Connected products promise smarter decisions, operational efficiency, and entirely new sources of value. Yet in reality, many IoT initiatives stall after launch, struggle to scale beyond pilots, or fail to deliver real, meaningful value.
When IoT initiatives fall short, it’s rarely because the technology can’t perform. It’s because the surrounding decisions don’t support it. Teams make assumptions about how IoT will integrate into the business, the workflow, and the organization responsible for sustaining it. And those assumptions often go untested.
Below are three of the most common reasons IoT products fail and what teams should consider instead.
1. Added Effort Erodes Value
IoT products are usually introduced to simplify something: improve visibility, reduce manual work, or prevent costly failures. But too often, they end up replacing one problem with another.
Dashboards multiply. Alerts stack up. Integrations become fragile. What started as a solution to save time turns into another system users must monitor, interpret, and work around.
When the effort to setup, maintain, and monitor an IoT solution grows faster than value, adoption quickly drops. Users disengage. The original problem remains unsolved, just buried under new technology.
This isn’t a tooling issue. It’s a design and decision-making issue.
What to do instead:
Be ruthless about clarity. Ask: What problem are we actually solving and what effort are we adding to solve it?
The cost or time required to use a connected product must be dramatically less than the time saved or costs reduced. Incremental value isn’t enough when introducing IoT solutions.
2. Data Is Collected, but Value Isn’t Actionable
Collecting data is not the same as creating value.
Many IoT products fail because they generate data for the sake of collecting it, without a clear plan for how that data will drive decisions, change behavior, or improve outcomes. Predictive maintenance is a common example: insights are surfaced, but no one is equipped, or empowered, to act on them.
Without the right processes, ownership, training, and change management in place, even high-quality insights go unused. The result is a product that looks sophisticated but delivers little real-world impact.
What to do instead:
Design for action, not information.
Ask upfront: What decision does this enable? Who needs to act on it? What happens differently once this insight exists?
The most successful IoT products don’t just surface data, they integrate seamlessly into workflows, clarify responsibility, and support real operational change over time.
3. True Costs and Purchasing Models are Misjudged
It is very common for organizations to develop a business case before investing in developing an IoT product. However, we see challenges emerge most often due to underestimating two key factors:
- The true cost over time to support and maintain the solution.
- The end-to-end buying journey and who makes purchasing decisions.
When it comes to making a connected product, the IoT device is only the beginning. Connectivity, cloud infrastructure, data storage, security, compliance, device management, ongoing maintenance, customer support, and continuous software updates all compound year after year. Teams that focus primarily on “getting the product built” often discover too late that operating it sustainably is far more expensive than anticipated.
One dynamic we often see in the B2B space is a disconnect between those making buying decisions and those who ultimately experience the value of the IoT solution. For example, consider an IoT product that delivers proactive maintenance insights, enabling service teams to work more effectively. When this IoT capability is positioned as an add-on function to the asset rather than core to the product, purchasing decisions are often made by a different group, with service teams brought in after the fact. This disconnect quickly introduces friction in the sales process, limiting adoption of IoT capabilities and significantly reducing the ROI in developing them.
What to do instead:
Think beyond development. Model total cost of ownership early and revisit it often. Be explicit about who is paying, who is benefiting, and how value is returned over time.
Successful IoT products balance desirability, technical feasibility, and business viability from the start. When any one of those is treated as secondary, the product is at risk, no matter how impressive the technology is.
Building Connected Products That Deserve to Exist
IoT products don’t fail because they lack innovation. They fail when teams move too quickly past the fundamentals.
When business viability is clear, complexity is intentional, and value is tied to real outcomes, connected products stop feeling risky and start delivering on their promise.
The goal isn’t more data, more features, or more technology. It’s building something that actually works for the people who use it, the systems that support it, and the business that sustains it.
As a creative problem solver, Dave's goal is to identify and develop innovative solutions that make a substantial and practical impact on people's lives. Our clients and team value his technical and business expertise, which he provides from business development all the way to ideation and delivery.
