Hi! My name is Petter Green and I am the marketing manager at Info24. I will be talking about our line of business – adding digital value to physical products and resources.
Today we have 20 years of experience of business development on the internet, and we have a fantastic technology journey behind us. We have smartphones; WiFi; small, cheap sensors that can measure pretty much anything; and much, much more.Unfortunately our mindsets are left behind (somewhere in the 1970s) and need to catch up for us to be able to realise all the commercial possibilities that technology of today has to offer.
Since we the arrival of smartphones five years ago many marketing departments have been working on adding a digital dimension around their physical products in order to increase engagement and shorten the distance to purchase. For example using QR codes in ads and on product tags that lead to digital campaign sites and more product information; and various types of online games and competitions that mix reality with virtuality. Like for BMW/Mini’s innovative Getaway Stockholm challenge in which contestants, using their iPhones, chased a virtual Mini around Stockholm in hope of winning first prize – a real Mini.However, the products themselves have not improved. But that is something we can now change. If we integrate communication and intelligence directly into our products we can create a LOT of value for many industries – some of the industries expected and some surprising.
To allow ourselves to (at least in our minds) mix the physical and the digital, we must ge rid of the view that ”We ARE product vendors”, or ”We ARE service providers”. This view is the rail on the Titanic.We do NOT sell goods. We do NOT sell services. We sell VALUE, and value is the king of all. No matter where it comes from. No matter if it is physical or digital.
So. We do NOT sell paint.
Well sell happy walls and beautiful homes.
We do not sell flowers.
We sell the proof of love and care; kissing yourloved one in the park.
And we do NOT sell trainers.
We sell top performance – getting into shape.
We are all value providers!Nike is a company that early on realised that using a digital perspective the total value of their products reaches far beyond the physical. Nike’s digitally connected shoes and the Fuelband activity tracker are a clear first step towards actually improving the lifestyle of their customers, and making them more successful athletes!Relatively speaking there is not that much innovation in this industry. So adding digital value to their products not only increases Nike’s competitiveness but also strengthens their brand as the most innovative on the market.
You don’t have to be a rich, cool giant like Nike to be innovative. Withing’s bathroom scales connected to the internet help you get into shape. And that is we want, isn’t it?! Not just getting information about how many kilos too fat or too skinny you are!The Withings app help you with motivation. And since the scale is integrated with ecosystems like Runkeeper, you can see how, for example, a certain diet or workout program affects your weight.Every user has his/her own account on the internet where all weight data are stored. This gives Withings a relationship with EVERY user of their product, and a channel for selling value added services. How many bathroom scale vendors do you know of with any type of relationship with their customers??
Digital value helps you climb in the value-chain – this is particularly true for technology providers.One of our customers, Mowic, had had enough of transactional sales and low margins...
...So they packaged solutions with both hardware and digital services enabling road maintenance contractors to optimize snow removal nationwide. Not only can the contractors see where all the snow removal vehicles are in real-time, but they can also see exactly when and where snow has been cleared, and when and where sand and salt has been used. Today Mowic’s profitability has greatly improved compared to before.
Let us look at a few different perspectives that will help us figure out what kind of digital value can be added to our physical products and resources.Data. Virtually everything around us generates data. Our DNA is data! When we love, cough, go to the gym, drive a forklift, have a stroke – when a chicken crosses the road – data is generated. Data that can be extracted and re-packaged into value for ourselves and for others.
To create value out of the data around us we often need nothing more than a smartphone and – of course – a clever analysis/recommendation function.The first app I downloaded – not counting Angry Birds – was Music ID. You just hold it in front of the nearest speaker and, presto, Music ID tells you which song is being played.
Our partner SICS develops a digital coach for cross-country skiers. You attach your smartphone to your chest and then it measures your pulse and how your arms and legs move. And you get the feedback directly into your ear.The main challenge is not technical in nature but rather the design of a good and fast enough analysis function – one that provides high-quality recommendations.
Here you see a device for taking blood samples. It can be kept small and cheap because it uses your smartphone for communication, presentation and power.
A modern tennis racket can last 20-30 years, and this has decreased the industry’s racket sales.Babolat is the third largest manufacturer in the world (and in first place when it comes to innovation). They obviously think that at least part of the cure is digital (and I do too).Babolat recently launched the world’s first digitally connected tennis racket. It is called Babolat Play & Connect. You can analyze your own playing style and the playing style of others - and benchmark against your friends and tennis idols.
The Sport and health industry has shown the way (and this is just the beginning). I look forward to exciting products from other industries. Such as the lawn mower that benchmarks my mowing so that I can compete against my neighbors; the vacuum cleaner that gives my kids points for vacuuming; and the drilling machine that makes me a better home carpenter.
A digital perspective can augment the behavior of your physical products and resources – give them superpowers so to speak.
This is the wireless speaker Sonos. You control it with your smartphone. It integrates with internet services such as Spotify and iTunes to provide ALL THE MUSIC IN THE WORLD. Try to do that without a digital perspective or without the internet...
Today’s version of the radio-controlled airplane. You use your smartphone (of course) to control it and it has a built-in camera. It has potential as more than a toy as it can be programmed to, for example detect movement. So, you could use it for surveillance or to find people that have gone lost in a forest.
Here we have a beer bottle with a sensor in/on the cap. When ever such a bottle is opened a digital signal is sent out and then anything can happen. What I mean to say here is that if you can just find the value of adding digital value to a physical product or resource, technology more and more seldom stands in your way.
Let’s say you are a vending machine operator. Digitally connecting your vending machine means that you can lower your service costs by a third since you will know beforehand when you need to send out a service technician and when you don’t need to.But if you view your products and resources in a social context you can accomplish even more. In the vending machine example: If you have vending machines at say a big company you can double turnover by letting the employees use their work entry cards to take out goods from the vending machines. Payments can be automatically processed via the company’s salary system.
Take every chance to integrate value added marketing into your products and resources. Let your users SHARE with friends and acquaintances the value that your products and resources give them.For example:GIFTING: Let your customers buy an extra chocolate bar (at a discount) from your vending machines that a friend can pick up from any of your vending machines – using an SMS or social media (e.g. facebook).BENCHMARKING: Or make it easy for the user to share benchmarking stats. Example: If you hit the ball as hard as Rafael Nadal, you want everyone to know!SHARE RESOURCES: Or show your eco conscience by adding functionality that allows several people to use the same product or resource.SHARE POSITIVE RESULTS: Or make it easy for users to share extraordinary results, such as weight loss statistics. This can mean a lot for your sales.
Time to sum up. Learn to mix digital and physical value: You give the market more of what it wants, customer loyalty will increase and you will strengthen your brand.And as far as technology is concerned...
...we will take care of that for you! Thank you very much!
MINDSET doesn't cost much - Adding digital value to physical products and resources
MINDSET CREUNA DIGITAL BRIEFING 2012 DOESN’T COST MUCHADDING DIGITAL VALUE TO PHYSICAL PRODUCTS AND RESOURCES PETTER GREEN
MINDSET CREUNA DIGITAL BRIEFING 2012 DOESN’T COST MUCH technologyADDING DIGITAL VALUE TO PHYSICAL PRODUCTS AND RESOURCES PETTER GREEN
FROM MEASUREMENTS TO COACHING MOTIVATION CHANNEL FOR VALUE ADDED SERVICES AND MORE VALUEWEIGHT CHANGES FROM DIGITAL ECOSYSTEMS
MORE PROFITABLE HIGHER UP IN VALUE-CHAIN From GPSes and tech communication... Transactional sales Strong focus on price Low margins Easily replaced
MORE PROFITABLE HIGHER UP IN VALUE-CHAIN From GPSes and tech communication... Transactional sales Strong focus on price Low margins Easily replaced ...to better road maintenance Relationship sales Higher margins Important partner Subscriptions Value added services