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- In time, the idea of a smartphone as a commerce device could be old news as commerce extends beyond simply portable consumer devices and into the emerging “internet of things” (IoT) ecosystem.
- As the gap between the current offerings in the “internet of things” ecosystem and the potential for life-altering use cases begins to narrow, there are ample opportunities for forward-thinking brands that show a willingness to try and fail in this still-developing space.
Increased digital connectivity has underpinned generational shifts in how consumers conduct commerce. As consumers, devices and now things become more and more connected, the possibilities in terms of what could be leveraged as a vehicle for enabling commerce have become endless. In time, the idea of a smartphone as a commerce device could be old news as commerce extends beyond simply portable consumer devices and into the emerging “internet of things” (IoT) ecosystem.
Below are three American brands keen to be at the forefront of the movement to layer commerce across the IoT ecosystem:
(1) MasterCard: Every device as a commerce device
From the ring on a consumer’s finger to the refrigerator in the kitchen to the car in the garage, players across the burgeoning ecosystem are exploring ways to embed what once seemed like futuristic commerce applications into everyday items. Integrating commerce into all these newly connected things is not a simple task, but one that MasterCard Inc. has been exploring.
MasterCard has been quite active when it comes to partnering with a number of consumer-facing brands in this space. In late 2015, the second-largest U.S. payment network introduced a program that could turn any consumer gadget, accessory or wearable into a payment device. On the back of this development, it teamed up with automaker General Motors, wearable technology inventor Nymi, smart jewellery company Ringly and consumer appliances and electronics manufacturer Samsung to explore the integration of payments within their portfolio of products.
In 2016, for example, MasterCard unveiled an app enabling a consumer to shop for food from a LCD touch screen on Samsung’s new Family Hub Refrigerator. Consumers can use the touch screen to update calendars, leave notes and order groceries through partners, including FreshDirect and ShopRite, with a 2017 update now enabling all this to be executed with voice. Notwithstanding long replacement cycles, this could become the way consumers shop for groceries in 10 to 15 years. In late 2016, MasterCard also announced a partnership with Fit Pay Inc., which will integrate MasterCard’s contactless payments technology within the Fit Pay platform in order to more efficiently and effectively deploy commerce across wearables.
(2) IBM: Watson emerges as the brain behind next-gen commerce
Artificial intelligence like that provided through IBM’s Watson enables brands to swiftly comb through data to recognize patterns and connect the dots that ultimately enhance the one-to-one interaction with consumers. IBM’s artificial intelligence engine has been the source of continuous commerce innovation over the last year including a number of initiatives with key brands.
In one example, IBM partnered with General Motors to integrate Watson into the car maker’s internet-connected OnStar infotainment service. This integration will enable OnStar to make dining recommendations, send reminders tailored to individual drivers and conduct commerce. With the customer's consent, Watson will learn the driver's preferences by sifting through data to recognize patterns in their decisions. For example, the service could help drivers locate the nearest ExxonMobil gas station, recommend the best fuel and then enable in-car payment. These new capabilities will be available in two million 4G LTE connected vehicles and millions of GM brand app-enabled mobile devices in the U.S. in 2017.
In one of its biggest partnerships to date, IBM teamed up late last week with the largest U.S. payment network, Visa Inc. Up until now, Visa only has made a handful of isolated moves as its U.S. rival MasterCard sought out more partnerships in the emerging space. This latest partnership will marry IBM’s Watson IoT platform with Visa’s global payments services, which are used by more than three billion consumers globally. IBM’s Watson IoT Platform allows businesses to connect to billions of connected devices, sensors and systems around the world to draw actionable insights and now will enable businesses to tap into Visa’s network to quickly introduce secure payment experiences.
(3) Amazon: Alexa becomes the most prominent commerce voice
The world’s largest online retailer offers tools, such as Amazon Dash and Amazon Echo, that are enabling consumers to conduct commerce in new ways. Amazon Dash, which was introduced in March 2015 in what many initially thought might have been an April Fools’ Day joke, has cemented itself as the low-tech precursor to IoT-enabled commerce. The second installment of Amazon Dash led to the introduction of the Amazon Dash Replenishment Service, which is a platform that manufacturers can incorporate into their own products. Manufacturers can either build a physical button into their hardware for shoppers to use when re-ordering products or the technology itself can measure consumable usage and enable re-ordering to take place automatically.
Amazon Echo, powered by its virtual assistant Alexa, is one of Amazon’s most promising ventures. By being deeply integrated into the daily activities of its users, Alexa can become an integral part of the shopper’s path to purchase. Consumers can discover local events for the upcoming weekend through Stubhub or order a ride through Uber or Lyft. Hungry? Domino’s enables customers to order pizza and track the order status through Alexa. Amazon has embraced open-source development, leading major consumer brands, such as LG Electronics Co Ltd, Whirlpool Corp and Ford Motor Co, to integrate Alexa into their products to allow consumers to control these devices via voice. Of course, there is usually a commerce component. For example, Ford drivers will be able to vocally place orders on Amazon while navigating traffic.
The “internet of things” has the potential to alter commerce in a variety of ways, including creating new touchpoints between brands and consumers, as well as the possibility to leverage even more granular data upon which to build better brand experiences. As the gap between the current offerings in the “internet of things” ecosystem and the potential for life-altering use cases begins to narrow, there are ample opportunities for forward-thinking brands that show a willingness to try and fail in this still-developing space.
