How Inventors and Ad Agencies Are Starting to Shape the Internet of Things' Next Phase

What can a hot tub that makes its own shopping list tell us about the future of the internet? To better understand how connected devices benefit from giving and receiving data, James Whittaker, a Microsoft tech evangelist, connected his heated mini-pool to the internet so it could take in data from his local spa company, find sources of chemicals it needs to buy, follow sales patterns, know its internal supply and how fast it's using them, monitor the weather, etc. Along the way, he realized his hot tub might be better off buying supplies for itself than he is. Whittaker represents a budding legion of Internet of Things tinkerers who will descend on the Consumer Electronics Show this week in Las Vegas with grand designs. "Imagine once the entire world of hot tubs has been reduced to data," he says. "How do you advertise to my hot tub? … If you come to my hot tub and say, 'You should try this other chemical because it's better for the following reasons,' my hot tub is going to say, 'No man, it's not. Sorry, but I've got the data.'" The digital world's rapid interweaving with the physical world is forcing tech companies and ad agencies to constantly bone up on the massive landscape of big data. In fact, some analysts and experts expect there will be as many as 50 billion connected devices within three years, which International Data Corp. estimates could generate nearly $9 trillion in sales by 2020. At CES, a number of companies will debut IoT products that range from brilliant to wacky. Thinfilm Electronics, a Norwegian near-field-communication company, will be displaying its line of smart bottles that connect smartphones to social media and other websites. Manufacturing giant 3M will debut a way to track breathing patterns and one's environment through wearable devices in ways that could help people with asthma or allergies. Yet another company, Ozobot, will be showcasing its mini "social robots" that are operated through color command to help kids learn to code. And of course, there will be plenty of shiny new examples of connected cars, connected shoes and connected travel. "We all have that photo where we made unfortunate hair decisions or wardrobe decisions, and you're seeing IoT go through that now," explains Brian David Johnson, a former futurist at Intel and current futurist in residence at Arizona State University's Center for Science. All awkwardness aside, Johnson contends that the Internet of Things is finally entering an age of adolescence. While much of the original consumer-grade hype has focused on turning lights on and off and tracking fitness, the next few years will see an inventive wave of maturity—and advertisers seem keen to play a part. In February, ad agency R/GA will launch its IoT Venture Studio UK, a joint partnership with the British government to work with startups through a new accelerator program in its London office. The initiative selects companies across various IoT verticals and provides them access to branding, technology, funding and clients. In return, R/GA gets a glimpse at innovations in the space to possibly integrate into clients' efforts. Nick Coronges, global chief technology officer at R/GA, says the agency sees the program as a portfolio that lets it "place some bets" across the IoT spectrum. While the companies have not yet been announced, they're expected to focus on financial services, retailers and connected homes and workplaces. "It's a little bit like electricity, where it's not so much about IoT but the different applications of it," Coronges says. "Now we don't talk about electricity, but the products that come from it. We won't talk about IoT; we'll talk about the things people are building on top of it." Other agencies are also experimenting. Next week, Huge will install a retro vending machine that it bought on eBay for $150 into its Atlanta coffee shop. But there's a twist: Instead of taking payment in the form of old-school coin, the web-connected machine will accept "social currency," letting anyone pay for a pin with a tweet or a Facebook post. Derek Fridman, group creative director at Huge Atlanta, says the tech-based trial could someday inform retailers or restaurants that want to employ similar machines to let people pick up items after hours via connected lockers. "It's not about creating new stuff, but making old stuff cool again or old stuff relevant again," Fridman says. Metrics—lots and lots of metrics—are at the center of all of this product development. According to Cisco, connected devices will create 600 zettabytes of data per year by 2020, up from 145 zettabytes in 2015. (For reference, 1 zettabyte equals 1 trillion gigabytes.) Such figures require companies like Dell, Microsoft, Intel and IBM to make sense of it all for both brands and consumers. By using machine learning and artificial intelligence, these companies are testing how to turn boring numbers into interesting things. "It is impossible for us to look at data, consume data and make sense of data—connect the dots across the different types of interactions—in a way that can scale," explains Kevin Lindsay, director of product marketing at Adobe. "Being able to take in all that data and make insights from it is impossible without machine learnings." Per Bridget Karlin, managing director of IoT strategy at Intel and executive board member of the Consumer Technology Association (which operates CES), a key theme for this year's event will be how to integrate and ingest unstructured data. For example, if there's a new fashion trend popping up on Instagram, brands will be able to stock up on those items in an automated manner, thanks to connectivity. Karlin points out there are telling signs of IoT's explosive growth—Gartner recently prognosticated that $2.5 million is currently spent on connected hardware every minute. "While there's always been a very high desire to have a conversation between consumers and retailers, now with IoT, that's more possible than ever," says Karlin. Which is why hot tubs, vending machines and mini-robots just scratch the surface of the potential impact of IoT on human life. Whittaker suggests we might someday even have devices that help us know the best times to go to the bathroom during a movie based on what we've had to drink and where the toilets are. "I've always said AI shouldn't stand for artificial intelligence," he remarks. "I think it should stand for 'algorithmically impressive.'" This story first appeared in the January 2, 2017 issue of Adweek magazine. Click here to subscribe.

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How Inventors and Ad Agencies Are Starting to Shape the Internet of Things' Next Phase

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Marty Swant

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Marty Swant