Archive for the 'Uncategorized' Category

Software eats the world. Next on the menu: textbooks

In Marc Andressen’s WSJ article ‘Why Software is Eating the World‘, he coins a catchy phrase to illustrate a phenomenon I’ve also been following with pointed interest for years: the relentless disruption of traditional business models by digitally-powered alternatives.

Andressen’s tour through affected industries covers booksellers, video chains, record labels, telecom providers, camera makers and more. In a post in the near future, I’ll empty the contents of my Evernote tag ‘Business models disrupted by digital’ and explore the full extent of the carnage. For now, I’ll just add one more to the list: textbooks.

TechCrunch reports on a new startup called BenchPrep:

The startup licenses textbooks from big publishers like McGraw Hill and converts them into interactive web and mobile learning courses.

As TechCrunch reports with disbelief:

Eventually, publishers might get a clue that interactive digital education is going to destroy their paper book business. If they’re smart they’ll start developing their own courses or raise licensing fees. Until then though, BenchPrep will be the savior of anyone frustrated by the static book-learning experience.

This is the point though. Despite ample evidence of business models being turned on their heads or made obsolete in a matter of months, we’re still seeing giants across every industry falling behind instead of reinventing their products and building these platforms and services themselves.

The textbook industry is a great example. It doesn’t take a futurist to be able to tell you that the near future, if not the present, kids will be learning primarily on their tablets and Macs and iPhones, storing their textbooks in the ether, being spurred on by a gamification layer, given real-time assessments of their learning, cloud-syncing notes and highlights, and revelling in rich media content and visualizations that bring the subject to life, possibly even benefiting from a presentation that is personalized to their particular learning style.

Does McGraw Hill have a well funded innovation lab working on creating exactly this outcome, with a remodelled business model to match? You’d hope so, but history would suggest otherwise.

The opportunity is open to every company to find ways to innovate through technology to provide a better product and experience to your customer, be willing to change your business model in the process, and ride that wave to a new era of success and prosperity. The alternative isn’t pretty: join the world’s most expensive foodspotting list that Kodak and Blockbuster have already made famous.

Service Design for the Internet of Things era

Last post we talked about what Service Design is. Emerging, user-centred, multi-disciplinary, multi-platform. It lives within ecosystems and strives for successful experiences. It’s pretty hard to pin down, but it’s increasingly important. So why does service design matter to businesses and brands now more than ever? Here’s four reasons:

1. Digitally-enabled services are becoming ubiquitous

We’ve all heard of the Internet of Things, or Ubiquitous Computing right? Both terms refer to the explosion of connectivity in our everyday devices. Everything we own is getting networked, from your TV to your car to your bathroom scale.   All that connectivity is cool, but it’s just the hardware — those digital features manifest as services, which require user interfaces and design.

2. Services and products need to exist in ecosystems, and designed and thought in terms of a holistic brand experience

Cool, so we just design those services like we’ve always done for sites and apps, right? The tricky thing about products and services these days compared to the websites we built in 2000 is that they need to exist not as isolated experiences, but as part of a much larger digital ecosystem. An airliner’s kiosk system needs to interact seamlessly with its mobile app, and an in-store digital retail experience should work seamlessly with the iPad shopping app. They are all touchpoints in an overall customer experience of the brand.

3. Well designed services are marketing differentiators, a reason people will buy your product

Nike+ is a reason to buy Nike running shoes. Wiithings is a reason to buy their bathroom scale. Twelpforce may or may not be a reason to frequent Best Buy. Digital services are increasingly being added onto the products we used, not as an afterthought or nice to have, but as a core part of the product proposition. They are a reason you’d buy product x over product y, and for that reason their design becomes business critical.

4. Poorly designed services can destroy customer satisfaction and recommendation

When a service is core to your product experience, and you get it wrong, the results are ugly. Ford plunged from 5th to 23rd in the 2011 JD Power & Associates satisfaction survey, with the primary culprit being identified the MyFord Touch in-car telematics system. Ford aren’t just selling a car, they are selling a driving experience. And the service that lived at the heart of that experience wasn’t good enough, resulting in a vocally disgruntled customer base. The service layer has become as important as the product itself.

Summary = Products companies are becoming service companies, and ultimately experience companies

All of which brings us to the last point. There tended to be a quite clear division for many companies between product companies (like Fiat or Samsung) and service companies (like say Geek Squad). Except now your Fiat comes with EcoDrive, and your Samsung TV comes with an appstore. These companies that are traditionally products companies are now becoming service companies, which requires a different mindset and approach, and different skillsets for success. If you get it right, it can be a major market differentiator. And as you can see in the case of Ford, if you get it wrong, it has very big consequences. The ubiquitous computing era is here, it’s up to us to design services and experiences to make the most of it.
 

What is Service Design?

Service Design is a strange one. It’s been around as a concept since the 80’s, yet many people have never heard of it. And among the ones that have, including those practising it, there’s no commonly accepted definition. An opening quote from the the book ‘This is Service Design‘ says it all: ”If you would ask ten people what service design is, you would end up with eleven different answers — at least.”

The two best definitions I’ve seen are:

“Service Design is an emerging field focused on the creation of well thought through experiences using a combination of intangible and tangible mediums. It provides numerous benefits to the end user experience. Service design as a practice generally results in the design of systems and processes aimed at providing a holistic service to the user” - Copenhagen Institute of Interaction Design

“Service Design helps to innovate (create new) or improve (existing) services to make them more useful, usable, desirable for clients and efficient as well as effective for organisations. wlt is a new holistic, multi-disciplinary, integrative field.” - Stefan Moritz

Clear as mud? The problem in all the definitions is that service design as a concept is so encompassing and holistic that it tends to become fuzzy and hard to pin down. This isn’t helped by the fact that there’s a lot of debate and blurring around whether it’s best even called service design, as a recent article in UX Magazine notes it is often equally (and possibly more accurately) referred to as “holistic design” or “multi-channel experience design”. Holistic design could work but is almost too broad as to be helpful. Experience design I would prefer, except it’s already been subverted and is often stretched to be used as a substitute for traditional information architecture, which is missing the point. So for at least the moment, Service Design is the term du jour.

So what is important about Service Design? What distinguishes it from traditional information architecture? The key points that the definitions I gravitate towards have in common are:

  • Service Design is about designing services, and the experience of using those services.
  • Service Design is user-centered, and wherever possible involves the potential end-users and stakeholders in a co-creative design process.
  • Service Design is multi-disciplinary. It’s not about a singular skill set, like say graphic design. To design successful service experiences takes a combination of business, research, strategy, design, architecture and delivery to make service design.
  • Service Design is multi-channel, multi-platform, and bridges the real and physical worlds. This is another defining characteristic — it’s not just about designing a website user interface, or a single product. It’s about designing an entire holistic experience across all touchpoints.
  • Service Design designs not just self-contained experiences but services that live within internal, partner, and customer ecosystems.
  • The goal of service design is invention, innovation or improvement of services to provide superior experiences for the customers and competitive advantages for the service providers.

Service Design as a concept was born in the 80’s, started getting popular in the mid-2000’s, and is just about ready for it’s time in the spotlight. Next post we’ll explore why it’s important and why it’s one of the next big things.

 

The next generation of digital innovation

In the early days of the digital marketing revolution, digital folk took issue with the ad people’s assumption that campaigns would centre around a TV and print campaign and be simply adapted into videos and banners. Digital was a different medium, an interactive medium, with the ability to create engagement and foster loyalty in a way that TV never could. It’s unique capabilities were woefully underused in matching luggage campaigns, and we fought the good fight for conversation, communities, activation, deep experiences and brand utility.

Things have moved on a long way in terms of our collective understanding of what the role of digital should be, and many of these once hard-fought concepts are now gospel throughout the industry, to the point where digital products, platforms and activation ideas increasingly live at the centre of campaigns.

This is progress is exciting and important. However this is still just a baby step towards the potential that digital technologies can play in achieving our real objectives.

Advertising was never a goal unto itself. Our real role has always been creating competitive advantage for the brand and product through any means available. This has traditionally meant creating differentiation for products and brands through creativity and innovation in how we positioned and told stories around those products and communicated their benefits. At it’s most blunt, it’s meant using reach and frequency to blast familiarity into peoples’ brains with catchy slogans and jingles. And so from this starting point it makes sense that we tend to focus on what we can achieve in digital through the lens of communication alone.

This is much too narrow a view.

The internet is a foundational medium that connects things multi-directionally. It connects people with people, people with companies, people with products and services, services with other services. This connectivity has been affecting our lives like a force of nature, a simple concept like the fractal, which in practice scales to an infinite variety of applications. The result of the digital revolution has in just the last 15 years alone been transformative for how not only businesses operate, but how the world works.

At it’s most dramatic and obvious, it has meant the rise and fall of whole business models, with Blockbuster going bankrupt while Netflix reaches a $15 billion valuation. But digital technologies have given rise to opportunities for disruption or differentiation in the market via all aspects of the value chain:

Business innovation through the value chain v2 pptx 2

Step back and think about this for a minute — the creative and innovative application of digital technologies is literally affecting every aspect of the lifecycle of products and services. Each of those steps in the value chain is an opportunity for creating true differentiation in the product or service that the customer is buying. This isn’t about marketing gimmicks that get the customer to take notice, this is about creating layers of value in and around the product itself, making it something they’d prefer to buy vs the competition.

And as you can see from the examples in the chart above, agencies, marketers and all other functions have a key role to play in envisioning these innovations and making them relevant to consumers, and then breaking the silos down and connecting all of the dots to provide a truly joined up customer experience. This, in our modern digital age, is the future of brand building. It’s a whole new source of competitive advantage, and is what can separate a product in a commodified category or even help create a whole new category altogether. It’s about new business models, new service models, new types of products, new ways of using those products. And it’s something we can all participate in and help drive forward.

WTF is NFC? The brand marketer’s guide to NFC applications

We’re only a few months into 2011, and already there is a new contender for ‘biggest buzzword of the year’: NFC.

NFC stands for ‘Near Field Communication’, and is a variant of RFID, the wireless transfer technology that has enabled everything from travel cards to that seamlessly social Coca-Cola Facebook “Like” wristband. NFC is a super short-range version of RFID that is being natively built into next generation smartphones, and is tipped to be the technology of choice for everything from location check-ins to mobile payments.

It’s been kicking around for years, but in the last few weeks NFC has captured a lot of attention and imagination thanks to a cascade of big announcements. Included in those:

So from a near standing stop, the hardware required for NFC is going to be reaching a critical mass of adoption in short order. The other half of the equation is the infrastructure, and that’s coming into place as well with everyone from Visa, Mastercard, Orange, and Sprint getting behind NFC in a big way in 2011.

All this points to a potential tipping point for NFC, both in consumer awareness and in the availability of the services.

So, what is NFC and can we do with it?

NFC chips are being built into the next generation of the key smartphones as we speak, with some already available, and many more on their way. VentureBeat reports that there will be 35 million NFC-enabled phones by the end of the year, and 1.5 billion within four years. These NFC-enabled phones will then be able to pass data back and forth between both NFC tags and other NFC devices. You can think of NFC tags as cheap and potentially disposable memory chips. You can make millions of them, and they are thin enough to live within a sticker, as Google and Sony have shown. There are a few different types of tags, and some can just send information to devices, others can receive information back and allow two-way exchange.

NFC devices themselves can be implemented with three modes.

The first is called card emulation mode, and allows the mobile to function as credit or debit cards, tickets, hotel keys, etc.

The second is reader mode, with enables the mobile to receive information from NFC tags. So instead of shooting a QR code or establishing a bluetooth connection, you simply swipe your mobile across the tag and receive the associated content.

Lastly there’s P2P mode, which allows NFC devices to pass information back and forth. This would allow two mobile devices to exchange information like the Bump iPhone app, but it would allow it across different devices (e.g., a Blackberry and an iPhone) as the communication method is standardized via NFC.

What can we do with NFC?

  • Mobile payments
    Mobile payments are the killer app for NFC, and the key reason that everyone from financial giants to carriers to phone manufacturers are jumping on the bandwagon. NFC has a built-in ‘card emulation mode’ that allows it to act as a mobile wallet, allowing customers to simply swipe their phone over anything from a vending machine to a card reader in Starbucks to make a payment. The very short frequency range helps ensure security, and it’s possible that purchases under say $15 will not require an authorization, and anything over that may require a security code to be entered.
  • Ticketing and hotel keys
    The card emulation mode also allows the NFC device to serve as a substitute for event tickets, loyalty cards, or even hotel keys. So at reception when you check in you’d swipe once to pick up your key, and then swipe again over your room door to unlock it. No key to remember as long as you have your phone with you.
  • Location check-ins
    Leading Japanese social network Mixi has already introduced NFC-based location check-ins via Android, allowing users to check-in instantly by swiping their phones against an NFC decal at a physical location, meaning your check-in is physically verified, can work in places that GPS signals don’t reach (like underground), and you’re saved the step of tracking down the location you need to check in to.
  • Enhancing a physical experience
    At the PIAS music festival, 10,000 people received cards with an NFC chip embedded in them, enabling a whole range of enhanced experiences from photo sharing to connecting people at the event to entering contests. A similar experience was provided at the STRP art festival in Holland, where RFID tags were used to connect people with the art.
  • Object-based media
    Physical products are increasingly coming with sensors and wifi connections, allowing them to gather and share data. But an even simpler and more ubiquitous form of ‘connecting’ objects is available with NFC, allowing objects to be very cheaply include NFC tags that will allow them to bundle in media and simple interactivity. Timo Arnall’s great post on iPhone RFID: object-based media includes a video that brings this concept to life.
  • Smart posters
    A use case that has been talked about for years, smart posters would include NFC tags that store anything from media to URLs, and have those seamlessly transfer to the users’ phones when swiped across the poster.
  • Phone-to-phone information exchange
    One of the standard NFC features is the ability to exchange information between two NFC devices. This will allow functionality like the ‘Bump’ app on iPhones to work across different and competing devices.

With all these different use cases about to start rolling out NFC should end up becoming indispensable and ubiquitous, and the idea of phone swiping is going to take hold quickly, acting as a universal command for interacting with the world, exchanging data back and forth to enable a more seamless experience wherever you go.

Why would I use NFC instead of Bluetooth, QR codes, or traditional RFID?

From a marketers’ perspective, one of the key questions is how NFC differs between RFID, Bluetooth, QR codes, and other technologies that have traditionally performed some of the functions listed below.

Bluetooth

Bluetooth is a familiar technology for many marketers, having a lot of potential for distributing multimedia content and alerts from set locations, such as retail destinations or events. Bluetooth actually has a number of advantages over NFC — it transfers data faster, has a much larger range, and one Bluetooth station can connect with many devices at once. It’s essentially a local broadcast system.

NFC has one major advantage over Bluetooth, which is speed of connection. Bluetooth takes several seconds to establish a connection, while NFC connections are instantaneous. NFC having a much shorter transmission range actually has advantages in security as well, as it makes it much less likely for a transaction to be intercepted.

Interestingly one of the expected use cases for NFC is to accelerate the process of connecting two Bluetooth devices, using NFC to make the connection and then Bluetooth to transfer the with its faster transfer rate. So in some cases the technologies could be complementary with each other.

QR codes

QR codes are easy to create, instantly recognizable, virtually cost free, and fast to access.

However NFC is near instant and a much more seamless experience than QR codes. With QR codes you need to load up a QR reader app, take the photo, wait for it to be transcribed. With NFC you’ll just swipe your phone. The ease of the experience means it’s much more likely for someone to actually do it. And increasingly with phones building NFC natively into the chipset, you won’t need to download a reader app like you do with QR codes, making it more broadly accessible.

The other case where QR codes do have an advantage is distance. With NFC, you need to be inches away from the tag — literally, you swipe your phone across it. QR can be placed on billboards or buildings where you wouldn’t be able to physically reach with your phone.

RFID

Traditional RFID has a longer signal range, but is less secure mainly for that reason. NFC chips are also being built directly into phones, which will make the development of NFC apps much simpler and more robust, and it should be much more seamless to use.

GPS

Right now location-based check-in services such as Foursquare and Facebook Places are based on GPS, which uses satellite positioning technology to figure out roughly where you are and offer a choice of places to check in. Google’s Recommended Places service is using NFC to shortcut that whole process, embedding NFC chips in the “Recommended on Google Places” stickers that are places on businesses’ doors, signs or windows. Customers could simply swipe their phone over the sticker as they are walking by, and presto, they are checked in. No loading an app, no waiting for the GPS, no searching for the place you’re in.

Summary

As we’ve seen with promising technologies like augmented reality, we always need to be careful about overhyping new technologies before they are ready for prime time. However NFC is not a technology waiting for a use case. It has immediate real-world applications, and will be a measurable step forward in seamless commerce transactions and brand experiences for a mass audience. It seems like an obvious winner from a use case scenario, and the ’swipe’ or ‘tap’ will become a key way that we interact with our connected world.

The question mark with something like NFC is always around infrastructure and device adoption, but with so much benefit to be reaped and all the players coming on board, it looks like it will be ubiquitous in a hurry. In fact there’s so much of a rush into the market, the main questionmark seems to be around format fragmentation, whether the mobile payment options from all the various players will be inter-compatible or if we have a Mastercard vs Visa or VHS vs Beta format war looming.

Either way, it’s exciting to see a technology as powerful like this coming onto the horizon, and looking forward to seeing both the big plays by infrastructure giants like Google and Visa, as well as the innovative brand experiences pioneered by any brand looking to provide a more seamless and social experience for their audiences.

 

 

 

Supercollider | 2011 Trends

I’ve never done one of the semi-mandatory annual trends prediction posts that greet every new year, and had no plans to start now. Which is probably a good thing, considering it’s now February already. But I thought it might still be useful to highlight the conceptual areas that I think hold the most promise for continuing exploration, innovation and creativity in 2011. I thought it would help me frame up the year, and if nothing else serve as a useful snapshot in time about what I’m excited about. And there is a lot to be excited about.

Macro trends

Marketing as value creation

“Brand Utility”. “Cause marketing”. “Purpose-driven brands”. “Brand experience”. “Marketing as a service”.
The overall macro trend in our industry is the continuing shift away from advertising as annoyance and pollution, and towards marketing as value.

We see this driving many of the other opportunity spaces below, providing marketing that is contextual and personalized. Creating original content, contributing to culture, involving fans in the brand and the product, better understanding and valuing the customer lifecycle, and standing for something and contributing something back to the world. All of these are focused on how to make marketing better, gaining competitive advantage for brands by making better, more useful and awesome things for their customers.

As our world becomes more transparent and filters become better and better, it’s crucial that marketers continue to find ways to evolve marketing from interruption to value, and we’re making significant progress every year.

Holistic product marketing and brand experience

In the past, the cycle for many products was R&D > Product Development > Advertising > Consumption. This is changing in important ways:

  • There’s now a two-way link from consumers back to marketing, R&D and product development.
  • Greater transparency in product and service quality through social reviews and buzz is increasing the importance of product and service quality and differentiation, and authentic brand positioning and building.
  • We’re all focusing less on “advertising” and more on finding relevant ways to express product value.
  • The big communications idea for a product or service, and what a brand stands for, needs to be baked in up front into the product or service creation, and every touchpoint of the brand needs to reflect this.
  • The line between “feature” and “marketing” is blurring in the digital world. Is ecoDrive a feature or a marketing campaign? Both.
  • Even customer service can function as a powerful marketing tool — see Zappos, as well as the multitude of brands experimenting with Twitter-powered support.

Marketers are recognising that in order to win, they need to look at the whole customer experience in totality. Agencies’ roles then need to shift with that, to be able to come up with a shared vision for that that whole journey, and to be able to join up the dots.

CRM 2.0 / The evolution of loyalty and service

CRM has long been shorthand for badly maintained email databases that get messaged every now and then. Outside industry leaders such as Tesco’s it’s often seen as important and necessary, but not that sexy — advertising’s ugly but well-connected cousin.

But the nature of CRM is fundamentally changing in the digital age, and all of a sudden it’s becoming exciting. If it helps, drop the acronym and just think about it as Customer Relationships.

What’s changed?

  • Via social spaces such as Facebook and Twitter, brands now have active communities and the ability to easily reach and interact with them.
  • Facebook has profiling data the average CRM manager could only have dreamed about.
  • Customers are generating more and more data points about their behaviours with companies and products via connected products and digital services.
  • With mobile apps and mobile websites, brands can be with their customers wherever they go, and even know where they are.

What does this allow?

  • Zero or low-cost interaction with millions of active consumers and brand fans.
  • The permission and means for low-touch, frequent contact.
  • Real-time responsiveness. No more “write an email, design it, build it, QA it”. Now it’s “type something into the status bar, press send”.
  • Contextual, location-based, and personalized messaging. The more you know about your customers, the better you can tailor your communications to them.

What are the implications?

  • More long-term programmes. If you have long-term relationships, you can build things to get people involved over the long-term, encouraging deeper engagement. You also need these programmes to serve as the engine of your social channel content streams.
  • Better customer insights. We’re not there yet, but we should be able to start connecting more of the dots in behaviour and chatter to understand our consumers, what they like, what they are doing, and what’s on the horizon.
  • Greater focus on customer participation. It’s a missed opportunity if you gather all these people together and then just hit them with broadcast messaging. The question is what do you actually do with all these people.
  • A return to high-touch customer service. This is going to be a big issue the next few years. Companies have spent years optimizing their customer service to be as efficient and automated as possible, massively reducing costs in the process. Now customers are expecting that they be able to get responses to their issues via the same social channels they already have “relationships” with brands. And some brands like Delta are starting to oblige. Is this scalable, and sustainable? Do brands have a choice?

Standing for something

In 2010 brands like Pepsi and Levi’s made big splashes with campaigns centred around brand statements that both reflected a constructive view of the world, but also supported and actively participated in furthering that point of view.

For Pepsi, the Refresh Everything campaign was about optimism and riding the wave of positive change surrounding Obama’s election. They activated the campaign with the Refresh Project, which took the $20m they would’ve spent on the superbowl and distributed it through a CSR initiative that drove micro-grants into community initiatives, with both the idea submission and selection being crowdsourced.

Levi’s “Ready to Work” both featured the challenges of the small town of Braddock, Pennsylvania, and supported the town’s young mayor in helping him overcome them and reach his goals of repopulating and redeveloping the town.

Where a few brands like Patagonia have always had a meaningful brand idea at their core, many other have sufficed with running adjunct CSR projects to greenwash their images. But for many reasons including the financial meltdown, increasing concern about global issues, and the increasing awareness and transparency around corporate practices, and consumer’s changing relationship with brands and marketing, we’ll be seeing more successful brands not only stake out a meaningful brand position, but actively bring that position to life and help make it real.

Evolving business models for the digital age

Newspapers. Record labels. Travel agents. Yellow pages. Video rentals. Film processors. Bookstores. Encyclopedias.

The common thread in the above businesses is that they have seen their traditional business models become obsolete or fundamentally change before their eyes as a result of new models based on digital technology.

Many other industries and business models will be facing this opportunity and challenge in the coming years. Even for those industries who are not under immediate threat, digital technologies and the connections and features they enable can give businesses a competitive advantage and can open up new product and service lines.

Kraft is selling iPhone appsDisney is producing densely populated and money-making virtual worldsMTV have moved beyond music broadcast into music creation with Rock BandMLB is making $500m+ a year from it’s web and mobile operations through MLB Advanced Media.

We all need to be looking at digital not just as a communications tool, or an advertising tool, or even a marketing tool. It’s becoming fundamentally intertwined with our products and services, and may show the way towards the future of what our companies can become.

Tactics and enablers

Owned and earned media

We’re already seeing a big shift in media towards looking at “Paid, Earned, Owned” media models. The emphasis on earned and owned media is only going to accelerate. More brands will treat their Facebook pages as Red Bull do, as a primary means of reaching their consumer.

Cultural integration

The two trends of ‘Standing for Something’ and ‘Marketing as Value Creation’ can combine to form many powerful combinations and expressions. Brands integrating into and supporting culture is one of the most potent. Branded entertainment, colabs, brand patronage and cultural activation and experiences are continuing to evolve and expand as brands find new ways to play a meaningful role in people’s lives.

To help provide true authentic grounding to their brand proposition and their “What we stand for” statement, many brands won’t be content to just sponsor. Like Red Bull they will look to roll their own, helping push sport forward with Red Bull Project X and supporting the arts with Red Bull Music Academy. Or like Intel they will serve as partners and patrons for deep and long-term initiatives like the Creators Project they created with VICE. It’s not enough to just badge something these days — brands need to have some skin in the game.

Service design

Service Design is a burgeoning discipline, defined in Wikipedia as “the activity of planning and organizing people, infrastructure, communication and material components of a service, in order to improve its quality, the interaction between service provider and customers and the customer’s experience.”

What a brand means and stands for consumers is ultimately formed in their minds from every impression they have of that brand. Every touchpoint counts. And service design can have a big role to play in making sure those touchpoints are all designed to work in harmony in service of the best possible customer experience.

As an example, it’s one thing to design a campaign for frequent flyers espousing the VIP experience you get and the benefits of your customer relationship. It’s another and much more meaningful thing to deliver a next generation check-in experience using RFID that also serves as a major fulfilment and expression of the brand promise. That’s how Qantas has used service design, to ensure it’s customer experience is paying off on their brand promise.

Real-time marketing, reactivity

It was interesting to see in JWT’s 100 Things in 2011 deck the idea of “Fashion Fast-Forward”. Their prediction is as fast-fashion retailers like Zara have shoppers expecting constant turnover, and “with consumers increasingly living Life in Real-Time”, that fashion’s seasonal-based model will begin to lose relevance and labels will introduce new looks on an accelerated timetable.

What is true in the retail and brick and mortar world is even more true in the world of ideas, memes, content and communication. As we talked about in The Real-Time Brand, the expectations, demands, and opportunities for brand communication is fundamentally shifting. Campaigns will always be important to make big statements and create saturation, but the leg work for brands is done day-in and day-out, through a never-ending stream of content, communication and experiences. We’re now in direct regular communication with our fans and customers, and that means a very different approach.

Location based services and marketing

Location is going to be on everyone’s lists and radar this year, and for good reason. The point is less which technology or platform wins. It’s more about focusing on what location enables.

Location enables us to be more relevant, more contextual with our messages and services. We can reward and acknowledge customers for physical experiences, to highlight them of information or deals around them, to know where they are and talk to them accordingly. It means marketing that is more valuable, more timely, more relevant.

StickyBits recently shifted from a general content model to one focused on deals, reflecting the pervasiveness of incentives. Knowing rewards and VIP access are the number one reason people friend brands, it seems like it makes sense that this will at least for the foreseeable future remain the main thing we use location to talk to consumers about. But as the Museum of London’s StreetMuseum app has shown, there are going to be services and content that trusted brands can create to provide value in other ways as well.

Proximity

“I told the media you can’t make up lies about me because I have a media outlet myself. Oh and sidebar I don’t know if everyone has realized this yet but I don’t do interviews if there’s anything I wanna say I’ll say right here on my own blog.” kanYe West : Blog

Whether it’s patients to doctors, fans to celebrities and athletes, or businesses to consumers, the internet is bringing us closer and bridging the gap between people. In the process, it is changing how we communicate and opening up new opportunities for connection, collaboration and conversation.

Advertisers like Old Spice and Comparethemarket.com and a legion of TV shows such as Eureka brought people closer to characters, while real celebs like Wayne Rooney played FIFA against his fans and others brought fans the unvarnished truth and used Twitter to break news first, and Imogen Heap has pioneered co-creation with her fans, bringing them closer than ever before into the artistic process.

Storytelling 2.0 / Transmedia

From Gatorade REPLAYRed Bull Project XCoke’s The Secret is Out TherePenguin We Tell StoriesThe Hidden Park, and True Blood, over the last few years we ‘re seeing lots of different ways of brands and content creators experimenting with storytelling. From fragmenting them across media to provide depth, to immersing users in the stories as active participants, to staging something that changes or influences culture. The opportunity for innovation in storytelling is huge.

Internet of things, connected products, physical/digital

Our products are now able to talk to each other, to other people, to the world. To update themselves, refresh, learn new things. Our things are now aware of their environment, what they are doing, can communicate and interact.
From a marketing perspective, it’s looking beyond Nike+ to LiveStrong’s Bike with a Brain, the WineM smart wine rack that uses RFID to cast information shadows, to understanding where in the city is hopping tonight, to RFID enabled Disney toys, which exist both in the digital and physical worlds, to stethoscopes connected to your iPhones and glucose meter games.
With the internet becoming ubiquitous, and everything becoming connected, the question of “what can all my connected products?” is going to be a huge one for product designers and marketers over the coming years.
Another important development in this space is the heavily rumoured inclusion of NFC technology in the iPhone 5, which would open it up to easy and seamless data transfer between any number of connected products and devices.

Personal informatics

We’ve always been fascinated with our own reflections. But these days we have a whole new way to look at ourselves. Through the unblinking eye of connected products which passively collect data on our biology and behaviour, and supplemented through personal data trackers, we’re able to aggregate a true view of ourselves through many discrete data points.
It’s now easy to track your runs with Nike+, your finance with Mint.com, your driving with Fiat EcoDrive, your energy consumption with Wattson, your weight with Withings, your sleep with FitBit, and even the health of your heart. Anything that you can’t track automatically you can input into the ever flexible Daytum.
It’s still an early adopter phenomenon, but both people and the broader media are increasingly becoming aware and interested in the concept of Personal Informatics, and with tracking technology fast becoming ubiquitous and consumer expectations being raised, expect more brands to jump on the bandwagon.

Branded API’s and services

One of my favourite presentations of the year was Tom Coates ‘Native to a Web of Data’. In it he does a great job of illustrating how the web is fundamentally shifting from a collection of siloed destinations to an aggregation of connected data sources and services. From Tesco’s to MTVLonely Planet to Best Buy and FlyBe, big brands are are realizing the benefits of opening up their data pipelines to the world.

Crowdsourcing and co-creation

For many brands, the big question with social spaces is “what do we do with all these people?”. Streams of exclusive content, deals, and other items to make them feel VIP is the expectation from the majority who’ve ‘liked’ a brand. But the possibility still exists for doing something interesting with that big mass of people.
Much of the press on crowdsourcing is focused on the most banal example of this in terms of companies like GE essentially participating in large scale spec work competitions. Which is a potentially valid and important example of harnessing collective creativity, but for me still missing the bigger point.
Crowdsourcing is a hugely powerful concept which speaks to the most fundamental promise of the web, the idea of this network providing an immediate and tangible connection between a brand and their consumers/fans, and the ability to harness this audience to help positively shape the brand. Dell Ideastorm and Starbucks My Idea are the obvious examples, but lots of brands and individuals are experimenting with this concept in different ways, from the amazing idea of crowdsourcing a Johnny Cash video by sourcing 250,000 individual painted frames through to Mountain Dew crowdsourcing an entire beverage, from the flavour through the name through to what media they use to promote it, and to Muji hosting a massive design competition that nets out with products in retail stores. The scale and ubiquity of Facebook fan pages make this even more powerful and accesible to brands. It’s an exciting concept that will just keep growing in potential.

Social activation

If crowdsourcing is about getting the crowd to contribute something, social activation is about getting the crowd to do something, with a digital experience often serving as the hub of a physical event or activity.
The Nike+ Human Race got the world running, NIke’s The Chance gave 75,000 kids the chance to go through Football trials, and Cadbury’s Spots vs Stripes campaign aims to get the whole world playing games for the Olympics.
Don’t get me wrong, activation is hard. But it can be hugely rewarding and powerful, and with social channels it’s never been easier to pull off.

Gaming

Gaming is exploding, with social gaming leading the way. Just in the last few months CityVille implausibly reached 100 million active gamers in just over a month of launchingCall of Duty: Black Ops staged the biggest entertainment launch ever, and Kinect smashed all sales expectations for sales as it took the body-as-controller revolution Wii Fit began to a whole other level.

Over the last few years we’ve seen some brand innovation in the space, from VW launching their new GTI solely via an iPhone game, to huge ARG’s from Microsoft and McDonald’s, great Facebook promotional games like Parking Wars, and Burger King developing their own lo-fi Xbox games. It’s not an easy space for brands to break in, but as gaming continues to elevate within culture as a dominant and pervasive form of expression and entertainment it will be imperative that brands figure out how to contribute in a meaningful way.

Social commerce

Social commerce is an exploding, multi-facted beast. You’ve got brands like Disney and Delta porting or syndicating their online commerce experiences to social spaces, allowing fans to discover and purchase without ever having to visit a destination site. Then you’ve Levi’s creating a Facebook like powered store called Friends Store within Levis.com. You’ve got Google-spurned Groupon aggregating the crowd for group buying discounts. And you’ve even got Diesel taking social media to the dressing room with Diesel Cam. Whether it’s allowing user’s to create their own stores or affiliate links, gaining recommendations on what your friends bought, asking for advice while shopping, or simply broadcasting your latest purchases, shopping is becoming more social.

Still want more?

Here’s a collection of other 2011 trends and prediction posts that are definitely worth a look:

It’s setting up to be a big and potentially transformational year in the marketing and digital spaces, and I’m looking forward to some amazing work being produced in 2011 off the back of these trends and opportunity spaces, as well as some we’ve not even imagined yet.

What trends and opportunity spaces are you most excited about? What ones have I missed that you think deserve to be on the list?

The Real-Time Brand

VMA Data Visualization

Brand communication to the masses used to be an expensive proposition. It involved painstakingly producing assets, buying media, and long leads times.

Campaigns will always be with us, but now most brands have their own media channels as well, many with millions of opt-in subscribers. We can access all those people at a touch of a button.

This is an amazing, and unprecedented thing. But with that power comes changed expectations. Social is an immediate, and human medium. The expectation is a conversation, which means immediate reaction, real-time discourse, and timely topic starters. It means being of the moment.

Gatorade Control Center

Gatorade has a created a dedicated control center where they can listen to their audience, see trends and conversation spikes, and respond in real-time.

Comcast Cares Radian6

It might seem like PR, but it works. Comcast’s pioneering twitter customer service uses a custom Radian6 setup, allowing them to respond within minutes to customer gripes or questions.

McLaren Real Time Data Stream

McLaren have automated their real-time communication. The F1 constructor live streams data to the website during F1 races and tests, including live stats and real-time commentary between the car and the pit.

Baker Tweet

BakerTweet allows Albion Bakery to send out immediate updates to fans when their breads are fresh out of the oven, just by a flick of a switch.

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The real-time extension of Old Spice’s “The Man Your Man Could Smell Like” campaign delivered on-the-fly episodic content, scripting, producing and distributing 87 short videos in 11 hours, all in response to live commentary on Twitter.

Cultural relevance and relevance to the consumer’s needs is increasingly defined in minutes and days, not weeks or months. Increasingly brands need to be participating in 24/7, 365 conversation, and campaigns themselves need to become more agile and responsive. This is giving birth to the “real-time brand”, which is a fundamentally different way of thinking about and delivering marketing conversations.

Here’s a few initial guidelines for the Real-Time Brand:

  • Create your listening post
    The internet is filled with millions if not billions of conversations daily. You need a way of honing in on what is most relevant in order to be able to meaningfully participate. Technology solutions such as Radian6 and Visible Technologies are a good place to start.

  • Find your voice
    Be ready to react in the moment with your brand’s POV. This includes ensuring the people who are charged with manning the listening posts and social presence are able to and authorized to respond in real time, and can do so in a voice that represents the brand.

  • Shift from campaigns to content streams
    Real-time brands have a steady stream of original content humming out on their social channels. Start by creating a conversational calendar and leave room for experimentation. The cost of creative failure is much lower, so try things, weed out the weak performers and amplify the rest.

  • Treat campaigns as living things
    Rather than fire and forget, ensure your campaign budget allows for responses and reactivity, and leave room for your audience to get involved with them.

  • Automate to reduce information latency
    As McLaren’s live commentary stream and BakerTweet show, real-time communication from brands doesn’t always need to come from people. Relevant and true real-time messaging can also come from connected products or automated triggers, cutting the information latency down to next to nil.

  • Invest
    The resources required to support an ongoing conversation should be allocated separately to the traditional campaign budget, as the depth and on-going support required is a completely different model. Best Buy have tried empowering their entire workforce (to mixed results), while Dell’s success is built around a dedicated 45 person team. This isn’t somebody’s part time job, it’s a whole new way of bringing the brand to life.

    Also worth considering is taking a page out of Red Bull’s book. They have inverted the traditional media model, investing as much as 90% in execution vs 10% in media. They produce great events and content, and then leverage earned media and PR get it in front of millions of people.

The shift we’re seeing is just beginning, even if it’s fast becoming an imperative. If you have any other principles or great examples of the real-time brand I’d love to hear them in the comments.

Inbound physical/digital: the audience takes control

In the sphere of physical/digital interaction, the bulk of the attention is going to “outbound” communication from objects. For example, Nike+, EcoDrive, and BakerTweet. This is all about objects generating data and communicating it back with their owners or other interested parties.

The other area to explore is “inbound” communication to objects, controlling them and changing their behaviour via digital channels.

The most celebrated example of this is Nike’s LIVESTRONG Chalkbot. Chalkbot took tweets as input, and used those to write chalk messages of support in the path of Tour de France riders, allowing fans to remotely participate in this inspiring tradition.

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Livestrong is a great example of a brand supporting their marketing efforts by allowing people to remotely control and input into physical devices. Here’s a collection of other examples of this idea in action:

Halo “Remember Reach”

For the launch of the latest instalment of the lauded gaming franchise Halo, Microsoft and its partners constructed a “54,000 points of light” tribute to the fallen heroes of the Halo Reach battle. Fans can use a pick a point of light on the matrix, and then watch as a giant robotic arm plots that point onto the light sculpture, helping reveal the final form.

Video_ Giant Robot Arm Powers Innovative Halo_ Reach Light Sculpture | GameLife | Wired.com.jpg

Heinz “Talk to the Plant”

Described as an “Interactive Ketchup Growing Experiment”, Heinz’s Talk to the Plant campaign took the slightly-dubious insight that 75% of people talk to their plants, and decided to see whether they could prove that a little vocal encouragement goes a long way for our green friends.

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Plant lovers could peck out a message on the Heinz microsite, selected a voice to use, and then listen as it was played for the lucky plant. A control plant received no such support, and in the end of the six week experiment it was 7% shorter, proving the campaign proposition that Heinz can grow tomatoes like no other.

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Absolut Machines: Absolut Choir

Part of Absolut’s brilliant 2008 Absolut Machines exploration of the intersection of technology and creativity in art and music, Absolut Choir is a “multi-channel robotic choir” created by Swedish studio Teenage Engineering.

The installation consisted of 10 wooden characters ranging in size from four inches to nearly eight feet tall, each with a unique synthetically produced voice ranging from tenor to soprano. The characters also contained an embedded Linux device allowing them to be controlled and fed sound instructions by a master server character.

The master character was then connected with the world via www.absolut.com/absolutmachines. Online users from around the world were able to input words to the machine, which the choir would automatically absorb into the composition, generating new melodies, tempos and lyrics, taking on a “mood” from the tone and content of the user’s input.

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BBC Blast

Named as the 2010 Webby’s People’s Voice Award for best NetArt, BBC’s Blast Studio
interactive art installation put the tools of creativity into thousands of young people’s hands, allowing them to create a collaborative piece of art over the internet in a brilliantly simple and fun way.

From controlling a robot to blast paint against a wall, triggering AV sequences using hanging strip lights, and inputting into automatic typewriters, visitors to the Blast Studio microsite had a chance to contribute and explore their creativity in real-time, directly evolving the installation in London’s Southbank Centre.

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Sony Hopper Invasion: #Pumpt

For their Spark Something campaign in the UK, Sony experimented with the idea of an event combined with real-time visualization. Using a combination of Twitter and Arduino, for every #Pumpt tweet that was received one of 49 Space Hopper balloons would automatically inflate for 10 seconds.

EA Battlefield Bad Company 2

To promote the launch of Battlefield Bad Company 2, EA went as far as to create an actual battlefield. Built at 1/10th scale and residing at a local cinemaplex, users could use a Flash interface to remotely roam the terrain with one of four webcam-enabled tanks, and blast the enemy tanks controlled by other virtual opponents using a laser LED cannon.

The virtual generals who scored the most points climbed a leaderboard and ultimately took home the spoils of victory, including free copies of the game.

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Foster’s Scuba

Foster’s Scuba is a product innovation that helps control the size of bubbles in the beer, leading to a smoother drinking experience.

To create some buzz around the in-can widget, Foster’s created Ride the Scuba, a competition to seek and destroy bubbles in a 100,000 litre tank of amber coloured nectar. Using a scuba robot remote controlled via the internet, competitors had two minutes to blast away bubbles in the tank, broadcast live from the National Marine Aquarium in Plymouth, UK.

Playground Stores / Sleepless

Playground Stores in Sweden wanted to sell more of its hiking and outdoor lifestyle products. Drawing from the insight that hiking makes people healthier and more alert, their agency Akestam Holst came up with the idea to have a competition for four hiking enthusiasts to stay awake the longest, and sell products while doing so. To raise the stakes, customers who bought products from the winning competitor would be fully refunded their money to making a successful bet.

Sleepless was a great example of outbound physical/digital integration. Not only was the event live-streamed, competitors had heart rate monitors and pedometers which broadcast their real-time activity back to the web.

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There was also a really smart bit of inbound connection as well. where when users saw their chosen competitor starting to nod off, they could prod them back to life or send a message of support via a Tweet or SMS. Pretty low-fi compared to the other examples, but very nicely integrated into the overall concept and experience.

Imogen Heap TwitDress

Singer/songwriter Imogen Heap has long been a pioneer in the online space, using social tools such as Twitter to involve her fans in every aspect of her creative process and create a uniquely close relationship with them.

So when it came time for her to accept an award at the 52nd Annual Grammy Awards, she invented a way for her fans to accompany her on stage. Creating a piece of fashion called the TwitDress, Imogen’s dress collar featured a set of LED’s that were able to display TwitPics featuring hashtag #twitdress in real-time.

Grammys_ Imogen Heap Accepts Award Wearing _Twitter Dress_.jpg

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Skoda Octavia Remote Control

In an idea that amazingly got past the legal department, Skoda in Amsterdam gave people remote-control of a real car via the internet. Presumably in a pedestrian and vehicle free environment, people could choose to watch the live stream, or get involved and take it for a drive themselves.

Adverblog_ Skoda Octavia Remote Control.jpg

Summary

The trend of brands experimenting with inbound physical/digital and connecting internet users directly with physical objects kicked off in earnest back in 2008 with the Cannes silver lion winning Heinz “Talk to the Plant”, the Absolut Choir, and Foster’s Ride the Scuba. Since then we’ve seen a wave of further innovations, notably the use of tools such as Twitter to make the input process even more seamless and social.

The best examples to date tick both the boxes of “PR stunt” and “audience engagement”, and the success metrics on quoted on both counts are impressive.

As more and more brands look for innovative and effective ways of engaging and activating their audiences, the idea of allowing those users to interact and collaborate in a shared physical space from the comfort and convenience of their own homes is ripe for further exploration and invention.

If you have any other great examples of inbound physical/digital connections in action, or thought on the future of the space, I’d love to hear them in the comments.

Six features of connected products

In terms of game-changing opportunities for marketing and product development in our time, there are few bigger than products that come out of the box digitally enabled.

What happens when everything from your car to a Barbie are designed as sensory devices, connected to the world, with built-in communication channels? What happens when all our products live and breath data, drawing it in and feeding it back out?

This isn’t science fiction, it’s happening right now. And after looking at a few examples of innovators in this space, I think it might be possible to identify six features sets that will be core to the wave of digital product innovation we can expect over the coming years:

  • BUNDLED - Unlocking exclusive digital experiences.
  • SENSITIVE - Collecting and interpreting data.
  • TALKATIVE - Sharing and broadcasting.
  • RESPONSIVE - Responsive to the world.
  • UNIQUE - Personalized to you, and evolves over time based on customer interaction with product.
  • PLATFORMS - Platforms not products.

Although you’ll see many products implement multiple features from this set, some focus on just one.

Bundled

The concept of bundling is simple: offer digital content and experiences exclusively to product owners, as a selling point for the product itself. This can be even more powerful when that access is provided on top of something already being used. i.e. imagine if you bought an MP3 player and it unlocked an exclusive Facebook music feature, only available to owners of that particular device.

Kids are natural born early adopters, and the competition for their attention is fierce, so it’s no surprise to see some of the leading edge examples of bundled digital experiences exist in toys marketed to tots barely out of diapers.

For example, Disney’s Clickables product range is designed to connect directly Disney’s Pixie Hollow virtual world, home to 25 million avatars created by young fans. Collectable physical charms and toys unlock special items and features in the Pixie Hollow world. And if you bump bracelets with your friend in the real world, your avatars automatically become friends in the Pixie Hollow virtual world.

This is obviously an very cool innovation in itself, but what’s possibly more important is that kids are going to grow up thinking its natural that if they bump their toys together, things will happen in a digital space. That’s a revolutionary shift in thought, the expectation that physical objects have a digital life beyond, and the two are inseparably connected.

All about Clickables | Pixie Hollow | Disney Fairies.jpg

Disney is not the only one with this idea. In fact, Webkinz, Barbie Girl MP3 Players, Build-A-Bear, and even the hugely popular Beanie Bears are all featuring unlockable bundled virtual worlds as a key feature of their physical products.

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Not to be outdone, McDonald’s has one of the most innovative bundling strategies I’ve seen yet. They launched their McWorld virtual world back in 2008, which looks like this:

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For McDonald’s, digital bundling is now integral to their hugely popular Happy Meals. When you buy Happy Meals now, kids don’t just get a toy, they get a unique code. That code unlocks exclusive content in the McWorld virtual world. For example, Star Wars Happy Meals include a Jedi toy, but they also include a code that unlocks an exclusive lightsaber feature within the Darth Vader quest on Happymeal.com.

Not content to stop there, the codes McDonald’s are bundling often unlock limited edition content on partner sites as well as their own. Recent promotions have seen codes unlocking content on the Build-A-Bear site, Beanie Bear’s BeanieLand, and even the LEGO Batman Xbox 360 game. McDonald’s recognized that while building membership in their virtual world could pay off long-term, it’s also important to “fish where the fish are” and ensure they are providing kids with exclusive content on other hugely popular destinations worlds.

Sensitive

No, sensitive products aren’t easily offended. Rather, many connected products are equipped with various sensors and inputs in order to collect and interpret data about you, about itself, and about it’s environment.

Nike+ enabled shoes gather data via an accelerometer.

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Botanicalls uses moisture sensors to interpret the condition of the plant’s soil.

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FedEx Senseaware gathers temperature, light, and location data.

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All these products are geared to sense and aggregate in order to deliver their added value functions.

Talkative

For those products that are sensitive, their next key feature is to communicate:

To you
Botanicalls will give you a call or a Tweet when it needs to be watered.

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To a community
The Withings WiFi scale can be set to communicate weigh-ins to friends on Twitter, for a bit of public peer-pressure.

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EcoDrive and Nike+ stats aggregate to help show you how your community is performing and to allow you to participate in challenges.

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Broadcast
Occasionally, products can even broadcast information to public space.

For example, RFID reader displays in retail stores are now able to identify products that have been selected and dynamically display information about them.

Or for another well known example, Mini used RFID to power this dynamic outdoor display.

First-ever Talking Billboards Revealed to Mini Motorists | Design News.jpg

Responsive

Connected products can also be responsive to the world, updating themselves based on content generated by people or by real world events.

The form of players in EA’s FIFA 10 Live Season videogame change dynamically based on the actions of those same players in the real world. If Cesc Fabregas is having a blinding season for Arsenal, he’ll be that much stronger in the game as well.

FIFA10_X360_Ligue1LiveSeason_006_619x346.jpg (619×346).jpg

Or showing how products could update based on content generated externally, the collar on the dress worn by Imogen Heap at the Grammy awards displayed a real-time feed of tweets addressed to her.

Grammys_ Imogen Heap Accepts Award Wearing _Twitter Dress_.jpg

Unique

I haven’t seen many examples of this, but it’s a natural next step. As products begin to capture location and activity data, gathering data on how they are used and who you are as the user, as well as the context and environment they are being used in, they can begin to personalize themselves to you, automatically adapting and optimizing themselves.

For example, Intel Labs is developing a new smart TV remote. It aims to recognize who’s holding the remote based on idiosyncracies of their hand motion (yes, seriously) and then once identified, automatically serves up personalized content and menus.

Google Chrome.jpg

Platforms

If your product deals in data, it’s possible to expose that data to the world, allowing other people to build things on top of it, creating additional value for your business and your customers on your behalf.

For example, Ford SYNC AppLink is connecting the car’s in-dash system with 3rd party application platforms, including Google’s Android. This means Android developers will be able to develop apps that run inside the car. It’s not a stretch to assume those Android apps built specifically for AppLink could hook into a Ford SYNC Applink API, drawing data directly from the car in real-time, including driving behaviour and geo-location. The car is built as a platform, not just a product.

Other brilliant examples come from the iPhone and Nintendo DS.

iStetho uses a special adapter for your iPhone plus an iTunes app to turn stethoscope input into visualizations that could be viewed, stored and analyzed.

Video_ iStetho Turns your iPhone into a Stethoscope-1.jpg

Bayer Didget is a blood glucose reader designed for diabetic children instead of their parents. It works as a fully functioning reader device on its own, but it also plugs directly into the Nintendo DS, converting test results into reward points that allow kids to unlock items, levels and mini-games within a DS adventure game called Knock ‘Em Down.

Bayer Drops in with Didget Blood Glucose Monitoring System for Nintendo DS | Game Guru.jpg

Yes, the DS and iPhone are by definition platforms. But I think there’s something in the idea that any physical product that takes in or creates digital input can be built with platform principles in mind, creating many future extension opportunities that the original designers may never have envisioned.

Summary

So, the six opportunity spaces for connected products I’ve spotted so far include:

  • BUNDLED - Unlocking exclusive digital experiences.
  • SENSITIVE - Collecting and interpreting data.
  • TALKATIVE - Sharing and broadcasting.
  • RESPONSIVE - Responsive to the world.
  • UNIQUE - Personalized to you, and evolves over time based on customer interaction with product.
  • PLATFORMS - Platforms not products.

Have you seen other connected products that include these features?
Do you have suggestions for other additions to the list, or a different
way of grouping them?
What areas of connected products do you think will be most prolific over the coming years, and where will the most impactful innovations come from?

Digital retail experiences: opportunities and trends

Integrating the physical world with digital technology (and vice-versa) is one of the most interesting and opportunity rich territories of our age, and where a lot of the most important work in our industry will be done over the coming years.

I’ve been looking forward to exploring this space with a series of posts for a while, and decided to start with digital in the retail environment.

However, while I’ve taken my sweet time writing this post PSFK came out and released this fantastic presentation on the future of retail.

That’s kind of what I was looking to do here, except way more comprehensive and beautifully produced. Definitely check it out.

I think this post takes a slightly different angle and includes a variety of examples you might not have seen, so hopefully you’ll still get something out of it.

I’ve approached this by looking at how brands are integrating digital to enhance and augment the retail experience throughout the customer journey, broken into seven steps:

  1. Drawing the customer in: engaging shop windows
  2. Ambient in-store interaction, engagement, entertainment
  3. Providing a richer product experience through RFID, shotcodes and augmented reality
  4. Digitally supported sales consultation and advice
  5. The evolution of the fitting room: augmented reality browsing and customization
  6. Facilitating social shopping: getting a second opinion in real-time
  7. Before you leave: digitally-enabled value adds

1. Engaging shop windows

The digital retail experience starts before customers have even entered the store. Here’s a range of examples illustrating how shop windows are increasingly reactive, interactive, and even commerce enabled.

Levi’s interactive windows

Although digital windows are becoming more and more commonplace and most examples are from recent years, I thought it was worth starting with some history. Levi’s was a pioneer in the interactive at retail space, working with experience legends Antirom to create a variety of multimedia kiosks for their flagship stores stretching back to 1995.

In this example from 1998, passers-by could interact with sensors on the glass to control the content displayed on plasma screens inside the windows of the flagship Regent Street store in London, 24 hours a day.

Levi Strauss & Co. Interactive Shop Window (1998) — Playpen.jpg

Esprit Mirror Mirror

Esprit borrowed from Disney mythology to create their “Mirror Mirror” installation, where a fairy godmother calls out to passerbys to brush away some snow from a mirror. The magic mirror then takes a photo of the shopper which is superimposed onto a virtual mannequin.

From there the product experience begins, with the now hooked-in shopper able to apply various outfits to their virtual self, including professionally designed haircuts and 50 items from Esprit’s current range.

The styling process results in a “model card” which is projected in-store, allowing the shopper to find and purchase the items they’ve selected. The model card could also be accessed from a mobile site using a custom QR code displayed in the shop window, and from there shared on to the Esprit Facebook page.

Tommy Hilfiger Collage

At their Trinity Street store in Dublin, Tommy Hilfiger offered window shoppers the opportunity to capture and stylize an image to submit to a collage being streamed in-store, as well as projected onto a series of high-profile buildings in Dublin.

In a nice commercial twist, at the end of the campaign, participants could return to the store to pick up a T-shirt printed with their custom design.

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Top Chef Text to Win

At the NBC Experience Store in Rockefeller Centre, a promotion for Top Chef offered passerbys the chance to win up to $5,000. Simply send a text from your phone to the shortcode to set the slot machine spinning, with your prize details texted back to your phone.

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Elle MacPherson Intimates interactive window

Elle MacPherson went with a simple but eye-catching digital installation, using the movement of people walking by or standing in front of the windows to reveal the video display.

Selfridges augmented reality Tissot demo

Watch brand Tissot built an augmented reality app for their website that allows shoppers to quickly and virtually try on a variety of watches from their homes, without ever setting foot in a shop.

Selfridges and Tissot then partnered to bring the experience to Selfridges’ window display on Oxford Street. Street teams handed out wristbands that activate the experience, and the interactive window display allowed customers to try on the watches, explore watch features and see related videos, before heading in store to try it for real.

Hugo Boss augmented reality window

Fashion brand Hugo Boss also went the augmented reality route for its Black Magic interactive window.

A promotion in London dailies the Stylist and Shortlist drove customers to the Hugo Boss store at Sloane Square, where customers could activate a fashion show in the window with their flyer, and then take it in store to try their luck at a game of virtual blackjack for the chance to win shopping vouchers.

Gimmicky yes, but it fulfilled their goal of garnering attention and driving footfall.

Thomas Cook real-time signage

Although markedly less flashy than the preceding examples, Thomas Cook is using their digital signage in a way that is practical to the brand, and something I expect we’re going to see a lot more of: displaying real-time information.

The travel brand installed in-window digital signage in 80 locations across the UK, allowing Thomas Cook to centrally produce and locally update everything from last minute travel deals through to the latest packages on offer.

2. Ambient in-store interaction, engagement, entertainment

Once you’ve been hooked into the store, digital installations will engage, immerse and entertain you, enticing you to stay and shop.

Intel’s holographic glass display

Intel recently began demoing a proof of concept for something they’re calling “Intel Intelligent Digital Signage”, which may be the most advanced in-store display platform of it’s kind.

It’s a 7-foot-6-inch LCD display with holographic glass that features a plethora of interactive options, allowing shoppers to browse merchandise, read customer reviews, submit their own feedback on products, discover promotions, and share finds with their friends via social and mobile integration.

As if that wasn’t enough, an integrated camera is able to determine gender and age of the viewers, and based on time-of-day and other criteria can dynamically display targeted content. It even stores the interaction with that content along with anonymized demographic data and sends that back to the advertisers.

Intel_s Touch-screen, AR-Packed, Digital Ad Display Almost Isn_t Fair | Fast Company.jpg

S. Oliver

The fashion company s. Oliver has installed screens in their waiting room areas that recognise the sex of the viewers and display films accordingly.

Orange interactive video wall

Mobile brand Orange’s flagship store in Milton Keynes features a massive 4 x 2.5 metre videowall with a number of interactive features.

First was a Mexican wave concept, where store visitors were invited to have a video of them doing the wave on a mobile phone, which would then be uploaded and posted onto the wall along with other wave contributors. When visitors walked by the wall LED sensors would trigger the multi-person wave, effectively saying hello and goodbye to people.

When the wave wasn’t being activated, an ambient ‘Picture Clock’ display would feature photos submitted by residents of Milton Keynes via a UGC website, matching up photo submission times with the current time of the day.

Adidas SLVR

Adidas asked UK design agency Spotspot to imagine a launch space for their SLVR brand. The resulting concept speaks to the potential depth of interactive digital installations in future retail spaces, with connected and responsive digital displays embedded throughout the environment.

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Spotspot | interactive objects for commercial and public spaces | interactive retail experiences | – Adidas SLVR launch-2.jpg

3. Providing a richer product experience

Once you’re shopping, digital technology including shotcode, RFID tagged product and reader displays, and augmented reality are able to provide a wealth of detail around the product you’re interested in, from related products, to reviews, to promotions.

Procter & Gamble RFID Retail

One of the key opportunities in digital retail lies in the fact that increasingly products are being created with embedded digital information via technologies such as RFID.

From a retail perspective, one example of how that could be powerful comes from P&G, in partnership with German retailer Metro Extra.

P&G tagged products at this store with RFID tags, with Metro installing digital displays on the shelfs that were capable of reading these tags and displaying contextual messaging. So if a customer picked a bottle of shampoo off the shelf, the display would recommend the best conditioner to match.

Displays that were used for advertising only might get ignored fast, but imagine if the display were used to bring to life product benefits, instructional details, or even value-based messaging like that around the brands cause marketing initiatives.

Ralph Lauren QR codes

The RFID displays from P&G and Metro Extra are quite a way off from being commonplace, and are quite intrusive on some levels. Another way to go about enabling a deeper product dive is to simply provide a shotcode along with the product, like Ralph Lauren experimented with at their Union Square store in New York.

A touchscreen window display allows shoppers to browse the collection, and select products for purchase via QR codes, sending those purchases directly to a mobile commerce shopping cart.

Another way of implementing this would be to implement QR codes in the retail tags, allowing shoppers to get more information about any product, or to save it for later consideration or purchase.

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Lego kiosk

One of the earliest examples of augmented reality was Lego’s in-store kiosk. The idea is simple — hold up the box to the kiosk, and you can see what the assembled product will look like.

4. Digitally supported sales consultation and advice

The shop assistant can use digital technologies as well to help you evaluate and compare your choices.

Diesel Ginza Interactive Mirror

At Diesel’s store in Ginza, an interactive mirror was designed to enhance the communication between the sales assistant and the shopper. A digital camera can snap photos of up to six outfits, allowing the shopper and salesperson to compare them against each other.

5. The evolution of the fitting room

Once you’ve got some items picked out, augmented reality fitting rooms enable rapid browsing and colour selection.

Adidas augmented reality t-shirt shopping

This sounds complicated but there is an idea in here so bear with me.

In five Asian cities, Adidas ran a print campaign encouraging readers to take a snapshot of an ad with their phone, and then take the snapshot at retail.

Once at retail, customers headed to a digital mirror, and discovered that holding up that image on their phones would trigger an augmented reality t-shirt to display on top of their image in the mirror. The t-shirt was even pre-countoured to fit on a body, allowing you to virtually try it on.

Then to try on the next t-shirt, just give your phone a flick, and the next shirt would appear, allowing you to browse the entire collection.

In terms of results, it’s reported that 75% of the people that used the digital mirror took photos of themselves wearing one of the t-shirts, and 74 people ended up spending over 500 dollars on their shopping visit.

The idea is an evolution of a virtual-shoe fitting mirror released back in 2007 at the Adidas Paris flagship store, which allowed shoppers to virtually try on different footwear.

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The t-shirt execution was much harder to pull off given the need to realistically show the clothes draping on a figure.

This particular mechanism may still be a bit clunky, but the idea of augmented reality shopping could definitely have some merit. A store can only stock so much of a range, and people only have patience to try on so many shirts. If you could scan the entire range and see how it looks on you in minutes rather than hours, that could actually be a useful experience.

Back in 2008 researchers at the Fraunhofer Institute for Telecommunications presented a “virtual mirror” that would allow consumers to do just that via a touchscreen interface on the mirror, which may be more practical than the phone. However you can see that the issue of drapery was still obviously not being addressed at this point, which is where Adidas was looking to innovate a bit further.

Trying On Clothes In A Virtual Mirror | Impact Lab-1.jpg

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6. Facilitating social shopping - getting a second opinion in real-time

Once you’ve got your items picked out, share them virtually with your friends or significant others to get their second opinions.

Diesel Cam

Diesel stores in Spain now come equipped with Diesel Cam, which enables shoppers to photograph themselves with clothes they are trying on and immediately post the photo via Facebook Connect to get feedback from friends, or simply show off.

Manor Tweet Mirror

Nedap Retail has developed “Tweet Mirror”, another social media enabled digital mirror recently installed at Swiss retailer Manor.

The mirror allows you to capture pics of various outfits, compare and share with friends via Twitter, e-mail or mobile for a second opinion.

7. Before you leave — digitally enabled value adds

Estee Lauder Social Media Makeover

This is a much more manual approach than the Diesel Cam, but the output is still very much about digital sharing

Looking to connect with a younger audience than their core 35-55 year old demographic, cosmetics brand Estee Lauder looked at the incredible time and effort their target was putting into social networking spaces and asked the question “where can our brand provide value in this space?”

The answer was the Social Media Makeover promotion — in partnership with Bloomingdales, Estee Lauder would offer free makeovers and professionally produced photos. At the end of the hour long session you’d get a hard copy of your photo and the photo emailed to you, ready for instant profile uploads.

Marketing_ Estee Lauder Promotion Connects With Social Media - Advertising Age - News.jpg

Sony Ericsson Photo Envy

Sony Ericsson and mobile network 3 partnered together for a retail experience called Photo Envy Studio at 3’s store in London’s Oxford Circus. Visitors were directed into the store by street teams, where they were invited to “make their friends jealous by having the perfect pictures taken”, superimposing them in photos of sky diving, bungee jumping or snowboarding.

This one feels a bit inauthentic for an audience who actually does do most of these things themselves, especially with the connection with Sony Ericsson’s ill-conceived and short-lived mascot “Eric”, but the idea of creating currency in-store specifically designed for social sharing is an interesting one.

Summary

The integration of digital technologies into the retail space is still nascent, but it’s clear there is potential for enhancing the customer experience throughout all aspects of their store visit.

Here’s a quick recap of some of the common threads in the above for how digital is being used in the retail environment:

  • Attracting attention, engaging customers and actively driving them into the store
  • Providing intelligent, real-time interactive displays
  • Delivering context sensitive promotions and real-time sales and offers
  • Enhancing the shopping experience, including easier browsing/fitting, enhancing peer and shop assistant review, easy access to product reviews and details
  • Capturing customer demographic and behaviour data
  • Providing in-store experiences
  • Creating a seamless connection between online and retail profiles, enabling social shopping
  • Proliferating interactive touchscreens through the technology getting cheaper and more reliable

Hope this post has been useful, and if you’ve seen other compelling digital retail experiences or can imagine other future applications please leave your thoughts in the comments.

And one last suggestion, definitely check out Helge Tenno’s presentation on New Business Opportunities in Retail:

Helge covers a much broader swathe of ground in his presentation, ranging from product to in-store and business opportunities, and it’s chock full of great examples and thinking.