Make revenue more resilient with smart, connected products
Manufacturers are making smart, connected products to enhance customer relationships, generate more revenue & more.
This post was updated on March 17, 2023.
Manufacturers are feeling pressure to deliver new products and capabilities faster than ever. Connected products are the solution.
By delivering products that are intelligent and connected, manufacturers can build a brighter future and a more sustainable future. Beat the competition by delivering a better customer experience, while creating totally new sources of revenue that are resilient to business cycles.
Not yet offering connected products? Your competitors are – or will be soon. Customers are looking for smart, connected equipment – it helps them cut maintenance costs, reduces downtime, and enables them to meet sustainability objectives. According to McKinsey, remote asset condition monitoring can reduce maintenance costs by 30% and cut machine downtime by 50%.
Uptime equals revenue for your customers, and this gives you every incentive to make smarter products for them. Products that monitor equipment health and catch problems before they arise and drive efficiency. Plus, acting on real-time data enables you to be more proactive and efficient with service calls, keeping your customers happy.
Remote monitoring and predictive maintenance are just the start. Manufacturers that create smart, connected products can use equipment as a platform to transform their business in four ways:
- New revenue streams. You can grow revenue by increasing sales of services, consumables, and components. Services revenue tends to be more repeatable and resilient than hardware sales and McKinsey has found that margins for services can be up to four times higher than equipment sales.
- Faster product development. When you know exactly how and when your products are used, you can accelerate the launch of new valuable features, and retire unused features just as fast.
- Increase customer satisfaction. You can improve the customer experience using insights on usage and performance from your connected products. Additionally, you have the ability for immediate issue resolution.
- Shift to Equipment-as-a-Service (EaaS) business models. Just as cloud and Software-as-a-Service (SaaS) helps customers shift from Capex to Opex, EaaS helps customers keep expenses in line with revenue and better manage costs. At the same time, transitioning to an EaaS business model helps you generate subscription revenue, which is more consistent – and resilient – than equipment sales.
Smart, connected IoT products
What does the future of smart, connected manufacturing look like? Some of our customers are showing the way.
Dürr, which makes and services robotic paint stations used by major vehicle manufacturers, has customers that needed to avoid expensive errors during the painting process. With real-time data on its paint stations, they create a “digital fingerprint,” reducing errors, efficiently managing waste, resulting in manufacturing costs savings.
PRAB, metalworking’s leading manufacturer of metal recycling equipment, has installed sensors to collect live data on conditions like temperature and vibration. PRAB has enabled their customers to gain visibility and understand how their equipment is performing and get insights that help them prevent downtime while improving ROI. A greater understanding, less downtime, and reduced onsite maintenance visits have contributed to reducing PRAB’s carbon footprint, improved product design, and ultimately, stronger customer relationships.
Lyreco, which supplies coffee machines for businesses, was having trouble assuring inventory and coordinating service trips efficiently. With embedded sensors, the company automates the management of its machines and inventory based on real-time usage, saving both fuel and money, and as a result, reducing their carbon-footprint.
GreenFlex supports companies and territories in all their sustainable development, decarbonization, and energy efficiency issues. Through Cumulocity IoT, GreenFlex manages thousands of devices across customer sites, and through fast and simple implementation, has saved on costs and accelerated the growth of its energy efficiency services.
SMC, which makes a range of air compressor equipment, needed new ways to keep its customers running smoothly. Its “smart field analytics” approach, delivered to market in less than 4 months, uses IoT-enabled sensors to predict equipment maintenance needs and avoid downtime. Furthermore, with new innovations on the way. SMC is working to detect and prevent air leakages in equipment and monitor energy to optimize factory efficiency.
What do these manufacturers have in common? Though they’re operating in different industries and dealing with a range of different challenges, smart, connected devices are helping them transform their businesses with better insights, enhanced customer service, new sources of revenue, and optimize their operations for sustainable growth and a more sustainable world. Want to learn more? Read our eBook to see how manufacturers are building smarter products to get faster, more sustained value. And, if you’re ready to take the next step, contact us to learn how our Cumulocity IoT platform provides all the capabilities you need to deliver smart, connected products.