How internet of things data is driving product innovation?

Do you listen to music in the bathroom? You’re not the only one. High-end audio and video equipment brand Denon & Marantz, owned by Sound United, found out almost by accident that a significant portion of its wireless-speaker customers liked to be serenaded in the loo. It led to the company developing a very successful line of waterproof and humidity-protected speakers.

While many businesses employ IoT (Internet of Things) technology to improve customer service through remote monitoring and diagnostics, the devices and the data they generate are gaining traction in product development. Denon and other consumer electronics companies are using IoT to collect data on how their products are being used, then parsing that data to inform their development efforts, whether to enhance existing items or innovate new ones. It points to a not-so-distant future where product development will be a continuous and interactive process that hinges on data analysis rather than intuition and corporate culture.

Denon collects device data to aid its service efforts – proactively pushing out product fixes, for example. As a step in initializing its new HEOS wireless speakers, the company gave customers an option to name their devices. When the data indicated that a significant number of customers were naming them « bathroom speaker », Denon prioritized bathroom-proofing the product, even though it had a roadmap of upgrades already planned. The company marketed the enhancements as a prominent feature in a line of customized speakers.

Social context

Denon leverages its IoT-generated data in another way: By combining it with product feedback found on social media. The additional depth and context help company engineers and service technicians identify opportunities and prioritize problems.

A few years ago, social-media monitoring was a customer service and support function, driven by the need to respond quickly to users’ criticisms and complaints. Over time, savvy companies realized that there were nuggets of valuable product information buried among the attacks and conspiracy theories.

By marrying the continuous usage data provided by IoT sensors with the commentary data teased out of social networks, a company can build a more complete picture of how its product or service actually functions out in the real world. It’s a far more efficient and effective means of prioritizing product development than customer surveys.

Though social media data is « noisier » than product usage data, together they represent a cascade of unfiltered information. This is where data analytics powered by machine learning and artificial intelligence comes into play. The right tools can churn through clusters of structured and unstructured data, separating the signifiers from the outliers and pointing to important trends and away from blind alleys. Continuous product innovation doesn’t necessarily demand real-time responsiveness – not yet, at any rate.

The cutting edge

This product-innovation feedback loop is most noticeable in the consumer electronics industry, where manufacturers are heavily invested in customer connectivity and fast market response.

Since 2012 electronics maker Belkin has produced a line of « Smart Home » products – plugs, switches and appliances – that lets users control fixtures and utilities. The networked IoT devices, called « WeMo », are accessed via a smartphone app and can be operated in a variety of ways, such as by voice control through an interactive speaker.

As the products got popular, Belkin personnel were overwhelmed with the volume of feedback the devices generated, as both IoT usage data and social media commentary. Belkin enlisted help from DataScience (recently acquired by Oracle) to build a model that Belkin engineers can use to sift through WeMo text data daily for common words and phrases that represent the most positive and negative feedback. The negatives help Belkin personnel prioritize product fixes, and the positives point the way to new features, even new products. The process has garnered WeMo devices higher customer satisfaction ratings.

What the Denon and Belkin examples illustrate is that the conventional product roadmap is taking a back seat to ongoing product innovation, made possible by the real-world usage data that IoT devices can provide. Let’s face it: When you’re presented with hard evidence of exactly how – and where – your customers want to use your product, your priorities become obvious.