Best IoT Application Development Guides for Startups

IoT application development enables business organizations to gain more insight into their brands using analytics and data to create new business models, generate more revenue, and deliver improved customer experiences.

90% of companies that took part in the Microsoft IoT Signals survey in 2021 have already adopted the IoT solutions to reduce operating costs, 35% of Internet of Things projects stall at the proof-of-concept stage, while 75% of all Internet of Things initiatives never materialize into market-ready products.

Best IoT Application Development Guides for Startups

There have been many advancements in IoT technology in recent years. More than just industry Jargon, people are using the Internet of Things in incredible ways to ensure

  • Human safety
  • Environmental sustainability
  • Ease of living

IoT Technology is making integration increasingly expected in the things we buy, the services we depend on, and even what we wear.

The IoT application development lifecycle spans several stages, including

  • Idea validation
  • Discovery phase
  • Actual development

This IoT application development guide will help you sail through these stages to avoid costly mistakes and successfully launch an Internet of Things solution for your brand. Many companies that struggle with IoT application development cite the following.

  • High scalability costs
  • Technical challenges
  • Vague Return On Investment perspectives

As the critical reasons for IoT application failure, as a startup looking to create an Internet of Things solution for your organization, you could avoid most of these challenges by carefully planning your Internet of Things pilot in advance.

Why is this IoT application development helpful guide?

  • To help startups understand IoT application development
  • To help organizations build an IoT application and the accompanying software ecosystem in a risk-free way

We are starting an article series that dives into IoT technologies and IoT application development best practices.

But, this blog will focus on the

  • Internet of Things definition
  • IoT solution Architecture
  • Stages your connected application goes through

What Is an IoT Application Development Exactly?

The Internet of Things application development is a network of physical objects connected to the Internet and each other over a wired or wireless network.

The “things” term may apply to electronic devices, such as fitness trackers and non-electronic objects enhanced with sensors and lightweight control gadgets (think bright curtains operated via a relay and mobile app).

2 types of IoT solutions you could create:

  • Sensing IoT applications, which measure information on the surrounding environment and convert it into digital signals
  • Actuating applications, which receive digital signals from the network and act upon them

These IoT applications can talk to the nodes within an Internet of Things ecosystem (i.e., peer-to-peer communication), connect to the network via a gateway, or establish gateway-less connections.

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What is IoT Solution Architecture?

It is essential to understand how connected solutions function under the hood to create an IoT application or non-electronic gadget scavenging and acting on environmental data.

The 4 levels of Internet of Things Architecture

Application layer

This layer features embedded software, i.e., firmware or proper operating systems that run on sensing and actuating devices. It may also include

  • Mobile
  • Web
  • Desktop applications

To help users interpret sensor data and manage gadgets. So if you’re looking to create an IoT application, we have gotten some good news for you: applications are just the tip of the IoT iceberg. Service and application support layer

Essentially, this is the Internet of Things infrastructure layer where

  • Data aggregation
  • Storage
  • Processing operations take place

To save costs and ensure uninterrupted device/service performance, Internet of Things startups often choose to set up this infrastructure in the cloud.

Network layer

On the network level, IoT engineers can implement cellular, Wi-Fi, and wired connectivity technologies to interface the components of an IoT ecosystem, i.e.,

  • Things
  • Back-end infrastructure
  • User applications.

Device layer

We could segment the functionality enabled by the application layer into:

  • Gateway capabilities: IoT gateways support devices connected through wired and wireless technology, such as
    • Bluetooth
    • Zigbee
    • Z-Wave
    • LPWANs
  • and perform protocol conversions, enabling devices with different connectivity tech stacks to communicate.
  • Regular device capabilities: IoT nodes typically collect and share data. But they can also construct networks on the fly to accommodate new nodes or replace an existing malfunctioning device. Also, some IoT devices can display limited data processing functionality (i.e., edge IoT deployments) and switch between sleep and awake modes to save energy.

The Internet of Things architecture also incorporates application management and security components. The former helps resolve.

  • Traffic congestion issues
  • Monitor IoT product performance
  • Roll out software updates
  • Track device activation and deactivation

The latter ensures privacy protection and data confidentiality and supports application-specific requirements, like facilitating secure mobile payments.

Commonly, this functionality is baked into popular IoT platforms, such as

Stages of IoT Application Development Lifecycle

Prominent IoT infrastructure vendors like Microsoft and Google distinguish 4 stages of the IoT application development process.

  • Learn
  • Trial/proof of concept
  • Purchase
  • Use

To develop an IoT application with strong commercial appeal, you should start your IoT application development journey with thorough market research, which include

Assessing the demand for your IoT solution

Besides studying research papers issued by technology consulting companies like Gartner and Accenture, you could conduct in-depth interviews with experts and potential customers from your target domain — e.g

  • Healthcare
  • Wellness
  • Manufacturing
  • Retail, etc.


Analyze the macro-and micro-environmental factors affecting your brand using marketing frameworks like

  • Temples
  • Vrio
  • Porter’s Five Forces

You should pay special attention to the data privacy and security laws governing IoT adoption in your target geographic locations, as well as industry-specific regulations for IoT applications, such as

  • HL7
  • NIST

Getting to know your competition

Competitive analysis can help you determine the optimum feature set, pricing, and marketing strategy for your IoT application as part of the macro-environmental audit.

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Your goal here is to identify an unoccupied niche and offer something — i.e.

  • A piece of functionality
  • Competitive price
  • Superior quality
  • Five-star customer service — that your competitors are missing.

Choosing a suitable IoT business model

Drawing on the insights from the market and competitor research, your company should choose an appropriate business model to monetize your IoT application. Some popular options include one-time purchases, subscriptions, and the monetization of accompanying services and products, such as sensor data analysis.

To better align your service offering with your company’s mission, resources, and marketing mix, you could use the Business Model Canvas template by Alexander Osterwalder.

Estimating the efforts required to build an IoT application

In this step, you need to summarize your market research findings using the SWOT analysis and determine what resources and capabilities you lack to create an IoT application and the applications supporting its logic.

Based on your company’s primary focus

  • Hardware
  • Embedded
  • Web
  • Mobile

You will figure out which parts of IoT application development need to be outsourced.

IoT Application Development

Being part of the IoT application infrastructure, user-facing applications help configure and manage connected devices and visualize sensor data processed in the cloud. Depending on your overall IoT application requirements and target audience, you might need to create:

  • Native or cross-platform mobile applications, which‌ act as a remote control for IoT applications
  • Embedded human-machine interfaces (HMIs) that allow users to operate devices without a mobile or web app
  • Web-based or desktop applications that mirror the functionality of their mobile counterparts and allow IoT product admins to manage user accounts

Factors to Consider During IoT Application Development

With exponential growth forecasted in the area and the growing trend for IoT solutions, it is pretty clear that IoT application development innovation will play a crucial role in business success over the following decades.

A good, well-designed, and reliable IoT application is critically important to integrate with IoT devices, as customers will only buy the device if the application is up to standard.

Let’s take a look at some of the main factors (apart from UI/UX) that will determine the success of your IoT application.

Build Security Gaps Plug

One of the main problems with IoT systems is that they lack standard security protocols. The lack of security leaves IoT applications open to hacking and cyber attacks such as DDoS attacks.
In 2016, the Dyn cyberattacks infected IoT technology such as

  • Printers
  • Webcams
  • Baby monitors and other devices

The malware was used to execute the attacks, causing significant problems worldwide. The best way to prevent hackers and cybercriminals from exploiting the inherent vulnerabilities of IoT applications is to build applications that plug the gaps and protect the transfer of data.

Many IoT application developers are building communication layer security such as TLS or DTLS into their apps. There have also been some advances in the application of blockchain technology to encrypt data in IoT applications.

Artificial Intelligence Data Analysis

The basic workflow of an IoT application system is made up of 5 steps.

  • Create
  • Communicate
  • Aggregate
  • Analyze
  • Act

The IoT application sensors communicate data through a network gathered in the cloud. The next stage is data analysis performed by an IoT application and can be enhanced with Artificial intelligence and machine learning technology.

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Building an AI engine or machine learning algorithms into an IoT application allows device creators to get data insights rather than raw data. Can then be used data insights to improve workflows.

For example

Robotic arms on a manufacturing assembly line can be fitted with IoT sensors that feed data to an IoT application. The AI can interpret and analyze the data to find areas where production slows down or efficiency improvements could be made in energy usage, for instance. Using these insights can improve operations on the assembly line.

Opportunities for Business Organizations

Investing in custom IoT application development creates the following business opportunities:

  • Automation of business processes and services
  • Optimize productivity
  • Improved data sharing across businesses
  • Enable more productive remote working
  • Rapid response to changing circumstances
  • It will lead to cost reductions

IoT solutions shouldn’t be considered as a fixed investment to solve technical tasks, as they can grow with time and develop into a separate ecosystem, managing many different processes and workflows.

For instance, imagine a business that makes machine-milled parts for the automobile industry. By developing an IoT application that links with their assembly line and CNC machine sensors, they can get real-time notifications of any machine problems or failures.

Doing so will allow them to quickly respond to problems, rectify them, and get production rolling again. It can also help to automate tedious processes. Quality control can be done using IoT sensors coupled with AI instead of visual inspection.

Create A Continuous User Experience

Custom IoT application allows a business organization to embrace the agile Continuous User Experience (CUE) methodology. Continuous User Experience involves getting data and information from anyone using an app.

Users can analyze all of their data and learn exactly how the app’s users interact with the data. It will help improve and refine the app based on user queries, making it user-friendly. Optimizing the app allows users to build customer loyalty and get ahead of their competitors.

The good news is that software development activities can run in parallel with custom hardware design. And if you’re developing IoT applications on a shoestring budget in the hope of getting funded, you can skip the hardware design part altogether and make do with an off-the-shelf board for the time being.

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Best IoT Application Development Guides for Startups