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Future of the Customer Service Industry with IoT Technologies

Author: Robert Agar
Robert Agar Article author

The Internet of things and customer service are coming together to change the way companies do business. Organizations that ignore this emerging paradigm will have a hard time competing with their market rivals. We’re going to look at the role of IoT in customer service and the benefits it provides to businesses.


The Role of IoT in Customer Service

Companies operating in today’s extremely competitive business landscape are continuously searching for ways to differentiate themselves from their competition. One method many businesses adopt is to attempt to enhance the customer experience whenever possible. This mindset helps an organization grow by retaining its current customers and attracting new ones.

Word of satisfied or dissatisfied customers can quickly spread via social media and other communication channels. It is in a company’s best interest to ensure that the majority of publicity they receive is positive. Customers can easily find alternative options if they are unsatisfied with the way online businesses address their desires and concerns.

Number of IoT-connected devices worldwide

The number of Internet-connected devices that make up the IoT is rapidly increasing and it is estimated that it will reach almost 30 billion by 2030, according to a Transforma Insights report. There are many types of IoT devices ranging from intelligent consumer appliances to equipment that controls automated assembly lines. The devices provide raw data that is collected and analyzed by applications and systems running on cloud platforms.

Innovative companies are identifying ways to use the IoT for customer service. By turning the information available from IoT devices into actionable insights, organizations can increase customer engagement and satisfaction. An IoT-based customer experience can give a company the competitive advantage with consumers that it needs to thrive. Let’s look at the benefits of combining customer service with IoT technology.

The Benefits of Utilizing the IoT in Customer Service

Companies and their customers both enjoy benefits by incorporating the power of the IoT in customer service. In some cases, business operations can be streamlined and optimized, providing companies with substantial financial and resource savings. Customers can also benefit in a variety of ways from the availability of real-time data generated from IoT devices. Following are some of the advantages of using the IoT for customer service.

Increased personalization

The data collected and stored in cloud-based systems and databases from intelligent, IoT-enabled devices provide a wealth of information about a company’s customers. This information enables an organization to tailor its offerings to better suit a specific customer’s tastes or requirements. Businesses can offer attractive discounts on products based on a customer’s past purchasing history.

Customer service can also be personalized by the inclusion of IoT technology. The same information that can guide marketing drives can be used by customer service reps to offer personalized support. In many cases, the data available to the customer service team facilitates a speedy resolution to a customer’s problem. The precise information generated from connected IoT devices allows customer service teams to provide personalized solutions.


Automation is an excellent example of how implementing the IoT in customer service solutions can provide benefits for both a company and its customers. From a company’s perspective, automating repetitive tasks can save time and money. Agents can be more productive by addressing high-level issues while automated solutions are processing more basic customer concerns such as remotely restarting a device or checking its status.

The automation made possible by employing the IoT for customer service can be used to provide self-service solutions that don’t require interaction with a human agent. Information sent to the cloud from IoT devices enables some issues to be automatically addressed without the customer’s involvement. This raises customer satisfaction as their issues can be resolved before causing any disruption to their lives.


IoT devices continuously monitor business systems to provide an informative view of operational status. This includes tracking inventory to ensure adequate supplies are available to meet customer expectations. An IoT customer service solution may supply this information in a user-friendly interface or dashboard so it can be accessed easily by agents to streamline customer interaction.

More efficient customer service results in satisfied customers who will help promote a business through social media or word-of-mouth. The elimination of long wait times can be the difference between cultivating a loyal customer or creating one who looks for alternatives after a frustrating interaction with customer service.

Real-time data access

Real-time access to customer data can be used in a variety of ways to create a more engaging experience. An enhanced customer experience can be offered with targeted ads and discounts presented to shoppers as they move around in a retail establishment. Information on product inventory can help agents answer customer questions effectively and provide informative solutions to problems.

Innovation in IoT customer service solutions relies on the timely delivery of data. Customer service teams can proactively address issues before they become problems with access to reliable real-time data. The automation previously discussed also depends on providing real-time information to automated processes so it can be acted upon.

Advanced analytics

Using the IoT for customer service presents companies with the possibility of using the collected data to perform advanced analytics. The data companies gather from IoT devices is processed by software in the cloud and analyzed to better understand customer trends and expectations.

The insights companies gain from advanced analytics provide a competitive advantage over less data-savvy rivals. Companies can optimize products and services based on the information furnished through advanced analytics. Organizations can identify trends and introduce innovative solutions before their competition.


IoT infrastructure is designed to provide robust security regarding the data transmitted from remote devices. End-to-end encryption is one of the primary methods of ensuring the privacy and security of information gathered from IoT devices. With encryption, customers can be confident that data generated from their IoT devices is kept secure.

It is critical that security is taken seriously in an IoT customer service solution. No matter how beneficial the system is, it will never reach its potential if it is not secure. A data breach affecting customer data can ruin a company’s reputation and essentially put them out of business.

Limitations of the IoT for Customer Service

Some limitations can hinder the potential of companies attempting to implement the IoT in customer service. In some cases, these limitations are purely physical and can be surmounted with additional technological advancements. Other limitations directly affect the workforce and the way society views the automation of various job categories.

Energy requirements

The energy required to power IoT devices can limit their ability to be used in edge or fog computing environments. To be used effectively in customer service, IoT devices need to have a reliable and consistent power source. In situations where connectivity to the electrical grid is impossible, an IoT energy-saving system like battery-powered or self-powering devices need to be deployed. These may be more expensive and require more extensive maintenance to replace batteries or repair solar power collectors.

Expensive implementation

It can be expensive to implement and maintain an IoT customer service system. There are the initial costs of providing IoT devices and maintaining them to ensure consistent connectivity to facilitate data transmission. Additional costs are required to procure the cloud systems necessary to process the data and furnish the expected benefits. In cases where there are power concerns, the cost of performing maintenance like battery changes needs to be considered when designing the system.

Potential data risks

Despite the security measures built into IoT devices and end-to-end encryption, there are always potential data risks. IoT endpoints can pose an attractive target for hackers and misconfigured equipment may not provide the necessary degree of security. Companies need to prioritize the security of customer data or risk losing their confidence.

An IoT for customer service solution can’t skimp on data security. Each IoT device offers an entry point into a company’s network and needs to be securely configured. Customers need to know that their sensitive personal information is secure from cybercriminals or they will take their business elsewhere.

Threats to the human workforce

The automation and efficiency provided by using the power of the IoT in customer service can pose threats to the human workforce. In some cases, companies may be able to reduce the number of customer service agents in favor of automated, IoT-driven solutions. This may threaten to eliminate a class of jobs that previously required a skilled and trained individual to perform effectively.

Societies will have to decide how far to take the automation and efficiency made possible by IoT customer service solutions. There should still be opportunities for skilled representatives to participate in creating an optimal customer experience.


The considerable potential of IoT customer service solutions makes it very likely that they will become the norm across all sectors of business and industry. The efficiency and access to real-time data offered by IoT systems provide companies with multiple methods of streamlining and improving the way they deliver customer service. Innovative methods of interacting with its customers can give a company the competitive edge it needs to dominate the market.

New methods of using the IoT to enhance customer experiences will continue to be introduced into the marketplace. The benefits of using the IoT for customer service outweigh the limitations of the technology. Businesses cannot ignore the insight into trends and consumer expectations made possible with carefully designed IoT customer service systems. They will soon become the standard way to provide customer service.