Put a knob on this and keep it spinning. This can be used as a selector device and can continuously turn. Rotary encoders like this is generally used as a device to select options on a control panel. As you turn the encoder, you can expect to get a pulsing and you can determine the direction that it is turning and how many pulses to determine how far the knob is turned. The product is considered 12 mm, but make sure to take a look at the images to see the actual dimensions.
