Thanks to the Internet of Things and its counterpart, the Industrial Internet of Things (IIoT), a growing number of both business and consumer-facing products are entering the connected world. An estimated 10 billion devices will be IoT-connected by 2020, a group that goes far beyond smartphones and personal assistants. Toothbrushes, microwaves, printers, vacuum cleaners and blood glucose meters are just a few of the IoT-connected devices that can learn to reorder their own supplies.
But instead of creating the internal systems to capitalize on these ready-made revenue streams, many manufacturers are letting the money flow into third-party vendors’ pockets. That’s a huge mistake. It’s time for manufacturers to wake up and smell the new revenue opportunities.
How much money are manufacturers missing out on?
A lot. Here’s a sample scenario involving a refrigerator — an appliance every household owns and a good example of how much revenue manufacturers stand to gain:
Retail price to consumer: $1,799
Assumed price to the retailer (suggested retail prices are often marked up 35% from the manufacturer’s sale price): $1,170
Estimated cost to manufacture the refrigerator: $500
Gross …read more