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Here's Why Every Company Is A Service Provider In The Internet Of Things Era

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This article is more than 9 years old.

Imagine for a moment you run a company that makes TV sets or washing machines. Basically any sort of home product that plugs into the wall.

Your relationship with the customer used to be pretty straightforward, didn't it? You designed a product, manufactured it, marketed it, sold it in a store.

After the sale there would be some after sale support as you made good on your warranty - your's is that kinda company, after all - but for the most part, the relationship with the consumer post-sale was tenuous and mostly non-existent.

Sure, this is an ultra-simple description of your world, but it's also pretty accurate. At least until now.

That's because in the Internet of Things era, products that were once a mystery when they into the field are no longer so.

Now, instead, they are now smart and connected. Companies who make dish washers, TV sets and air conditioners are designing products that can communicate and tell someone in a call center what's wrong with them. Devices provide usage data that tells the manufacturer how consumers actually use their products over the years.

And like a computer, devices will be field upgradeable, enabling you to roll out new features as they become available, which will ensure higher consumer satisfaction.

All this means that over time the nature of the relationship between company and consumer changes, going from one that is largely transactional to one built around an on-going service relationship.

While this may seem like more work at first, the opposite is true. By maintaining ties with your customer and providing an ongoing service relationship over the life of a product, chances are you'll see benefits in lower overall support costs, higher customer retention, and better product understanding (which ultimately means better product creation).

All of which means you, imaginary CEO, can retire in the comfort of knowing you helped transition your company to the Internet of Things era.

Who knows, maybe they'll even name a conference room after you.

Michael Wolf is an Internet of Things and smart home analyst for NextMarket Insights. To stay up to date on this market, subscribe to his newsletter or follow him on Twitter.