total cost of ownership, ease of deployment and implementation, and broad business effects. That IoT solutions can deliver value to stakeholders across an organization while meeting their technology and investment requirements sets the stage for a tipping point for more widespread and rapid adoption.

Beyond Energy Efficiency

Customers need to see a rapid return on investment (ROI) to make the commitment to intelligent building solutions. The energy efficiency gains of intelligent building technologies provide the easiest demonstration of ROI, but for many customers, this falls short. The information delivered by an IoT solution is much more wide-reaching.

IoT-enabled intelligent building solutions create rich data sets about commercial buildings. Software analytics translate this data into business information that can tackle key pain points across an organization. For example, occupancy trends can help the building engineers fine-tune heating, ventilation, and air conditioning systems to increase comfort and improve repair and maintenance processes. That same data can be translated into information about occupant behaviors that define productivity for business profit.

Digital Lumens recently explained another business benefit of IoT—physical security. “To further maximize security, managers are also utilizing occupancy sensing data to create virtual fences around particular areas within a facility, sensing and alerting the manager in real-time if any trespassing has occurred,” said Kaynam Hedayat, VP of product management and marketing with the company.

The bottom line is that IoT intelligent building solutions help customers make data-driven business decisions, create time-saving improvements in maintenance and repairs, and improve the employee and customer experience. These benefits mean stronger financial statements and new budgets for technology investment.

Interested in additional Navigant Research perspective on IoT? Check out the new IoT research service.

 

Two Big Reasons 2017 Looks Bright for Intelligent Buildings

— November 30, 2016

Intelligent BuildingInformation technology has permeated nearly every aspect of our daily lives, and the convenience, efficiency, and productivity benefits of utilizing our favorite apps has created a new set of expectations for workspaces. As we look to the beginning of a new year, this widespread demand for technology underscores two signals that 2017 will support continued investment in intelligent building technologies. First, customer satisfaction is paramount;  second, major corporations remain committed to sustainability. Intelligent building technologies, specifically Internet of Things (IoT)-enabled analytics and managed services, are cost-effective investments that provide broad business insights to meet these two top line goals.

IoT for Customer Satisfaction

The bottom line for business is growing revenue and building market share, and customer loyalty is fundamental to this success. IoT-enabled intelligent building solutions can help businesses by creating comfortable and productive space. From retail stores to offices, intelligent building technologies help facilities managers and building owners maximize equipment performance and direct the use of their spaces to maximize customer satisfaction.

Navigant Research recently hosted a roundtable webinar on IoT for small and medium businesses, and the conversation several times turned to the importance of customer satisfaction. The deployment of an IoT-enabled intelligent building solution can generate comprehensive data sets on equipment performance and space use, and analytics can then translate these data streams into valuable business information. For example, in retail stores, occupancy sensors can send data about foot traffic to direct improvements in HVAC and lighting for energy savings, but also provide insight for product placement and customer service needs that can ensure and enhance customer satisfaction. Once an IoT platform has been deployed, there are many software as a service (SaaS) analytics options to translate data into information for strategic business decision-making for any vertical.

IoT for Sustainability

According to a recent Forbes article, a recent international manufacturing conference in Japan provided some surprising new statistics on sustainability. In particular, the study found that 75% of US consumers account for sustainability while shopping, and an even more striking 7 of 10 millennials define themselves as social activists—as put in the conference presentation, “For millennials, CSR [corporate social responsibility] is the new religion.” Even more striking is the corporate commitment to combating climate change, underscoring the importance for business bottom lines. Companies including the Gap, General Motors, Levi Strauss, and Starbucks have signed a plea to the incoming administration to retain the commitments set in the Paris Climate Accord.

What does this mean for intelligent buildings? US businesses can tackle their sustainability footprint head on by optimizing operations to reduce energy consumption and associated carbon emissions.

Commercial buildings are notoriously inefficient, generating about 20% of the total CO2 emissions in the United States. IoT changes the game by delivering cost-effective devices (moving price points from tens of thousands of dollars to hundreds of dollars) that bring insight into waste that was previously invisible. Customers that manage smaller buildings likely never considered deploying automation and controls for energy management and sustainability, but with the IoT platforms and SaaS analytics available today, they can access facility information remotely, quickly identify inefficiencies, and improve performance to improve their sustainability.

 

The Digital Transformation of Buildings: Creating Business Value, Not Just Data

— November 2, 2016

Intelligent BuildingThe ubiquity of unstructured and real-time data streams has the potential to revolutionize business. Consumers expect technology to make their homes more comfortable, their schedules more productive, and their travel more efficient. The unyielding pressure to be connected is beginning to transform expectations for how commercial buildings are operated. The challenge is now to align occupant and business expectations with real estate and facilities management realities.

Navigant Research has been tracking the development of the intelligent building industry and specific innovation through the convergence of IT with commercial building equipment and controls. Energy efficiency has been the bedrock of market development because the improvements in operations translate into reductions on utility bills—a transparent monetization of return on investment. The energy story is a critical starting point, but it is only part of the promise of intelligent building technologies. As the market continues to mature, a more comprehensive story is unfolding around the business value of digital transformation in commercial buildings.

IoT for Bigger Impact and Better Decisions

The Internet of the Things (IoT) characterizes an important shift in positioning technology for improving commercial building operations. The fundamental idea is that IoT is a platform approach to data creation, communications, aggregation, and analysis. It’s about creating data-rich environments for a more comprehensive view of what is happening inside the walls of a commercial facility to make better decisions. The ability to translate the data into information that resonates across business units and stakeholder points of view is what’s really impactful about IoT in commercial buildings. In other words, one IoT intelligent building solution can address big business pain points—energy efficiency for the head of sustainability, predictive maintenance for the head of engineering—while also generating enterprisewide key performance indicators (KPIs) for the C-suite.

There is a big-picture opportunity here. When IoT-enabled intelligent buildings are a reality, the benefits are wide-reaching. As explained in a recent Huffington Post article, “It is through a change in mindset, enabled by the Internet of Things, that buildings become smart. If we get buildings right, we get the energy system right. … Smart buildings reduce the cost of the energy transition—both upfront, as smart buildings allow fewer investments in new power capacity, and on an ongoing basis due to less energy consumption and integration of renewables such as surplus energy from other parts of the city.” Navigant Research agrees. In fact, we have been outlining the importance of buildings in our ongoing research into the energy industry transformation, or as we frame it, the development of the Energy Cloud. In our most recent Energy Cloud white paper, we discuss this very idea as Building2Grid. Watch for more on this big-picture idea for the intelligent building in the coming months.

Interested in learning more about Navigant Research’s IoT research? Check out our new IoT research service here.

 

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