Digi-Key: Holistic Approach Needed to Be an IoT Distributor

‎Robbie Paul, Digi-Key’s director, IoT business development, doesn’t want to sell Internet of Things technologies for the sake of it. Paul would prefer all of the company’s enterprise customers shopping for IoT technologies have a fundamental understanding of the business problem they’re trying to solve. From there, the company can offer a suite of technologies to help tackle that problem. “It’s not a complete kit, but a solution that will fit 80 percent of your needs,” said Paul, who is speaking on the subject of IoT procurement at the Sensors Expo & Conference. “You’ll need to tweak it to fit whatever nuances your particular problem is.”

That approach may seem simple, but the strategy is forcing the company to make a shift from selling discrete components to a “solution sell,” as Paul put it. That requires that Digi-Key learn more about software and related services while also building out its network of software partners and other vendors who can help its customers meet the needs of a specific project.

“Rather than pinpointing particular use cases, we step it up a little bit and focus on verticals,” Paul explained. Examples of application areas include agriculture, enterprise, logistics, industrial and utilities.

The potential number of technologies that could be used for even one industrial application is “almost infinite,” Paul said. “How do you put together an agricultural kit?” He asked. There are so many variables involved that having a substantial amount of customization is a prerequisite. “Is your agricultural technology going to be in the ground and get wet? Is it going to be on a tractor and therefore need to withstand a lot of vibration?” Paul asked.   

Because Digi-Key is focused on mass-market technological applications, it doesn’t rely on internal field application engineers to help its customers wade through the minutia of a specific customer project. In this regard, the company also works to help educate its user base through articles on its website and by selling educational kits, including IoT starter kits, which help its customers “learn about a particular technology or a facet of IoT,” Paul said. “The intent of a starter kit would never be to develop that end solution; it’s more about a development tool.”

Ultimately Digi-Key has a vested interest to see their enterprise and industrial customers not just dabble with IoT technologies, but have a solid business strategy behind those projects. A customer interested in predictive maintenance, for instance, might order a temperature sensor for a motor application. But when a motor gets hot, that’s a sign there is already a problem and that failure might be imminent. But if the same company launched a proof-of-concept IoT project with a vibration sensor, they might find that it helped them detect a problem months before motor failure occurs. “Say you’re in a factory with 1,000 motors in it. Knowing three to six months in advance before your motors fail is a big deal,” Paul said. “You can run a whole predictive maintenance program with that information.”

To meet the needs of that factory owner or the majority of Digi-Key’s other IoT-interested customers also requires considerable coordination. “A trend we’re seeing at the supply chain level is a lot more partnerships amongst manufacturers working to put their products together to form a solution,” Paul said. “We just kind of naturally fit into that because we have so many vendors and we’re able to do that coordination for them.” For example, an IoT project might require that a sensor manufacturer work with a microprocessor vendor and a telecom. But those companies may not have a close relationship. “We could facilitate that collaboration. We’ll say: ‘Hey, we’ll use a sensor from this company, a processor from that company and we’ll use connectivity from this telecom over here.’ We’ll put this whole solution together and spin it around a particular vertical.”