The Internet of Things (IoT) is, via Wikipedia, a "network of physical objects ... embedded with electronics, software, sensors and connectivity to enable it to achieve greater value and service by exchanging data." Or, more simply, it's when a plethora of different, everyday stuff is equipped with sensors that communicate with each other and relay information. The most famous example of a smart object that can included in the Internet of Things is probably the Nest thermostat, which can receive weather information from the internet and send out back about how it is used.
The IoT isn't just limited to inanimate objects. Sensors can be applied to farm animals to monitor their location and health, and to people to do the same. And here we run into the problem many people have with the IoT. When everything is able to give it's location, movement, how it is being used, etc., it raises a large number of concerns about both the security risk of that information and concomitant privacy issues.
While a great many of us are carrying around an object that not only gives away our position but also contains most of our communications, we can change its settings and turns those abilities off. But what do we do about the sensors in our car? Our watch? Our bottle of booze?
Will we have to pass laws requiring things we purchase to be labeled as web-connectable? Will we have the option of turning the sensors off if we're buying something we find embarrassing? Who gets that information? Who gets to use it? The world is changing, whether we like it or not, so it's important we know what we're getting into.
According to an article by Kate Kaye in Advertising Age, objects can only personally identify a consumer through an opt-in option, but the industry is still deciding on best practices, and there aren't any government regulations over the IoT, as of yet.
But there are upsides to this as well. Nicole Kobie of the Guardian notes that companies may give consumers certain products for free, in exchange for the ability to use information gathered from products to target the consumer with ads. Embedded sensors could allow shoppers to quickly determine if a product is the genuine article or a knock-off, or let a repairperson know exactly where a problem in a car or washing machine is.
For the advertising industry, the Internet of Things could be an absolute bonanza in terms of marketing data. As Kaye observes, more and more corporations are testing and implementing web-connected products. And that data will be infinitely useful for the purpose of demographic research and consumer targeting.
Kaye notes that currently "IoT platform company Evrythng sees a home for data generated by connected thermostats, bottles of booze, designer handbags and washing machines in first-party marketing databases." Those first-party marketers would be able to target digital ads back at the consumer while knowing exactly what their shopping habits are. And this targeting could reach down to an individual level.
Whatever happens, the full implementation of the Internet of Things is perhaps already bigger than many realize. And more is coming, so we should all be ready for it. Marketers certainly will be.