Just over a month ago, Apple finally launched its first, long-awaited wearable device, the Apple Watch. The watch sold out within minutes of becoming available for preorder online, and by the end of the day, the “expected ship-by date” had moved well into the summer months. By the time this story runs, Apple devotees will at last be celebrating the arrival of their new gadget, a piece of technology that analysts believe will mark the true beginning of mainstream wearable device adoption among consumers. But the wearable trend is only a small part of a greater phenomenon. Ready or not, the Internet of Things has officially begun.

According to Gartner, there will be 4.9 billion connected things in use by the end of 2015; by 2020 that number will grow to 25 billion. From wearable fitness trackers to smart thermostats, the Internet of Things presents connectivity potential to a vast number of devices across a range of industries, including retail, healthcare, insurance, financial services, and many others. And where the fast adoption of smartphones and tablets had companies worrying about how to handle the data boom, the arguably faster adoption rate of IoT-enabled devices has some companies “downright scrambling,” Gartner analyst Frank Buytendijk said at the Gartner Business Intelligence Summit in March.

Though bracing for the Internet of Things is daunting, most high-level preparations should involve building a unified strategy for connecting devices, data, and development of apps—the three Ds of the IoT. 

Devices

With traditional objects becoming digitalized and connected, ensuring that these devices connect not only to the Web and the cloud but also to each other has become crucial. It’s not enough to have a digital smart screen in a store or showroom, for example, unless it can sync to a customer’s smartphone, smart watch, or other wearable device, says Loni Stark, senior director of strategy and product marketing at Adobe. To create a worthwhile experience that fully leverages the value of having connected things, “the things have to be in conversation with each other,” Stark explains. At the Adobe Digital Marketing Summit in March, the vendor introduced an “industry first” feature for its Experience Manager suite of applications that does just that—facilitates a dialogue between digital devices. 

The new tool, Adobe Experience Manager (AEM) Screens, gives consumers the flexibility to start their customer journey on one screen—be it a mobile phone, a smart watch, or other device—and continue the journey on a different one. By flicking the display from one AEM-enabled screen to another, the consumer is able to not only connect experiences on disparate digital channels but also bring digital experiences into the physical realm. 

For example, if consumers have already spent time browsing for items and customizing them using a brand’s mobile app, they don’t want to have to repeat the process at the store. If the brand’s brick-and-mortar locations are equipped with AEM screens, they can just “throw” the image onto the screen in the store and show a sales representative on the floor the exact item they want, Stark explains. 

Adobe customer Under Armour debuted the feature at the Digital Marketing Summit using a smartphone and a TV screen, but the tool works just as well sharing the display between, say, a smart watch app and an in-store iPad. And it’s not just a resource for retailers—Stark maintains that use cases span industries. A driver interested in a new car insurance policy, for example, can come to a location and transfer the quote she’s viewing on her mobile device to an agent’s display screen instantly.

“There’s a lot of talk about how these ‘connected things’ are going to serve as new pathways for personalized interactions with customers, and that’s very true, but if these channels are disjointed, the interactions will be repetitive or irrelevant,” Stark says. “Before you can even think about customizing and personalizing experiences across different channels, you have to ensure that those channels are connected,” she adds.  

Other vendors have made IoT investments that reach beyond traditional screens. A market with huge potential for IoT innovation is the automotive industry; with more than 100 million vehicles shipped annually, connected cars present a vast opportunity, Oracle CEO Mark Hurd noted at the company’s Modern Customer Experience conference in April.

“The connected car is already a reality, and in-vehicle wireless connectivity is rapidly expanding from luxury models and premium brands to high-volume midmarket models,” James Hines, research director at Gartner, said in a statement. “The increased consumption and creation of digital content within the vehicle will drive the need for more sophisticated infotainment systems, creating opportunities for application processors, graphics accelerators, displays, and human-machine interface technologies,” Hines added. Though Hurd offered few details, he insisted that Java, Oracle’s standardized software platform for machine-to-machine communication, will play a key role in adding this kind of technology to cars. 

Data

Though vendors have made strides in helping companies build sophisticated networks between devices, connecting things is one part of the challenge. Despite the buzz surrounding the premise of a connected world where the refrigerator knows you’re out of milk before you do, the reality is that the Internet of Things is going to generate a tremendous amount of data that few vendors and even fewer companies will know how to handle.

The challenge, analysts agreed at the Gartner Business Intelligence Summit, is that companies are trying to fit a whole new kind of data into a traditional data ecosystem. Databases have come a long way—many are now more agile than they’ve ever been. Unique environments such as Hadoop allow for the quick processing of very large and often unstructured data, while powerful in-memory solutions from legacy vendors including Oracle and SAS make real-time decision making a reality. There’s a growing need for these data processing capabilities, but there’s also a need for something more. 

Gartner analyst Dan Sommer pointed to an evolution occurring in the business intelligence market. Data is being created at such a rate that eventually traditional data processing tools will not be able to keep up without predictive and prescriptive capabilities. As predictive and prescriptive technology outpaces standard analytics, data science will become less reliant on business intelligence and lean more on algorithmic, or artificial, intelligence, according to Sommer. “We’re living in a world of data collection,” he said, “but the future calls for data connection. To connect data that’s being produced at this magnitude, we’re going to need technology and solutions that stay several steps ahead. That requires algorithms and machine learning.”

IBM Watson, the supercomputer that competed on Jeopardy!, has become a beacon of opportunity for data scientists experimenting with the link between Internet of Things–enabled devices and algorithmic intelligence. Using IBM’s app development platform, Bluemix, developers are now able to build cognitive Internet of Things apps that leverage Watson’s machine-learning capabilities. 

In a Web presentation, Swami Chandrasekaran, executive architect in the CTO office at IBM Watson Innovations, demonstrated how user modeling, just one of many Watson capabilities, enables brands to deliver an unprecedented kind of customer experience. Watson user modeling uses linguistic analytics to extract personality and social traits, as well as values and needs, from the way a person communicates. The tool also analyzes users’ digital footprints including email, text messages, tweets, forum posts, and other engagements, mapping “cognitive and social characteristics with their corresponding percentile values as the basis for analyzing personality and social traits,” Chandrasekaran explained.

The sample scenario that Chandrasekaran outlined involved a connected car and its driver, John, who happens to be a “very vocal person who maintains a strong digital presence.” After a long day at work, John shares tweets that contain strong emotions as he walks to his car; by the time he gets there, the connected car app has already done a psychographic analysis of his tweets using Watson user modeling. The analysis complete, John’s connected car makes music recommendations or auto-tunes to a station he’d enjoy given his particular set of emotions at that point, and can also control settings or make changes such as readjusting the seat, air-conditioning, and even maximum speed limit, Chandrasekaran said. 

In this scenario, the analytics reach beyond user preferences, past interactions or other behavioral data. By using complex algorithms that learn not only how a person acts but how he thinks, Watson pushes the boundaries of predictive and prescriptive analysis, arming marketers, sales teams, and customer service departments with data for the “next level” of personalized engagements, Chandrasekaran said. Insight gathered from this kind of IoT network “can be used anywhere to improve customer engagement for an organization trying to differentiate itself,” he added, and can fuel personality-driven engagements like marketing messages, special offers, social campaigns, and product recommendations. 

Development Platforms

Opportunities to operationalize data from IoT devices are so boundless that demand has given rise to a new breed of cloud solution—application-platform-as-a-service (APaaS). Gartner predicts that total APaaS revenue will grow from $1.8 billion in 2015 to nearly $2.9 billion in 2016 and will only increase as the Internet of Things continues to foster adoption of APaaS solutions. 

App development was once a task relegated to the IT department, but because the expanding number of connected devices has created new niche use cases for the growing magnitude of data, app building is becoming a responsibility that is shared across the enterprise. Vendors have responded aggressively, offering competitive platforms designed to make app development accessible to any user. 

IBM, for example, announced a $3 billion Internet of Things investment in March, allocating the funds toward bringing together the different pieces of its IoT ecosystem, including its APaaS offering, Bluemix. Bluemix gives users the tools required to build a variety of apps for the Myo armband, the Pebble smart watch, the Apple Watch, the Oculus Rift headset, and an evolving list of wearable and other IoT devices. 

“IBM sees the Internet of Things as a huge opportunity that’s poised for explosive growth,” Jay Henderson, strategy director at IBM ExperienceOne, says. Bluemix equips app developers—be they marketers or IT staff—with prebuilt connectors, automated components, and guidelines to provide additional support. APaaS solutions allow a faster, more nimble approach to building, deploying, and upgrading apps because they let you build apps by clicking and dragging instead of complicated coding. For marketers, the prospect of creating apps for the Internet of Things will significantly change their job roles. Because of marketers’ increasing need for technology, Gartner predicts that by 2017, the CMO will control more of the IT budget than the CIO. 

“When you look at what you can do with IoT, the opportunity for the marketing portfolio is exciting. The Internet of Things is providing two big interesting areas for marketing. It’s providing a way to better understand customers and a way to deliver engagements in a more relevant context,” Henderson explains. “The market for solutions is still emerging and is still largely experimental, but the Internet of Things is already redefining marketing in a way,” he adds. 

Most IoT devices will not be able to display banner ads, run commercials, or even support email, yet they’ll be key channels for marketing, according to Henderson. A connected air conditioner, for example, will be able to self-diagnose a problem—like recognize that it’s time to replace a filter—and trigger an alert on a consumer’s smartphone app. The app will then generate a coupon or a special offer for that specific filter and voilà—a new marketing opportunity has emerged. Building that app and equipping it with various marketing functions will require the flexibility of an APaaS solution such as Bluemix, but IBM is not the only vendor to zero in on this need; big names in the CRM market now offer APaaS as well. 

Salesforce.com, for example, has the Salesforce1 platform—a dual solution that leverages cloud platform Heroku for customer-facing applications and cloud platform Force.com for employee-facing apps. Heroku lets companies create customer-facing apps without the complexity of architecting them for the Web; the app building process is visual and guided. Vendors have worked to make these platforms user-friendly, and analysts have likened modern-day APaaS offerings such as Bluemix and Salesforce1 to Lego sets that make becoming a master app builder more attainable to any user. 

The setup is similar on Force.com, the employee-facing side of Salesforce1, except that users also have access to the AppExchange, where they can use existing app infrastructure to build tools for sales representatives, marketers, and customer service teams. 

“There’s been a lot of excitement surrounding consumer adoption of wearable and IoT devices, but the reality is that they’re being adopted in the enterprise as well, and there’s a lot of potential there,” says Dan Debow, senior vice president of emerging technologies at Salesforce.com. While most vendors have focused on consumer app-development platforms, Salesforce is one of a few companies to take aim at the enterprise as well. Wearable devices in particular have become popular in the workforce, and Salesforce has responded to the trend with Salesforce Wear, a developer pack of customizable applications for the enterprise.  

Salesforce Wear supports app development for more than a dozen different devices, including its most recent addition, the Apple Watch. The apps are open source and integrate fully with the Salesforce sales, marketing, and service clouds as well as other components of the Salesforce Customer Experience Platform to ensure that data is synced and consistent across channels and devices.  

Salesforce customers across different industries have begun using the wearable-compatible apps to augment sales, marketing, and service efforts. Customer service agents who do repairs or work in the field, for example, rely on apps built for wearable headsets to view equipment manuals or knowledge management databases without having to occupy their hands; sales reps are using sales productivity apps for smart watches to track meetings and appointments without having to check their phones. “This is just the beginning. The key here is that we’re giving users the freedom to design apps based on their unique business needs for their devices of choice. We’re just getting started,” Debow says. 

Despite rapid growth in the Internet of Things market, there’s still plenty of time for companies to get into the IoT game with consumer-facing experiences and employee-facing ones. The space is young, but the need to link devices, implement algorithm intelligence to harness data, and empower business users across the enterprise to develop apps is real and rising. Technology and software providers are working fast to build powerful IoT suites, but the burden of connecting the 3 Ds of the Internet of Things falls as much on the companies that use the solutions as it does on the vendors that provide them. “The true challenge,” Gartner’s Sommer says, “will be taking connected things and delivering connected experiences.”  

Associate Editor Maria Minsker can be reached at mminsker@infotoday.com.