Originally appeared on Digital River
In my last post, I introduced the concept of the Commerce of Things—the way that connected objects will make transactions on our behalf. But why should people allow objects to do business for us, with our permission and on our behalf? We think there are some excellent reasons why we’ll want to do exactly that.
The Commerce of Things Can Save us Time
Just think of your morning cup of coffee. Every time you need coffee, you have to do something—order a pound of beans online, pick some up at the store, or maybe look for a coupon. The time you spend buying coffee beans seems inconsequential until you start adding up all the little errands that quietly eat up your life—getting kibble for the dog, washer fluid for the car, restocking the toothpaste. Once objects are smart enough to enable commercial transactions on their own, all these tiny to-dos will simply take care of themselves—freeing us to spend more time doing more meaningful things.
The Commerce of Things Will Anticipate our Needs
Dentists tell us that we should change our toothbrushes every three or four months—or more, if we brush harder or more often than most people. Right now, connected toothbrushes can report on how much and how hard we brush, gamifying the experience of brushing. But we still need to go and order replacement heads every time we need them. Because of that extra step, many of us go too long with a worn-out brush. If a new brush simply arrived in the mail every time you needed one for optimal oral hygiene, your dentist would be happier and you’d be healthier. What if your refrigerator could quietly order your favorite kind of frozen broccoli when you weren’t eating enough green vegetables? What if your running shoes could replace themselves at exactly the moment when they no longer offered the correct support? Think of the possibilities.
The Commerce of Things Will Lead to Smarter Purchases
Behavioral economists are learning what marketers have always known: many of our purchasing decisions are, frankly, unwise. We make impulse purchases in the checkout line; we succumb to the allure of the overpriced luxury item merely for the label; and we put off necessary purchases for too long because we’re preoccupied with a thousand other more important things. Connected devices will take advantage of the power of big data analytics to reduce the impact of human frailty in consumer decisions, saving us money and improving our lives. If I know my running shoes will replace themselves at exactly the right time with exactly the right model for my feet, I won’t be tempted to splurge on an overpriced new pair that I don’t really need. If your smart smoke detector can tactfully send a replacement battery in the mail at exactly the right time, it can make your home safer.
When we shift our buying preferences, manufacturers can be uncertain about how that shift will impact their business. The good news for manufacturers – when we are purchasing items like toothbrushes and running shoes based on manufacturer recommendations, we will buy more frequently. And as these transactions become more automated, the lifetime value of every consumer increases significantly. Everyone wins – manufacturers get a more predictable consumer purchase pattern while we don’t have to think about mundane purchases. Leveraging the power of big data, object-enabled transactions will allow smarter purchasing decisions than we’re likely to make on our own. The Commerce of Things will free us from the machine-like tasks of rote memory and trivial decision making that now take up far too much of our lives.
In my next post, I’ll talk about the consequences of the Commerce of Things for businesses. For now, what are your thoughts about objects that mediate transactions? What applications do you foresee for commerce-enabled things?