![]() ![]() It takes 23 months for the average smart connected IoT product to go from internal project kick-off to first paying customer. However, there is a wide variance in average of total time needed time needed from kick-off to first paying customers. The fastest implementations happen in 8 months while the longest may take up to 76 months (according to our analysis). Commercializing the IoT product (e.g., determining the right price level, measures to drive adoption, and KPIs to measure success).Developing the IoT business model (The analysis is largely based on the Zollenkop framework , which looks at three elements: Market positioning, value chain, and revenue model).Developing the IoT product (e.g.,time-to-market and developing the features).The IoT business model is tightly intertwined with the two adjacencies of product development and product commercialization. We, therefore, split our analysis into 3 parts: The report provides answers and viewpoints on each of these tradeoffs and highlights which IoT business models are considered to be more successful. This article does not go into the same depth as the report, but it highlights a few of the other insights that were uncovered during the analysis. Do I sell direct to the customer or via a third-party (marketplace)?.Do I price the solution at cost, with a margin, or perhaps deliberately at a loss to gain early market share?.Do I offer some features for free or not?.Do I charge once, on a monthly basis, or perhaps even per usage (pay per use)?.Do I monetize the hardware, the software, a service, or the data? Or perhaps a combination of those?.Do I approach existing customers first or target new ones?.There are many tradeoffs when bringing a smart connected product to market, for example: IoT Analytics’ 189-page report, titled “ IoT Commercialization & Business Model Adoption 2020” provides an in-depth look at how some of the leading equipment and product manufacturers (OEMs) around the world have successfully introduced smart connected IoT products in the last 5 years and which learnings they had on the way. ![]() Those who are currently bringing (or are planning to bring) smart connected products to market should ask themselves: What can we learn from these early innovators in order to create a truly successful IoT business model? Components of a successful IoT implementation There are thousands of o ther examples of new smart product / IoT business models and many more which are still in the making that we will hear of in the coming months and years.
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