The world today is marked by swift, fascinating and progressive changes. Speaking of the causes, most of these overhauls are driven by technological advancements. In fact, the technological framework of contemporary times is so surreal that it would have seemed unrealistic a few decades ago. Who would have imagined that driver-less cars or Hyper-loops would be for real. Similarly, ten years back no one could have imagined that Internet of things will emerge on the scene and transform the ways of the world forever! However, all this is for real and we are undergoing a colossal digital revolution.
The Internet of Things (IoT) is now penetrating every domain of human life. There is a massive buzz around IoT and its impact on the ways of the world. It is in fact, adding great convenience to human life and commercial activities that are salient to the world. From education to retail to production, IoT is streamlining processes and driving positive changes. The advantages of IoT are multidimensional and multifaceted. This blog lists some sectors that are gaining the most from the application of IoT or have the greatest scope for such gains. But before that, let us decipher the concept of IoT for once to be on the same page. There is no point in talking about the implementation of it without understanding the conceptualization, isn’t it?
What is Internet of things?
Let us try to understand IoT in terms of how IBM defines it. In simple terms, the Internet of Things is a network of devices connected to the internet and hence with each other through the internet. It can be understood as a humongous network of connected devices and people and hence it is termed the Internet of Things. Moreover, there are arrangements for data collection and sharing between the elements of this gigantic network. If you look around, you will find innumerable examples of applications of IoT even in the most basic things of daily use.
Smoke detectors, air quality sensors, your smartwatch, biometric scanners are some of the most common examples of IoT around you. Some more examples of IoT include smart home surveillance systems, lights with sensors, logistics tracking, and so on. IoT is the reason why you can track your Amazon package in real-time when it is on its way. Incredible and fascinating, isn’t it? It is interesting to note that as per PR Newswire, the global IoT market is projected to grow at a CAGR of 38.62% in the next few years. Imagine that for a value of CAGR! Incredible to say the least! Next, let us have a quick look at the working of IoT.
How does IoT do what it does?
The Internet of Things works on a system of sensors. Most devices and objects we use today have inbuilt sensors that are linked to an IoT platform. This platform further collects data from the connected devices and integrates it to further use analytics to filter out the most relevant and vital information. This relevant information is further utilized to cater to specific needs.
You would be amused to know how powerful an IoT platform is. With great efficiency, it can tell what information is imperative and which pieces of it can be discarded for being useless. Furthermore, this collected information can be further used to describe patterns, suggest recommendations or offer solutions to specific problems. Now that we have seen an overview of how IoT works, let us look at its application in the most relevant sectors.
Sectors that can benefit incredibly from IoT
Banking and finance
People have come a long way ahead of traditional banking and finance. Today, people are used to making brisk financial transactions through a range of connected devices. Within seconds you can receive money from someone via a payments app and it is credited directly to your bank account. Have you ever thought about the kind of robust IT framework that enables such quick transactions? Having said that, IoT is already transforming the finance sector. However, the scope for its integration in this sector is even wider. You will be stunned to learn about the projected growth of IoT in the banking and finance sector. How much growth do you think is too much growth? In the next couple of years, the share of IoT in the financial sector is expected to grow at a CAGR of 52.1 percent. From a value of USD 249.4 million in 2018, it is estimated to reach USD 2030 million by 2023 according to a report.
IoT can add even greater security and customer convenience in the finance sector. Banking and financial transactions involve huge data. With the help of IoT, financial risks for individuals and businesses can be calculated with greater precision. To add, banks can start depending on sensors, and data analytics to gather more customer data. Based on this data and having analyzed investment patterns with the help of IoT, banks can then offer more personalized services to customers. Finance companies and banks will have a better understanding of the investment and buying patterns of customers. To add, banks can come up with interactive cards, optimize customer experiences, offer more deliverables, and automate business processes. As you can see, this sector can be among the top gainers from the application of IoT.
The healthcare sector too is undergoing a paradigm shift. From maintaining records to conducting surgeries, technology is facilitating human effort in every domain of this sector. Given the abundance of data included in the healthcare sector, IoT can be applied at various levels to optimize healthcare services. As cited by Fortune Business Insights, the size of IoT in the healthcare sector is anticipated to grow at a CAGR of 25.9 percent and reach USD 446.52 billion in 2028 from USD 89.7 billion in 2021. You can figure out the kind of technological changes we are set to see in the sector in the coming years! We already see tracking systems, remote diagnostics, state-of-the-art healthcare equipment based on Artificial Intelligence, and so on in healthcare centers. In fact, the COVID-19 pandemic has pushed for the greater inclusion of innovation and artificial intelligence in the healthcare sector. There is a greater demand for increased efficiency in the healthcare system and the creation of new and innovative healthcare facilities.
Furthermore, there are other ways too in which the healthcare sector can leverage IoT. IoT can be applied to monitor patient health even from remote locations and minimize hospitalization. To add, IoT-enabled sensors can be utilized to track the locations of emergency medical equipment. Also, lights, fans, and other appliances with IoT sensors can help hospitals in preserving electricity and hence reduce their operational costs and electricity bills. Moreover, IoT-enabled devices to keep a track of calories, blood pressure, heart rate, and other indicators of health can be a big boon for the sector.
Manufacturing involves the use of heavy machinery and sophisticated equipment. Also, in the manufacturing sector, the labor is exposed to various accidents and other safety risks. But IoT can help the manufacturing system reduce its energy consumption and accidents. Moreover, it can make the manufacturing processes far more streamlined and reduce operational costs while increasing efficiency. In fact, IoT is being termed as the largest driving force behind the fourth industrial revolution. Also, the manufacturing sector happens to be one of the largest investors in IoT technologies. According to a market report, the share of IoT in the manufacturing sector is projected to reach USD 53.8 billion by 2025 with a CAGR of 10 percent.
The manufacturing sector can benefit from the prowess of IoT in a plethora of ways. One such area is the remote management of equipment. To explain, it can enable people working in the industry to track and sustain the performance of heavy equipment. This can lead to greater efficiency and cost reduction in operations and wear and tear of machinery. To add, IoT can also help in monitoring the production flow that can lead to some useful insights. These include the prospects of enhancing the production flow, better waste management, and the elimination of needless tasks in the inventory of the process.
To continue, Internet of things can help the manufacturing sector in an incredible way when it comes to supply chain management. With IoT solutions, manufacturers can track assets and the vehicles that are a part of the supply chain. This can boost the efficiency of supply chain operations in umpteen ways. Also, as of now, the manufacturing sector is the one that does not offer a considerable volume of work from home jobs like other sectors. This is for the simple reason that production cannot be remote. However, with greater integration of IoT, at least some verticals of manufacturing jobs can translate into remote jobs leading to critical breakthroughs.
The retail sector is a booming industry and even in the times of the COVID-19 pandemic, it continued to flourish. IoT and automation have already overhauled the retail industry to a large extent. As cited by Digiteum, the value of IoT in retail is expected to reach $ 94.44 billion by the end of 2025. Thanks to IoT, Woolworths could come up with contact-less delivery services and ‘click and collect’ shopping options for Australian citizens to ensure safety during the pandemic. Also, have you heard about the Amazon Go stores yet? Technology is changing the face of the retail sector and at Amazon Go stores, people do not have to stand in long queues to checkout. They can just pick whatever they want from the store, scan the code on the Amazon App, and just walk out. Rather than paying at the billing counter, payments will be processed automatically and customers will be charged from their credit cards. Can shopping experiences get any better?
Also, Internet of things in the retail sector can enable smart inventory management and optimized customer experience. With the use of IoT solutions, retailers can use surveillance cameras and social media insights to get deep insights into customers’ purchasing patterns. Furthermore, RFID tags and GPS sensors can help increase the efficiency of supply chain management in the retail sector. This will offer the opportunity for real-time tracking of goods right from the manufacturing hubs to stores. Probing further, IoT solutions can lead to a larger network of innovative retail stores where checkout and payments are automated. What also needs to be considered here is the ways in which AI is improving online retail.. The entire face of the retail industry can change for the better with the large-scale inclusion of IoT. If you are a retailer, IoT is here to reinvent your fortunes!
As per insights from Statista, the value of the Internet of Things in the global energy market is expected to reach USD 35.2 billion by 2025. This gives you a clear idea of how the energy sector is looking forward to refinements and growth via IoT. The Internet of Things has begun to reinvent and revolutionize the energy sector that is looking forward to a paradigm shift from non-renewable energy to replenishable sources. As per another report featured by Forbes, 45 percent of energy ventures will soon be switching to IoT solutions to supervise asset performance. To add, 34 percent of energy companies are integrating technologies like drones with cameras to keep an eye on the safety and security of their infrastructure. A lot of companies in this vertical are also turning to the Internet of Things to enhance customer experience.
There are many other ways as well in which Internet of things can improve energy sector operations. IoT can help energy companies in the management and monitoring of assets. Also, Internet of things solutions can offer better grid balancing, load forecasting, research, and development of new technologies in power generation and process optimization. From power generation to the transmission of power, IoT can drive some extraordinary breakthroughs. Given how the traditional energy sources are close to getting exhausted, IoT can work as a new ray of hope for the future of the planet. The energy sector’s dependence on IoT only seems to get bigger in the coming years.
To conclude, IoT is the future of the planet and the way forward. People who understand the overwhelming scope of IoT are already integrating IoT into their businesses. Internet of things has something in store for businesses of almost all kinds and all the sectors in the commercial realm. As illustrated in this post, the above sectors can be the biggest gainers from IoT solutions. From asset management, supply chain management, better customer experiences to automated payments, IoT is proving to be a game-changer in all domains. In the years to come, we will see an even greater inculcation of IoT solutions. We must embrace the change and enhance our knowledge around IoT to facilitate better adaptability.