HowIoT is Changing Advertising: Benefits and Top Use Cases

Today, the Internet of Things is one of the most promising technologies creating a global revolution. IoT is already doing so in various industries, not all of them obvious. Let’s take a closer look at one such sphere where IoT-powered solutions are being applied: IoT in advertising. How are these solutions applied in this industry? And what impact do they have on modern marketing and advertising tactics? In this blog post, we’ll offer some answers to these questions.

First, let’s explain what the concept of smart IoT advertising involves, and what makes it different from traditional tactics in advertising.

As you may already know, IoT tech allows us to unite distinct real-world objects into one network. Such networks can include various smart devices powered with sensors that are intended for gathering data in real time. Thanks to these capacities, IoT devices can collect a lot of valuable marketing information required for personalized advertisements, which are expected to bring the customer experience to a completely new level.

What information is required in marketing for generating personalized messages for consumers? This is usually info on customer behavior, people’s interests, preferences, buying patterns, history of search, etc. And that’s exactly what IoT devices can collect and accumulate to help develop an effective marketing strategy.

As already mentioned, the key role of the Internet of Things in advertising is the ability of smart devices to gather real-time data that can help make ads more effective and, consequently, allows those in marketing to use their advertising resources more effectively.

Let’s consider precise use cases in more detail. 

• In-store advertising

When we refer to in-store advertising in the context of smart technologies, we don’t mean banners or leaflets that users can see in supermarkets, but rather ads displayed on their smartphones based on real-time data. This is possible thanks to small transmitters, dubbed beacons, that can send signals to devices located nearby via a Bluetooth connection. 

Beacons can detect which products look interesting to buyers and which of them a person is likely to purchase. Based on this information, an IoT app can show similar or related products. This can significantly boost sales and revenue.

• Interactive advertising

Thanks to IoT in advertising, it is possible to organize communication between brands and consumers in the form of a dialogue rather than the usual one-way advertising. Interactive ads are aimed at encouraging people to take steps and perform actions to get tangible results, for example to receive more info about products or participate in a lottery organized by a brand.

Interactive advertising assumes that buyers will take the initiative, not that this requires serious effort. A good example of such interaction is scanning a QR code or making and sending a real-time photo. These solutions are expected to drastically improve the effectiveness of marketing campaigns, as customer engagement always has a positive impact on purchase decisions.

• Location-based advertising

Using GPS technology in combination with IoT in advertising can enhance the effectiveness of all marketing efforts. Such solutions can be used to track the location of objects and people. Based on this information, brands can deliver highly personalized advertisements.

For example, when an IoT app detects that a person is near a supermarket, it can show a user a list of current promotions. The same approach can be used by restaurants to send the day’s menu to users who are somewhere near their location.

• Contextual segmentation

Thanks to the growing number of people who have IoT-enabled devices, these can be used to gather and process valuable data about customer behavior and habits. This data helps advertisers deliver targeted, contextual messages to each user. A good example is Google Search Ads. When people are looking for certain products or services, Google Ads will start showing them relevant offers based on their needs and location.

• Intent- advertising

Intent marketing can be described as a marketing approach that includes promoting a product or service based on people’s intent to buy it. In other words, in intent marketing, it is important to analyze consumer behavior and try to influence those people who already demonstrate some signs of readiness to make a purchase.

For intent-based advertising, it is necessary to segment consumers in accordance with their interest in a brand. IoT devices can collect the required information, such as time spent by users near some products in supermarkets, or categories of goods that attract their attention in a shopping app. All this information can be further used by brands to develop their advertising strategies, offer more helpful ads and fully revolutionize the consumer experience.

In general, we can say that some applications and tools powered by IoT technologies in advertising are quite similar to software products used in the retail industry. Both groups of solutions are aimed at boosting sales and, consequently, increasing profits.

As you can see, IoT in the advertising industry is headed in a promising direction, given the impact of such apps on the effectiveness of promotion campaigns. The benefits of apps powered by the Internet of Things, in general, are quite tangible, which explains the growing demand for IoT development services among various companies and organizations.

IoT devices can help brands deliver better-targeted ad messages to consumers, which makes all these efforts more feasible and optimizes a company’s marketing expenses to achieve growing revenue.

If you are interested in launching such a solution for the needs of your business, at Cogniteq, we are always ready to help you. Just contact us!