There has been an increasing amount of noise about the Internet of Things over the last few years, and we’ve been told it’ll do everything from control the heat and light in our homes, order us food when we’re out, even control our cars. But it’s early days yet, and for many it has felt like a repeat of marketers once again over promising and underdelivering.
Early adopters will try anything if its new, but it’s the response of the later, more mainstream audience that will decide when (or even if) the new services providable by the Internet of Things will become mainstream and profitable. But that inflexion point may be nearer than we thought, and its Amazon Dash that is showing the way.
What Amazon is doing with Dash is not cheap, but it is clever because its all about convenience. And the early adopters can help build the cost/benefit model, as a consumer rollout will need to see big changes to the price.
The Dash Button, only available to members of Prime, enables shoppers to reorder favourite items at the push of a button. Each button is linked to a brand – and placed in a convenient location so that shoppers can order every time they run out of that brand. Thus an Andrex button might be beside the toilet roll holder, or an Ariel button on the washing machine. Each costs £4.99, with the price discounted from the first order.
Shoppers link the button to their wi-fi and then control ordering through an Amazon app. Orders are confirmed via email so can be cancelled if made in error. Meanwhile, a second order will never be placed until the first has arrived.
Research by digital agency Salmon, released a day after the launch of the Dash Button, suggests that 13 per cent of UK shoppers believe that they are ready now for what the agency has dubbed ‘programmatic commerce,’ in which connected devices such as a smart fridge or coffee machine might reorder products from milk to fresh coffee when supplies run low.
More than half (57 per cent) of the 2,000 UK consumers questioned said they’d be ready now, and 58 per cent said they’d be more likely to buy into smart technology if it would enable this kind of shopping, while 35 per cent said they already had such a device in their homes, or planned to buy one in the coming year.
Some concerns were raised. More than half of consumers (54%) named their lack of control over purchases, while 51% cited security and 51% privacy of their personal data. But they also see advantages – 37% said it would save time, 25% said it would be convenient and 37% said they’d save money if such a system automatically selected the cheapest products.
Six in ten say they wouldn’t pay any kind of fee for the service, but 41% would pay more for a smart device that enabled it.
The button adds to the Amazon Dash scanning and voice ordering device launched in the UK earlier this summer, which allows enables shoppers to scan a product’s barcode or speak its name into the device in order to add it to their basket.
And the technology also moves forward with the Amazon Dash replenishment service, unveiled this week, which enables connected devices to automatically reorder items when needed. Thus a connected washing machine might reorder detergent, or a printer might reorder ink. Brands working on integrating this replenishment service include Bosch, Siemens, Whirlpool and Samsung.
The Dash Button has been available in the US since last year. There, says Taryn Mitchell, global VP digital sales, they account for “significant number of the orders we see through Amazon today.” He added: “It’s a remarkably convenient way for customers to reorder everyday items and even adds a bit of fun to the process.”
In the last two months, says Amazon, Dash button orders have increased threefold, and orders are placed at a rate of more than two a minute. Four times as many Dash Button brands are available this year, compared to last year.
Ecommerce delivery specialist ParcelHero has suggested that the launch of Amazon’s ‘Internet of Things’ Dash service could take as much as 20 per cent of UK supermarket online sales.
David Jinks, head of consumer research, said, “Dash is an ultra-convenient device. With the simple push of a button – or even by speaking to the gizmo for some versions – it will reorder your washing powder or your coffee or one of 40 products at launch. It’s great news for busy people as it takes care of routine shopping chores automatically; but it’s very bad news for supermarkets as it ties consumers into Amazon for even more products.”
Even if the button by the loo roll holder may be too much of a temptation to sticky little fingers, if the system prevents re-ordering it might work. Where it really looks interesting is in automatic reminders. That actually solves a problem for busy consumers, and solving a problem is what leads to a sale.
It looks like Amazon may have made an IoT breakthrough after all.
