The challenges of a third digital revolution
Global Head of Digital
In just 20 years, we have experienced two major digital revolutions, both of which have led to unprecedented technological, economic and societal transformation. The first was the information revolution and the second: mobility.
All relationships and transactions have been impacted by these two revolutions, from communication channels and formats to distribution models. Google, Amazon, Facebook and Apple have transformed the economy, and new players like Uber, Netflix and Airbnb are turning business models on their head. The relationship people have with brands has, as a result of all of this, also changed.
While many brands try to adapt to these forces of change, a third phase of transformation is already upon us: the Internet of Things. This refers to objects that are connected to the internet and to each other.
France’s communications regulator, ARCEP, estimates there will be 2 billion connected objects in France within five years. That’s 40 objects per person. But we are not yet there.
The latest edition of the Kantar ConnectedLife study in 2017 shows that only 8 percent of French people currently own a « wearable » tech device, such a smartwatch or fitness tracker, up from 6 percent a year earlier, which is a slower pace of growth than is being seen globally. Why? The barriers seem to be a lack of understanding of the technology and price, but more importantly, most people who don’t have a connected device (58 percent) say they just can’t see the point.
What’s the use?
It’s essential that these connected objects meet needs! For the past 10 years, manufacturers have been able to offer devices with innovative functions and design in line with consumers' expectations of connection, and they must now invent the uses that match.
These objects will have an extraordinary ability to collect data - ultra-personalized data. Great! But this must be used to fuel innovation that helps people improve their daily lives.
Beyond the object, it will be necessary to think of the service being provided, and to seize the opportunity to provide a highly personal experience and a useful experience. Monitoring health or physical activity (as connected bracelets now do) can obviously help people improve their health. But they are also a source of consumer anxiety: what if insurers use the data to put up premiums? Consumers need relevant information that shows them the benefits of being connected.
Connected objects could also offer the possibility of creating a unique relationship with users to help improve and streamline the customer journey. Today, consumers are already interacting with myriad different platforms and devices. All this becomes more complex with the rise of connected objects. What will matter most to consumers then will be the quality and consistency of their interaction with a brand, and the overall customer experience. Already, customers have an average of six points of contact with a brand before they buy; when this increases, consistency will be even more important.
The ability to respond proactively to consumers’ needs in the moment can obviously mark the beginning of a new era for the advertising world. This would shift us from hit-and-miss mass communication to 100 percent-relevant advertising that meets the specific needs of the individual. But sending the right message via the right channel at the right time is already a challenge for brands, which are having a hard time adapting to the current interpersonal ecosystem of Web 2.0. With connected objects, it will only be more complex.
Most importantly, all of this change must take place without excessive intrusion. The internet today gives individuals the chance to seek and find, but with connected objects, it is the objects and the internet themselves that will do the seeking and finding. Brands need to ensure that whatever they offer via connected devices is both useful and desirable to the consumer.