How to transform my business model with internet of things (II)
In the first post I talked about the three most common types of project you can find in the IoT world. As a first example, and with the aim of breaking down some barriers of what is a common IoT project, I am going to explain a project where physical "things" are connected to the Internet that cannot have an embedded data generation and collection system, nor a communications system that allows data about that object to be uploaded to the Internet.
In this sense, here is a case of specific use, not the only one, of how to connect a product of our company to the Internet and how it can generate a change in the business model or how to impact otherwise on our users.
The case of the bottle of wine connected to the Internet
We are in a wine bottling customer that produces more than 12 million bottles a year. Today your production system is highly improved with very little waste in your production and a very high cycle time.
Within this production system, the customer identifies its different systems and robots that allow to fill, label, cap, put in boxes and palletize their wine bottles. First of all, the assets of the company where you earn or lose money are very well identified: the bottle glass, the components of the bottle at brand level (label, stopper, etc.), the wine bottle as the final product and, on the other hand, the production systems and robots.
Likewise, a winery or wine producer has a number of aspects inherent in its business model:
- The first of them is the heritage, that is to say, they are businesses created generations ago, traditional and familiar reason why to modernize the image of brand or the style of the bottle is not something simple.
- Second, like any industry that prides itself, operating margins are usually low if we talk about volume production as is the case here, so your differentiating strategy within the market is price and volume.
- Third, the traditional wine market is changing because customer habits are changing. The current user is more interested and specialized in the world of wine, claims other types of productions and seeks a type of wine that suits their tastes.
Therefore, the challenge is enormous: how to ensure that a static product that cannot be modified, generated in volume and sold in international markets can be differentiated in some way from signature wines, for example.
We come to the second thought: the bottle of wine is my differentiating asset and I have to gain competitiveness in the market with that differentiation respecting the original style of the brand and the bottle itself in its production line.
I also have to be able to know which numbered bottles go to each distributor or market and how my bottle is positioned in each of them to finally know what the consumer of my wine is like.
How IoT can transform the wine business
And this is where IoT comes in as the means to carry out that business transformation.
- The first step is to interconnect the business: but how? We introduce into the production line new systems or devices that allow, quickly and easily, identify the unique number of each bottle within the label (OCR cameras, machine vision cameras, removable RFID plugs, etc.). With this, we will be able, at system level, to create an algorithm that registers the bottles that enter in the robot that introduces, at once, the 6 bottles in the box and immediately after, to register the number of each bottle on a label in the box (for example, with inkjet printers).
- Once we have the binomial box-bottle number we can integrate the following production systems: box labeler, pallet labeler, order, delivery note, etc. and with this, we achieve something really important today for any business that wants to differentiate itself: to be able to trace the product once it leaves your factory and thus know its consumers.
We already have the box of 6 bottles of wine ready to travel, for example, to China. And every bottle has its number registered in our system. Now, how do we connect the bottle, the "thing", to the Internet? Very simple, creating an app that reads the bottle number. Simply with that step opens up a world of options for our product and our customer, as we will be able to connect with our consumer.
This simple way will allow us to know who and where they buy our product, know their migratory flows, segment our type of customer, etc. and thanks to this, we will be able to open new markets, make our marketing campaigns more effective, expand more information about our winery, their land, grapes, etc..
In other words, we have connected each bottle of wine to the Internet in a direct way, without social networks in between, without touching the bottle and connecting directly with our user.
This example, like so many others, shows that to make a IoT project and generate thousands of data for analysis to help us improve our business is not necessary to sensor. Getting there is as simple as knowing the number of each product and integrating it into a mobile app. In the next posts we will continue to see cases of use of how to connect things to the Internet and transform our business.