The Customer of Things

Simon Watt 213573083

The Internet of Things (IoT) promises a revolution in how consumers engage in commerce.  Will our lives become easier, or more complicated, and what are the broader implications for our society?

Promising Things

IoT promises a great deal in terms of convenience for all of us.  Products such as the Nest thermostat that learn our routine, and know where we are, to device controlled light bulbs and even smartphone connected nappies promise a future of ever increasing customisation, comfort and immersive product experience.  But what does this mean for businesses that hope to ride the crest of this technological wave?  How will they need to adapt to ensure a positive customer experience and the value exchange is maximised on both sides of the relationship?

Ding ding (incoming text message) your daughter has done a poo.

Ding ding (incoming text message) code brown alert!

Business Things

For business, IoT products offer the opportunity of ongoing revenue through devices that are able to predict needs and address them, as seen with this detergent ordering washing machine.  We are spared the agony of choice (Broniarczyk and Griffin, 2014) and instead simply press a button and our washing detergent will arrive.  While this may be ideal for low involvement products such as laundry detergent, allowing your washing machine to buy your next car may not be such a good idea.  But read on …

IoT devices will allow for ever more information to be gathered about us.  This (big) data when harnessed via customer relationship management (CRM) systems presents the opportunity of personalising business/customer interactions on a level never before possible.  Let’s imagine you are standing in a car yard dubiously listening to a salesman’s pitch and your phone pings to inform you a competing brand car manufacturer is offering zero financing and will price match similar models to the car yard you are currently standing in.

The ability to tailor customer interactions and to anticipate needs will significantly enhance engagement, and generate greater customer lifetime value (Jackson, 2007).  But is the picture all rosy, or is there a darker side to big data?

Risky data?

Risky data?

Risky Things

Prescient awareness of customer needs requires a level of knowledge that may be perceived as invasive by some.  A cultural change needs to occur both within business and society to adjust to the increasing information that will be gathered on consumers.  Will society accept this as the new norm, or will there be a strong and vocal backlash?  Business will be wise to be aware of this risk as consumer emotion is a powerful force that can turn a brand zealot in to the most strident of critics as Coca-Cola can attest.

Businesses are facing a paradigm change and the learning curve associated with this brave new world will be steep.  Hacking of IoT products, data theft, increased security costs, and new product development cost and time blow-outs all present as potential pitfalls to companies hoping to reap the rewards of innovation (Rossi, 2016).  Business must contain this risk to ensure customer satisfaction, the bedrock that success relies on.

Satisfying Things

Whether a customer is satisfied or not results from the comparison of their expectations with their experience (Iacobucci 2013).

Customer evaluations = experiences - expectations (Iacobucci, 2013)

Customer evaluations = experiences – expectations (Iacobucci, 2013, p 185)

The early adopters who initially dip their internet toe in things make up 13% of the population (Sakurai, 2016).  Understanding this segment is the key to ensuring successful adoption of innovative products.  Only once this segment is won-over will products progress towards mainstream adoption (Moore 2006 cited in Sakurai 2016).

Innovation adoption lifecycle (Sakurai, 2016)

Innovation adoption lifecycle (Sakurai, 2016)

Early adopters are driven by an interest in innovation, novelty and status (Sakurai 2016).  This fits nicely with the fourth level of the Maslov (not to be confused with Pavlov – woof!) hierarchy – esteem needs (Kalliath et al, 2014).  Understanding, meeting and exceeding these expectations across all stages of the purchase process will maximise sales and ensure a positive customer experience.  If the company is lucky, these satisfied early adopters are emotionally engaged with the brand and become ambassadors generating significant amounts of positive word of mouth.  The power of word of mouth has long been recognised as a highly effective marketing tool (Hogan, Lemon and Libai, 2004) and will help to drive IoT products towards impressive growth.

Final Things

To borrow from Marianne Williamson “Change is in the air”.  Some go so far as to say the IoT is a revolution waiting to happen.  A new era of convenience, comfort and customisation awaits us.  Interactions with business will be more personalised than ever before.  But does this come at a cost?  Will our privacy and anonymity be eroded to realise these benefits?  Will we embrace this revolution and experience, or be dragged towards it kicking and screaming?  Time will tell.



Broniarczyk, S, and Griffin, J, 2014, ‘Decision difficulty in the age of consumer empowerment’, Journal of Consumer Psychology, Vol. 24, no. 4, pp. 608–625.

Hogan, J, Lemon, K and Libai, B, 2004, ‘Quantifying the ripple: Word-of-mouth and advertising effectiveness’, Journal of Advertising Research, Vol. 44, no. 3, pp. 271-280.

Iacobucci, D, 2013, Marketing management (MM4), 4th Edition, Roche, M, Cengage Learning, United States of America.

Jackson, T, 2007, ‘Personalisation and CRM’, Journal of Database Marketing & Customer Strategy Management, Vol. 15, no. 1, pp. 24-36.

Kalliath, T, Brough, P, O’Driscoll, M, Manimala, M, Siu, O & Parker, S 2014, Orgnaisational behaviour: A psychological perspective for the Asia-Pacific, McGraw Hill Education, Australia.

Rossi, B, 2015, Four unexpected implications arising from the Internet of Things, Information Age, retrieved 27 July 2016,

Sakurai, S, 2016, The psychology of the early adopter, Saren Sakurai, retrieved 27 July 2016


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