Staying updated with the market trends and a detailed competitive benchmarking study can help industrial manufacturers grow by leaps and bounds. The progress made by a US industrial manufacturer using competitive benchmarking for IoT services holds lessons for industrial players of all stripes.
Industrial companies were already amidst disruptions and economic pressure during early 2020 from ongoing trade disputes, repercussions of Brexit, automotive industry challenges, and the demand slowdown in China. The COVID-19 outbreak has put global economies and businesses into a much more profound and unprecedented crisis. Consequently, there have been shocks to both supply and demand across markets. The critical leadership focus at the moment is mostly on minimizing the employee toll of the COVID-19 through safety measures for workers, and the new physical-distancing standards are dramatically altering operations, employee responsibilities, and staffing. This reinforces the need for IoT services to help companies proceed on the journey to the ‘new normal.’ IoT solutions, when implemented in a plug-and-play mode, can be instrumental in ensuring business continuity and minimizing economic damage while anchoring employee safety, improving liquidity, and reducing short-term costs.
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Competitive benchmarking of IoT services for an industrial manufacturer
Engagement Scope
In a span of 16 weeks, the client, an industrial manufacturing company in the United States successfully actioned their plan to venture into the IoT service market by launching their cloud-based Internet of Things (IoT) platform.
Engagement duration: 16 weeks | Region of focus: North America | Segment: IoT services
An industrial manufacturer based out of Ohio, USA, wanted to venture into the IoT services market with an aim to provide end-users with increased visibility into their operations, optimize production, reduce costs, and increase customer satisfaction. To succeed in this new initiative, the client wanted to identify and evaluate suppliers offering IoT services for commercial and institutional end-users in segments including laundry, kitchen, and facility cleaning dispensers. Through the engagement, experts at Infiniti were also tasked with assessing pricing models, product offerings, market dynamics for the adoption of IoT services, and growth of smart commercial/facility segment. This data would facilitate the client to evaluate competitor offerings, pricing models, market challenges, and market dynamics across different segments.
Our approach
Experts at Infiniti used a sequential approach to obtain accurate and actionable market insights. This involved:
- Phase 1 – Planning, Initiating, and Source Identification: The key objectives of the engagement were determined along with the schedule finalization for the project, including the overall engagement scope and duration. The next step involved identifying and establishing the key sources of data collection.
- Phase 2 – Data Aggregation: Experts at Infiniti Research used an incisive approach consisting of primary and secondary research for data collection.In the primary research phase, our industry experts conducted 29 in-depth primary interviews with market experts, business executives, and end-users of IoT services in laundry, kitchen, and facility cleaning segments.Secondary research involved data collection from sources, including public and private databases, industry news, articles, events, magazines, and competitor websites.
- Phase 3 – Data Analysis: The next phase involved a thorough validation and data cleansing process to filter out the required information from the extensive data set collected. Post this, an in-depth data analysis was undertaken using a variety of techniques including top-down/bottom-up market analysis, pricing and structuring analysis, detailed competitor benchmarking, and market segmentation analysis.
- Reporting in Structured Templates: A detailed report was presented to the client based on the refinement and transformation of data in structured templates to make the data actionable.
Key findings & recommendations
Based on the comprehensive competitor benchmarking analysis, pricing analysis, and market segmentation analysis undertaken on the IoT services market for the client, the following were the key market findings and recommendations presented to the client:
- Subscription-based pricing model and area-based pricing models are the two key pricing approaches adopted by top companies providing IoT services in the US. A subscription pricing model can be designed on a monthly or yearly basis depending upon factors such as the number of connected devices, type of users, customized solutions, and client requirements. On the other hand, an area-based pricing model is based on factors such as the type and area of the building (in sq. ft.). Suppliers offer subscription plans and one-time payment options depending on the clients’ requirements.
- Real-time dashboards, remote configuration, real-time alerts, and asset management are some of the key IoT service features offered by the client’s key competitors in the market.
- Top market competitors of the client offerings IoT services have structured their service offerings into three main formats. A bundling structure that comes with a wide range of plans (combining many features into a single plan), an individual IoT solution that includes a fixed package with pre-loaded features, and a customized structure that allows customers to choose add-on features to the existing plan.
- Trends such as increasing demand for real-time monitoring of business operations and predictive maintenance planning are driving the demand for IoT services across entire laundry, kitchen, and facility cleaning segments.
- The demand for real-time monitoring of business processes across the laundry, kitchen, and facility cleaning segments is expected to be driven by factors such as the increasing need to improve efficiency and productivity, lower the cost of resources, and improve the life of dispensers.
- Factors such as improving uptime have become quite prevalent, hence, propelling the demand for IoT services. The increasing need to save time and resources is also expected to drive the adoption of IoT services.
- Several players in the IoT services market are also investing in smartphone-based applications to address market demands.
- The kitchen segment is experiencing an increasing demand for connected warewashing solutions and intelligent dishwashing, thereby propelling the demand for IoT-based services.
- Factors such as the rising demand for smart cleaning dispensers and automation are driving the demand for IoT services across the commercial laundry segment.
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Key recommendations & business impact
Our competitive benchmarking analysis and market assessment study helped the client gain an in-depth understanding of the IoT services market and evaluate various IoT services offered by key competitors and strategies used to promote them to the target customers. The pros and cons of each of the IoT services provided by market competitors were weighed during the competitor benchmarking analysis and the client selected the most viable and feasible features. The client decided to offer their IoT services in a bundle structure and have segregated them on the basis of Start, Pro, and Premium, each consisting of different features in each bundle.
Experts at Infiniti identified that smart cleaning dispensers have high demand in the laundry segment. In contrast, there are a high demand for connected warewashing solutions and robotic cleaning equipment in the kitchen and facility cleaning segments, respectively. This helped the client strategize and route their investment on the most profitable and in-demand segments. The client also decided to invest in predictive maintenance and planning as there is a growing demand for such IoT services among different end-user segments such as hotels, hospitals, and laundries. Within seven weeks, the client launched its cloud-based Internet of Things (IoT) platform, which was rolled out in the industrial laundry segment first with several critical benefits such as alarm reporting, better visibility into operations, and reduced costs. Based on the huge commercial success of this initiative, the client plans to expand their cloud-based IoT platform to other segments, such as facility cleaning.
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