What the influx of smart homes means for brand marketers

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2016 is slated to be a big year for connected devices. They’re designed to make life easier for consumers, but will they do the same for marketers?

For most consumers, the term “smart” probably brings to mind phones, fitbits and watches. But it goes so much further than wearables, as people will soon see.

The expo halls at Consumer Electronics Show (CES) in Las Vegas are full of smart products, particularly cars and devices for the home. This next phase of the Internet of Things (IoT) means convenience for users, but what does an increasingly connected home mean for brands?

“A more connected IoT means more data spinning off those connections, which leads to better marketing,” says Chad Gallagher, director of mobile for AOL’s Advertising.com. “If your car is connected and you know how many miles per week you drive, that can be a really valuable data set for an automaker.”

Taking it inside, consumer packaged goods (CPG) brands would be equally interested in what consumers do in the kitchen. Knowing how often you cook soup is certainly valuable data for Campbell’s, which can use that information to create better user experiences (UX) and more relevant ads.

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Gallagher points out that consumers will probably appreciate this, as long as the brands are transparent.

“Everything being more connected leads to better data we can funnel into the ad tech system, but privacy needs to be front and center, giving us the option to say how we want our data to be exposed,” he says.

These issues will likely come up sooner rather than later. Earlier this week, real estate franchise Coldwell Banker released the results of its Smart Home Marketplace Survey.

Polling more than 4,000 Americans, Coldwell Banker found that 45 percent of people either own smart home technology, or plan to invest in it this year. Of those who don’t use smart technology, 27 percent plan to incorporate it into their lives this year. And 70 percent of people said buying their first smart home product made them more likely to buy more.

According to Gallagher, IoT is one of the top priorities for Verizon, which acquired AOL back in June, in 2016. He compares connected devices to mobile devices five years ago; there’s much more conversation than scale, but that’s going to change soon.

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Most of Coldwell Banker’s respondents said that the first smart home accruements that typically come to mind include security, temperature and lighting. However, entertainment is typically the “gateway drug,” since many people’s first smart electronic is a TV or speaker system.

“[Consumers] think of smart as something they know to do one thing that all of a sudden, has new and advanced capabilities that go beyond the core function of the device,” says Jim Gustke, vice president of marketing for Ooma.

Ooma was at CES showcasing its software, which aims to return the home phone to relevance again by making it the “communication hub for the connected home.” Like Gallagher, Gustke believes the smart home will be key for marketers from a data perspective.

And like virtual reality, there’s also an inherent increase in engagement. Incorporating smart home devices into their marketing strategies allows brands to reach consumers where they live, literally, and become integrated in their daily routines. What’s more personal than someone’s home? Smartphones are a distant second, and Gustke believes it’s only a matter of time before someone connects the two in a real way.

“Who wants a separate app for the lights, for the garage door, for the coffee machine? Who wants to deal with all that? Someone is going to come and put it all together, as one way to interact with your home,” he says.

That gives brands yet another opportunity: marketing within that app. It may not exist, but given how quickly people are making their homes smart, you can be sure that it will.

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