Smart Services - A competitive advantage of the future
Every industrial manufacturer knows that relying solely on product margin for profit on a competitive market makes the company very vulnerable to competition. Many manufacturers therefore bundle value-adding services with their products to strengthen customer loyalty and to add new sources of revenue.
But what if you and your competitors are already doing that? What would then be the next step to retain customer loyalty and maintain a positive profit margin?
Smart services is an increasingly popular strategy applied by industrial manufacturers to maintain their competitive advantage by turning themselves into connected service providers. According to renowned research-institute Harbor Research, successful implementations of a Smart services strategy can result in more than 50% of manufacturer revenues and 60% of margin contributions deriving from smart services compared to product sales!
At the core of the Smart services concept lies the idea of a remote, real-time connection between each delivered product and the manufacturer using the internet or some other digital network as a carrier. When receiving frequent status updates from your products is possible, and even communicating with the products, a variety of business opportunities open up. Such as
- reducing or avoiding customer down-time. A machine can signal if it is about to fail, so that any failing part and depleted consumables can be replaced to avoid a failure; service technicians can perform support and install software updates remotely; regular service visits can be scheduled after actual usage rather than according to the calendar
- improving customer productivity. By storing and analyzing usage patterns, a product can be optimized for the needs of specific customers and individual users. Products can even be taught to act more intelligently by providing them with real-time information
- improving product development. Monitoring and analyzing actual usage data can provide a manufacturer with many ideas for improving functionality and usability of existing products and developing new ones
- giving customers access to the product interface and data. Depending on the product, it might be of great use to your customers if they themselves are able to monitor and communicate with the products you have delivered
Here are some real-world examples of Smart services:
Printing presses, elevators, vehicles, washing machines, dishwashers, manufacturing and medical equipment signaling when they are about to fail
Cars giving drivers advice whilst driving, making them better drivers; warning drivers of obstacles and suggesting alternate routes or preparing the driving system for the more extreme driving conditions ahead
Buildings, facilities and private homes keeping owners and maintenance personnel informed about overflowing toilets, and ensuring the safety of its occupants by alerting the police in case of a break-ins and warning the occupants of approaching storms, fires or other disturbances
Trucks, cars and other vehicles reporting real-time environmental data, keeping companies and consumers informed of their individual CO2 emissions and fuel consumption
Medical implants that can be monitored and updated remotely
Electricity pylons, parking meters and vending machines communicating with the supply and billing system as well as technical support
Smart services is the next step for manufacturers wishing to become 21th century service providers. Contact us at sales@info24.se for more information.