We live in an uber-connected, data-driven world. Today’s consumers expect continuous data, instant updates, and products which intuitively fit their needs. Manufacturers are continually pressured to innovate and differentiate their brands to meet these new demands. So what are their options?

For many innovative companies, the answer lies in the Internet of Things, or IoT. These manufacturers are meeting the rising expectations, taking advantage of IoT by integrating smart features into their products and systems. In doing so, they’re not only delivering disruptive smart solutions, but they’re also realizing tangible business benefits along the way.

Here are 8 benefits for companies turning to IoT:

1. Margin benefits

Manufactures are increasing profit margins with consumers and businesses willing to pay hefty premiums for smart products. Products which offer even a basic app to accompany a product are often double the price of similar offerings that aren’t connected –  and companies are finding out that the extra features pay off. 

Ikea is attracting more consumers with voice-control smart lighting capability through Siri, Google Home and Alexa.

2. Brand leadership and Innovation

Leading companies are also innovative companies. Google and Levi’s recently demonstrated how to set a brand apart from the pack with the much-hyped ‘Commuter’ smart jacket. Craftsman, a leading maker of lawn equipment, did the same recently when the company won an Edison innovation award for its smart lawn connected riding mowers.

Launching a smart product allows companies to differentiate their brand with trend-setting products for their industry.

3. Volume benefits

To put it simply, smart products sell more. With so many products connecting to our ubiquitous smartphones and industrial safety standards rising due to technological advances, companies who don’t integration innovative features into their offerings will find they sell less as time goes on. 

Smart baby rocker company 4moms doubled sales for four years in a row.

4. Create long revenue streams

With smart products, you can increase the lifetime value of your customer by suggesting the next logical purchase or upgrade, setting up automatic alerts for replacing parts and gaining insight from analytics to know when they are ready to spend next.

The Oral B Genius. Users get feedback on their brushing from the app – which can also send them alerts from the manufacturer.

5. Turn products into service

A product is larger than its physical dimensions. Digital services create value for a product in market, such as a subscription model to unlock premium features. The addition of services enables companies to leverage data to find new business value and enhance their product or system.

6. Revitalize products

Products are getting revamped with smart features that improve functionality for users. Updating product software revitalizes the product and keeps it relevant for longer.

7. Create new business models

IoT provides companies with new business models that increase the value of their offering and encourages customer willingness to spend. These opportunities open up a range of possible business models to grow the top line.

8. Understanding product usage

Smart products and systems give insight into how a user behaves and what they want out of the product. This allows companies to build an authentic relationship with users based on value.

With so many ways to drive ROI and take advantage of new channels of business value, it’s no wonder that everyone from consumer goods companies to industrial manufacturing giants are turning to smart products and systems.