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By Mike Cane
When you think of the internet, you think of a network connecting people all over the world. But even back in 2010 it was announced that the number of devices that were not personal computers or phones connected to the Internet exceeded those that were. This is the unseen rise of ‘connected devices’or the ‘Internet of Things’ as its sometimes called. These ‘things’ include security alarms, satnavs and condition monitoring systems that are checking up on our world and silently reporting hidden information, unbeknown to us.
There are trillions of consumer products sold each year and presently only a minute fraction connect to the Internet, so as this proportion rises this world of secret data is going to become more and more significant to our lives. At the Economist’s ‘Technology Futures’ conference earlier this year, this change was described as analogous to the electrification of households and industry in the 18th century. Then new power companies came from nowhere to become major corporations as they worked out how to ‘monetise’ this new technology opportunity.
So what is the benefit of connecting products that for years have been quite happy to exist on their own? Increasingly we will see the products we buy accompanied by services that are delivered online, a so-called ‘digital wrapper’. We are already familiar with buying smart TVs that receive internet based TV services on a subscription basis, but what about buying a fridge that keeps itself full by reordering food by itself? These connected products could potentially have much longer lifecycles because the services around them could be upgraded to keep them competitive. But these novel user benefits are just the tip of the iceberg while more value is being created in other ways.
Industry is always looking for reduced costs and improved performance. Condition monitoring using connected sensors provides opportunities to minimise down time on high value equipment and provide data to continuously improve the reliability of next generations. When a new product is developed it is tested in the lab to ensure it is fit for purpose, but a commercial decision has to be taken to balance the development cost that the market is willing to pay for improved reliability. The laws of statistics demand that the cost of steadily increasing reliability is exponential if you rely on lab tests alone. Smart companies will connect their products so they can use their customers as their test bed and overcome these limits. For example in aero engines, where the value of reliability and performance is extreme, this technology is used so that designs can be improved year on year and, as a result, customers benefit from levels of performance that have transformed air travel.
As the cost of connecting products reduces, these techniques are set to filter down to more of the devices that we use day-to-day. Perhaps in the future our children will never experience a car or domestic appliance ever breaking down, and manufacturers who have not adopted this approach will be not be able to compete. As well as products having associated digital services, services will have new physical products too. In Dubai the pizza company Red Tomato distribute a connected fridge magnet that looks like a pizza. Press the button on the magnet and 20 minutes later a pizza is delivered to your door. The fridge magnet represents the pizza brand and facilitates ordering at the point of consumption.
Currently wireless infrastructure is a limiting factor to connected device developers. In static applications Wi-Fi provides high bandwidth at the cost of high power consumption, cost and set up complexity. Newer standards like ZigBee address some of the constraints. Mobile technologies are more complex with satcoms such as Inmarsat offering high end options. The digital mobile phone networks (GPRS, 3g, 4g) have opened up major opportunities but still provide cost and physical limitations for low end applications. Using existing phones as data hubs using cheaper and less power hungry near-field communications can provide the best opportunities for low cost consumer products today.
One interesting implication of connected products is the opportunity to revolutionise the innovation process itself. For brands to stay ahead they need to offer their customers new and state-of-the-art experiences from their products. Brands that are used to being close to their customers to create these highly targeted new products will gain a game changing new tool. Providers of leading services often use an iterative development process rather than relying on traditional up-front market research to define a new product, using the mantra ‘experiment, measure, learn’. This allows more radical innovation as brands explore beyond where traditional research techniques can predict buying behaviour. Product brands find this harder as they are often a step removed when their customers experience their products. But a connected product can directly report usage data or support and encourage feedback through social media. For example, in fashion retailer C&A’s stores in Brazil, clothes hangers are connected and display how many people have liked that garment on Facebook, so you know how fashionable it really is! This data is also used by the store along with sales data to optimise their stock.
Connected products also offer users new opportunities to create breakthrough product experiences by connecting not only to the manufacturer or a service offer, but products directly to other products themselves, effectively creating an intelligent, customised personal ecosystem. While there is a need for better connection standards to help enable this, pioneering services like IFTT (If This Then That) provide the capability to create these opportunities today. Using the IFTT web site you can create simple automated systems, for example switching on your house heating (using a connected heating controller) when you are 2 miles from home (triggered from a location aware and on-line mobile phone).
This is only the start. Devices and ecosystems could learn about the lifestyle of their owner and optimise their performance at a system level. An example is the Nest thermostat that learns and optimises energy consumption around your lifestyle. But then connected devices could learn from everyone else’s experience too, to facilitate massive optimisation to benefit everyone. At CDP we have developed connected devices where users can update a central database for the benefit of all users.
As well as creating closed networks of similar devices, an exciting possibility would be to have open protocols. In this way devices could communicate with any related devices or services from different manufacturers. This could be a whole new way to define the brand experience. For example, a connected washing machine may choose the most sustainable electricity supply to get its power from, and order the most efficient detergent to be delivered, and configure itself for optimum performance using these products. This appliance behaviour could become the brand experience of tomorrow. This may sound fanciful but it is happening already in the automotive world as standards are being developed to allow cars to communicate with each other to facilitate features like collision avoidance.
Products like this might appear to have personalities, existing both physically in your kitchen or the road and virtually on social media, creating a profile that allows the owner control and interact with the device, while the product itself shouts about its ability to do a great job in your life to everyone else. New potential customers would not need to look to product reviews, they could just look at how the product was behaving on Facebook! Brands or product personalities could become aligned with customer need states. For example the ‘premium eco washing machine’ always choosing high cost/low carbon energy tariffs & optimising water consumption using more expensive eco detergents brands, and even replacing itself with a machine upgrade when a new more efficient model is available. The best brands machines will be ‘polite’, no angry blinking lights, they will self configure (learning wi-fi settings of other devices ), and they will customise themselves, just communicating with their owners in plain English!
These connected product networks could become new retailing channels – for example a brand of connected fridges could offer food from local sources and bypass the big supermarkets. This could see the shopping experience move from out of home shops, to online stores, to the actual products in your home. This could facilitate new, more sustainable pricing models that better reflect the energy needed to deliver the goods or services.
Both manufacturers and consumers could potentially interrogate other people’s products directly (via automated ‘bots’) to find out which are the best devices to buy or to help plan new products or services. Products could record data and inform with their own usage statistics. For example you could find out which model of car is most reliable or has fewest accidents by asking the cars themselves. Perhaps owners could even be paid for providing access to this data.
At Cambridge Design Partnership we believe the future for connected devices is very exciting, bringing both customers and manufacturers many potential benefits. Products and their brands will begin to have personalities and live in people’s lives through social media. They will become more like friends in your network providing you with a richer view of the world and a more efficient lifestyle. The concept of animism – objects having their own spirits, could the new way for us to understand our appliances in this brave new connected world!
By Mike Cane, Founder, Cambridge Design Partnership
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