Leveraging a Connected Ecosystem
We’re living in an age that gives us glimpses of how smart connected technology is beginning to make lives in some parts of the world a little better and easier while in other parts, revolutionizing societies.
The connected ecosystem in which we live can initially provide excellent and memorable experiences, and soon, it will impact the way we live in profound and meaningful ways.
People want the memorable experiences, the comfort, convenience and care that comes with product personalization. They want this product customization experience to be as transparent as possible.
Think of the smart watch on your wrist subtly monitoring your daily habits, the activity tracker that encourages you to move or your child’s connected asthma inhaler that delivers medication adherence, health, environmental (air quality, temperature, humidity) and habit data to you and with permission, to her caregiver ecosystem.
Driving these 21st century capabilities are two key factors: people and data.
This is a win for everyone involved. This personalized service and customized care gives customers the products that make their lives easier, safer, healthier, comfortable and more enjoyable. Companies can increase their brand loyalty and customer trust with devicified products that are responsive, intelligent and highly individualized.
Think of these two key statistics from a recent Segment Survey that reveals the power of personalization:
- Personalization leads to increased revenue: 40 percent of U.S. consumers say they have purchased something more expensive than they planned to because of personalized service.
- Personalization leads to loyalty: 44 percent of consumers say they will likely become repeat buyers after a personalized shopping experience.
To enable this personalization, companies need a partner that has deep expertise in designing and manufacturing within the connected ecosystem. This partnership allows companies to deliver on customer expectations with responsive product design and delivery.
Why Customization and Personalization?
Customization and personalization are more than marketing buzzwords. These two words let companies differentiate themselves with intelligent, responsive and supportive productization.
However, the lines between customization and personalization are often blurred, resulting in a muddied product offering that doesn’t quite live up to customer expectations.
- Customization is the action of modifying something to suit a particular individual or task. This customization is defined by the user to enable the provider to make the product better suit their needs. Customization allows customers to have a say in the product design and services they are willing to pay for.
- Personalization is defined by TechTarget as a means of anticipating and meeting the customer’s needs more effectively and efficiently making interactions faster and easier and, consequently, increasing customer satisfaction and the likelihood of repeat visits. This gives customers a responsive product that anticipates their needs and makes their lives easier, better, safer and more comfortable.
It is the perfect balance between customization and personalization that customers expect and want.
Mass customization describes the concept of producing single-batch, customized products at the same cost and speed of traditional volume manufacturing methods. Mass customization can be truly enabled with a good balance between customization and personalization. Digital technologies like data science, artificial intelligence with basic solid understanding of human factors and devicification can help accelerate that.
In a hotel guest’s mind, it’s not enough to offer amenities that allow her to manually adjust the in-room temperature or to order fluffier pillows from the front desk – she wants a dynamic hotel room experience that automatically adjusts the in-room temperature based on her home settings and a bed that knows her personalized sleep settings, providing a firm mattress with integrated cooling. Even better if the hotel can order her favorite aromatherapy kit – she is a customer for life.
Real personalization connects and shares data, with the user’s acknowledgment across devices and environments to offer products that give individuals experiences that improve and enhance their day-to-day.
This can be as simple as a connected toothbrush that advises you on your brushing habits and maybe notices when the toothbrush head is worn down and then triggers a digital order for new toothbrush heads. It can be a connected asthma inhaler that enhances compliance, resulting in trickle down impacts of improved health, better caregiver communication and further advances in asthma treatment. A wearable disposable ECG patch can untether and enable remote wellbeing monitoring, while flexible hybrid electronics sensors in smart beds can monitor heart rate and weight distribution.
While these devicified products offer people immediate tangible benefits to improve adherence and treatment outcomes, the data can be leveraged for efficient clinical trials and also open up the opportunities for customized medicine recipes or personalized therapy schedules – all portable to the comfort of the patient’s home or office. With devicification, the options are limitless, including democratization of technology.
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The Trends Driving Customization and Personalization
It all comes down to communities, consumers, and conduct. How we live, communicate, interact, work, and seek happiness has changed.
Community in the digital age has changed where people live, how they access and process information, how they commute to work or enjoy activities. This has given rise to a global, but increasingly dense, connected and knowledgeable demographic of people who know what is available and possible.
There is an expectation and understanding that it doesn’t matter where we live – we should all have access to the same value from products and experiences at prices we can afford. Combine this with the impacts of global urbanization on the growth of the middle class and we are seeing a wide range of buying power that places demands on companies for global product availability.
This shift in society has given rise to consumers who have new expectations from the products they buy, the companies they support and the experiences they cherish.
They’re looking for products and brands that mesh with their personal goals and ideals, such as prosperity, comfort, luxury, sustainability, social and environmental impact. This is forcing companies to rethink how they design, package, manufacture, deliver, service and repurpose their products.
Think of the simple fact that everyone, regardless of location and income, has a phone. Grandmothers in India are buying their groceries online with their feature phone, parents in Tokyo are using their sleek smartphones to order pre-cooked meals from their local food delivery service (and then sharing these meals on social media) and youth in Africa use their locally manufactured phones to stay socially active.
Memories are increasingly more important than possessions. Sharing is the new norm and sustainability is cool. Rather than being satisfied with a flat product experience, consumers want products that give more –a personalized experience that they can share with their friends and cherish as a memory. This has forced brands and companies to become more than a logo or a slogan.
Now consumers want to support brands that they believe in and that give them products that they can feel good about supporting. The nature of social media and sharing our product experiences means we want to be associated with brands that in our minds are “doing the right thing” for us and for the general good of others.
The product experience has become at least equally as important, if not more than the product features when it comes to a buying decision. 49 percent of customers bought items they did not intend to buy due to a personalized recommendation from the brand, according to a recent Segment Survey.
We know that consumers are ready and willing to pay for products that make them feel and look good. Data from a recent Bain & Company survey of more than 1,000 online shoppers provides some key buying insights:
- Customers who personalize products online tend to visit the company website more often and are more loyal to the brand.
- Of the more than 1,000 online shoppers surveyed, 25 to 30 percent said they are interested in online customization options.
Consider what this data translates to with this example from the Bain & Company survey report: if 25 percent of online sales of footwear came from customized orders, that would be equal to a market of $2 billion per year.
A Connected Ecosystem Enables Customization and Personalization
The Internet of Things (IoT) and a connected ecosystem make it possible to go beyond basic product offerings. A watch that tells the time is no longer enough; customers want a smartwatch that measures their heart rate, reminds them to pick up the dry cleaning, tells them about traffic slow-downs, helps them sleep better, records an electrocardiogram, allows them to breeze through public transport and shares audio messages from friends and family members to brighten the day. This is one small example of how using the power of the IoT, AI and insight into consumer desire, allows companies to use devicification to deliver a new generation of product and customer experiences.
While the trend for consumer connected systems is rising, a similar transition is happening in the manufacturing world. With the transition to digital manufacturing, products for a consumer connected system are being manufactured and delivered on a connected supply chain (i.e. a digital procurement manufacturing and delivery system). It is interesting to see the intersection of this connected ecosystem emerging in the use and manufacturing of the products that enable customization and personalization.
To effectively deliver a personalized product experience, companies must consider the key pillars of a connected ecosystem:
1. Satisfied Stakeholders
To make personalization and devicification work, the product must meet customer expectations for an advanced experience. These customers then meet the company’s need for paying returning customers, and the manufacturer’s vision to scale high volume production.
2. Accurate Data and Precise Analytics
Delivery on stakeholder expectations requires the collection of accurate data and the creation and visualization of precise analytics. The collection of reliable inputs and data is critical to shaping the connected ecosystem. This data collection and analysis must be fast, efficient, low cost and allow for seamless interconnectivity through the value chain.
The increasingly digital population and product devicification can enable the availability of correct data and accurate analytics - finally making customized and personalized products possible.
3. Procure and Process Data on the Edge
The best way to achieve the above is to procure and process data on the edge with the balance to leverage the capacity of cloud computing. With effective deployment, it is possible to really capture customer desire. This is necessary to tick three key boxes: ensuring that customers get what they want at prices they are willing to pay, giving providers insight into viable products and informing manufacturers of design and production demand. The balance between the many demands of either strategies is the key for the successful solution. One example is the choice to either have more processing of data on the edge, but increasing the processor complexity of the device versus using a higher data rate, and in effect, a larger battery source to transmit the data wirelessly and latently processing the data on the cloud
4. Machines and Devices
Devicification is the key enabler of all of this.
This means we need products that have the capability to collect and interpret customer data. Product providers need to understand why people are buying, what features they like and use the most and how the products are being used.
This product-level data helps companies pivot their brand and supply strategies to meet customer demand. And in turn, gives customers the confidence to consent to the sharing of information and to control the features they value.
Sensorisation and connectivity of machines on smart factory floors allows manufacturers to enable this for their customers. This seamless interconnectivity allows the customized configuration of supply chain and factory floors. Digital process development that leads to intelligent manufacturing is critical - creating a digital thread that connects the customer voice to factory floors is a must-have.
5. Components and Technologies
To make devicification work, takes the ideal use of technology and design. Considerations such as sensor placement, software and hardware design, AI integration, human factors, an advanced understanding of manufacturing, seamless management of materials and services and packaging must all come together to enable the data collection and analysis that informs on customer desire. A solid information technology backbone is critical through-out the entire connected ecosystem.
It’s vitally important that devicification is not done for the sake of devicification. It’s easy to get caught up in forcing interactive features into products without improving the value of these products. This is why it’s key that there is a close collaboration with a partner who has the capabilities and experience to give your product and brand the comprehensive support it needs.
You require a collaborator who can look at your product from all angles and then give you everything you need to take your product in the right direction.
This means working with experts in engineering, miniaturization, design, additive manufacturing, printed electronics and packaging to give you a smart connected product that fulfills customer requirements for brand responsiveness, personalization and experience factor.