The Internet of Things is set to revolutionise consumers’ lives, that much experts are sure. But what impact will it have on brands and agencies? Laura Bracher takes a closer look.

Never before in the history of technology has a hypothetical dairy product been mentioned so often, and by so many people.

I am, of course, referring to the Internet of Things (IoT) go-to case study: the fridge which automatically senses a carton of milk running low and orders a replacement, in time for delivery before the consumer returns from work.

Even as a something of a tech-savvy millennial, I still find this a pretty far-fetched idea. Yet it appears we are much closer to this scenario becoming a reality than many would assume – as long as technology companies, brands and agencies find a harmonious way of working together that places the consumer benefit at the heart of all they do.

A quick look at the numbers is encouraging: research firm Gartner predicts that, only five years from now, 25 billion connected “things” will be in use. Tech companies already have “a massive head start” in being able to control these connected “ecosystems”, according to David Towers, EMEA digital partner and head of search, at MEC Global Solutions.

You have probably seen in the news that Google is withdrawing its Google Glass device from the market. While the Glass geeks make their way back to the drawing board, the company has been finding profound success in other areas, such as with its Nest Labs business – purchased at the beginning of last year for $3.2bn.

Nest, originally known for its ‘smart’ thermostats and smoke alarms, has now opened up its platform to work with other devices. It has already signed up 12 pretty cool product partners ranging from smartwatches and lightbulbs to ovens, paving the way for a host of products to enter our homes using Nest’s interface, reckons Dianne Wilkins, chief executive at Omnicom digital marketing agency Critical Mass.

“They are credibly positioning themselves as the Google hub for the home—not least because Google acquired them,” adds Wilkins.

Healthy living

Not only do these connected devices make our daily routine more convenient, but they may also help us to live a better, healthier life, especially when wearable tech is involved.

“Apple Watch is exciting,” says Jean-Paul Edwards, EMEA director of strategy and product development at OMD. “The strongest area will be around health signals. Medical and fitness products and apps

will be able to monitor our movements and heart rate all day.”

Fitness apps and bands are nothing new to the market; it’s the thought of how they fit into a totally connected future that makes them really exciting.

Edwards believes that the anticipations stems from the idea that tracking our movements and payments will lead to a future where our grocery shopping is done automatically, based on day-to-day activities. While this might not happen with the first generation technology, it could do with the fourth, he adds.

Others dial up the hyperbole even further. Wearables are “transforming the relationship between humans and technology”, says Alexander Mahernia, chief creative officer at consumer engagement agency Rosetta. We are entering a world of digital pay and voice-activated assistance which will eventually promote a seamless integration into our daily lives, as these devices become a “natural extension of human bodies”, he says.

Data, data, and more data

If the impact of IoT upon consumers is certain to be substantial, how about brands and agencies?

Most marketers understand that we are quickly moving towards an industry that revolves completely around data. Tech companies such as Apple and Google can use the data from smart devices and wearables and turn them into meaningful and useful services for consumers.

Firms can build a far more detailed understanding of consumers’ lifestyle and health, and a general “worldview of their audiences”, says Towers. Access to this kind of information has become invaluable to marketers, allowing brands to make communications more targeted and relevant.

Global consumers live in an omni-channel world, and enjoy media differently to previous generations. They will start to expect more meaningful interactions with brands based on preference and personalisation.

“Consumers are demanding brands to have a deeper understanding of their needs and aspirations, but most importantly to engage based on their choice of time, location or interest,” adds Mahernia.

Yet the debate around data privacy is far from settled, especially in regions such as Europe, where the authorities have used it as a stick with which to beat corporations.

Big Brother is watching?

Some surprising, or perhaps unsurprising, news arose last week when it was reported that Samsung’s SmartTV may be listening in to the conversations taking place around it.

The device allows owners to control their TV using voice commands, rather than relying on a classic remote control. So far, so good, you would think. But, in a development straight out of George Orwell’s ‘Nineteen Eighty-Four’, it turns out the SmartTV pays attention to more than just requests to change channel.

Samsung’s terms and conditions state: “Please be aware that if your spoken words include personal or other sensitive information, that information will be among the data captured and transmitted to a third party.”

Before you resort to whispering when watching Netflix, Samsung’s policy of collecting conversations seems mostly to be an effort improve the TV’s performance and make it even smarter. Nonetheless, with stories of leaked data becoming a regular occurrence, it is probably a good idea for brands and agencies be cautious.

On top of this, marketers must learn to understand that their advertising will vary according to target demographic. For example, Anne Cecile Michaud, global head of strategy at Havas highlights there is a growing number of millennials extremely aware of the potential risks of being too connected to brands.

Smarter cities

Another issue that we have to tackle before IoT can truly become a widespread and operational pillar of our lives, and leave us living in a world of “smart cities”, is connectivity.

“Today, the primary challenge is the lack of a universal communication protocol across all devices” says Rosetta’s Mahernia. Manufacturers are creating closed networks for security purposes, but true smart home automation will require a centralised hub into which all devices integrate and communicate, he explains.

“While we are starting to see some standards emerging around home automation, such as Z-Wave and ZigBee, consumers are still missing simple and intuitive ways in which all the connected devices within the home interact together seamlessly,” says MEC’s Towers.

Such shortcomings in digital infrastructure are, for the time being, a setback in our move towards a more connected future. Until tech companies begin to open up, the idea of devices in our homes working seamlessly to provide us with a more convenient way of living has to be put on hold, leaving brands and agencies left waiting for the valuable data on offer.

The technology needed for IoT is well on its way, but technology companies are going to have to work together more efficiently and openly in order for this to succeed. Brands and agencies will benefit, but only by recruiting the right digital talent to create positive relationships with consumers, and only if they tread carefully when it comes to data and transparency.

Many ifs and buts, then, before IoT becomes the reality so many are convinced will transpire. In the meantime, consumers will have to continue to replace that carton of milk themselves.