“Total Customer Experience”

oT products are changing the way companies compete as well as reshaping how they are organized and execute business processes. IoT represents a significant opportunity for companies across all industries and is changing the way products are designed, supported, and used. These changes include how customers interact with companies and their products. These interactions are what we call customer experience. Companies are increasingly enhancing the value of their offerings through connected devices to create the “Total Customer Experience.

Customer experience is about delivering the experience that customers want to have again and again. To do this, companies must understand the touchpoints between their customers and their organization to improve on the experience they provide. The primary elements of customer experience are at the touchpoints created by people, processes, and products. When customers interact with these touchpoints, they have a positive or a negative experience. It’s the positive experience that makes them loyal returning customers, and the negative ones will drive them to a competitor or an alternative product.

A study conducted by Bain and Company found that even though 80% of organizations believe that they had a superior experience, the customer surveys showed that only 8% of the researched companies delivered a superior experience.

These results indicate that there is a clear gap between a company’s perception of the experiences they provide and the customer’s expectation of the same experiences. I call this the “Experience Perception Gap.”

Using IoT to bridge the “Experience Perception Gap.”

As IoT networks grow, they become more valuable.

Metcalfe’s Law states that increasing the number of connected sensors drives exponential value in the network as more sensors are added to the network; they provide near real-time information on the people, processes, and products being monitored.

This increased visibility allows algorithms to adapt predictions and recommendations in near-real-time.

Companies are bridging the “Experience Perception Gap” by developing a customer-centric experience strategy paired with IoT technologies that focus on improving the touchpoints created by people, processes, and products.


IoT applications that collect customer behavioral data is one example of how IoT is improving customer experience. The customer acts as a data provider by allowing a company to capture their interactions with them using IoT sensors. The company then organizes, stores, and analyzes the data related to these interactions to improve their customer’s experience. This activity allows the company to capture data from touchpoints that involve human interactions between the company’s employees and its customers.

IoT platforms that use artificial intelligence (AI) and machine learning (ML) sentiment analysis are providing companies with the opportunity to measure how well they are delivering on these human interactions and improve on them. This activity also empowers the customer to contribute to the changes they would like to see in the organization. This customer contribution is often referred to as the “Voice of the Customer,” and is a powerful tool for companies to improve their customer experience.

The near real-time decision-making ability created by an IoT platform is enabling employees to act on predictions and recommendations as interactions are happening. By allowing their employees to make a decision that is related to the customer, it increases the chances of delivering a positive experience. Additionally, studies have shown that empowered employees have higher day-to-day engagement, and this, in turn, correlates to lower employee turnover. Higher employee retention rates can improve the company’s ability to deliver a consistent experience for customers across numerous physical and digital touchpoints.


IoT platforms are allowing companies to connect low-cost, high-speed chips and embedded sensors through networks. These embedded sensors are collecting data from the edge, where customers interact with a company’s products. Edge devices contain monitoring capabilities, thus creating insight into the company’s product location, performance, and status. By monitoring a device’s performance, its operation is then optimized.

Embedded sensors are also providing valuable insights into how customers are using the company’s products to help predict product failures, allowing the company to intervene before a breakdown happens. Real-time recommendations and interventions are creating a proactive operating model, resulting in less reliance on rule-of-thumb practices. This proactive approach to managing a company’s products is improving customer experience in several ways, including creating better predictive customer interaction models or reducing downtime created by product failures.


IoT applications are allowing companies to collect detailed data about their business processes and operations. Business processes rely on monitoring, control, or management to make business-critical decisions and optimize actions across the organization. The data collected by IoT applications are providing for better business intelligence and more informed decision making about customer experiences related to business processes.

Another promising IoT use case that has positively impacted customer experience is in inventory control. Many large companies with complex supply chains and inventory operations miss their “on time in full” (OTIF) delivery targets using traditional enterprise resource planning (ERP). IoT solutions are helping companies improve their OTIF delivery targets. Thus, reducing the response time to deliver their products to customers and reducing stock-outs. If the customer can get what they need when they need it, this is a positive experience.


According to Gartner, over 80% of organizations expect to compete mainly based on customer experience in 2020

With the total number of connected devices projected to be around 75 trillion by 2025, IoT is poised to fundamentally change how companies do business and reshape their customer experience.

First, IoT is bringing about new computational power. This new computational power is resulting in the ability to deliver real-time AI and ML solutions that provide for better decision making. Algorithms will begin to play a more significant role in the decision-making process. This increased role will be particularly true for the day-to-day decisions that help companies deliver their customer experience.

Second, IoT is changing the way companies execute business processes. These changes are resulting in faster, more efficient, and less expensive decision-making. Employees are being freed up to focus less on implementing business processes and more on delivering customer experience.

Third, IoT is changing the way companies differentiate their products in the marketplace. We will see higher levels of the individuality of product behaviors to match the customer’s preferences. We have already started to see some of this individualization. Smart thermostats learn a homeowner’s temperature preferences and automatically adjust. In health care, intelligent heart monitors alert doctors and patients of an abnormal reading. And, smart glucose monitors can automatically adjust insulin delivery to accommodate a patient’s needs.

IoT will continue to change the way companies compete in the marketplace in the coming years. Companies are beginning to deepen the customer relationship by leveraging what they know about a given customer to personalize offerings. Others are focusing on the breadth of the customer relationship by adding touchpoints. Research has shown that the highest-performing brands are doing both and providing what some are calling the “Total Customer Experience.”


“Closing the Delivery Gap: How to Achieve True Customer-Led Growth.” Bain, 21 Aug. 2018,

Porter, Michael E., and James E. Heppelmann. “How Smart, Connected Products Are Transforming Competition.” Harvard Business Review, Nov. 2014.

The Ultimate Marketing Machine — Harvard Business Review.