- Travel, industrial manufacturing, media and telecom industries are the biggest spenders on IoT technology in terms of percentage revenue. Energy, CPG and insurance firms are the lowest.
- Industrial manufacturers have the bragging rights for being the highest revenue generators from IoT in 2014. On the other hand automotive companies generated the lowest revenue in 2014.
- A large part of budget spend on IOT by industrial manufacturers is on product monitoring. Travel and financial companies are spending huge amounts on premises monitoring, as compared to any other sector.
- A significant amount of the insurance industry’s IoT budget is spent on monitoring customers, which is more than other industries. Whereas CPG, energy and automotive manufacturers are spending more on supply chain monitoring.
Sectors in the Fast and Slow Lanes
In our study, we found significant differences in the adoption of IoT technologies among the 13 global industries surveyed.
A major difference observed was in IoT spending and allocation of that spend. Companies related to travel will spend an average 0.60% of revenue this year as against 0.22% of revenue for energy companies. (See Exhibit III-1.)
In addition to energy, the four industries spending the least in IoT technologies are healthcare (0.33% of revenue), retail (0.31%), insurance (0.30%) and consumer packaged goods (0.24%).
Exhibit III-1: Industries Spending the Most (and Least) on IoT
Spend by Core Business Area
With respect to the four core business areas we covered, here are some noteworthy differences observed in proportion to the IoT investments made by industry in 2015:
- Supply chain monitoring: CPG (30.1%), energy (28.0%) and automotive companies (27.9%) are allocating the most here.
- Premises monitoring: Travel-related companies have the largest portion of IoT spend here, at 22.3%, with financial institutions (21.7%), retail (21.4%) and health care (21.1%) close behind.
- Product monitoring: Industrial manufacturers (40.4%) are way out in front on this metric, with media and entertainment companies next (at 34.8% of IoT budget)
- Customer monitoring: Insurance companies will spend a larger percentage of their IoT budgets
Which Industry Generates the Most Revenue from IoT?
It was observed that industrial manufacturing stood above all other industries when it came to how much their revenues increased in 2014 (over 2013) due to IoT initiatives. In this sector, companies reported an average 28.5% revenue increase from IoT. Financial services (17.7%) stood as second and third was media and entertainment (17.4%).The lowest revenue gain was recorded in the auto industry with 9.9% increase. (See Exhibit III-3.)
Exhibit III-3: Industrial Manufacturers Had the Greatest Revenue Boost from IoT
Industrial manufacturers provided the boldest response when asked to project how much IoT initiatives would boost their revenue by 2018 over 2015 (Exhibit III-4). High-tech companies were next, predicting a 19.4% revenue boost.
Exhibit III-4: How Industries Project the Revenue Impact of IoT by 2018