how smart products transform brand relationships, business operations and service experiences by...
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© EVRYTHNG Inc. | 2015
evrythng.com | @evrythng
Smarter products come with EVRYTHNG
PRODUCT VOICE: THE 3RD AGE OF MARKETINGHow smart products transform brand relationships, business operations and service experiences
Change happens fast
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It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.
—Charles Darwin
“
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Every Thing Connected.
Products Solutions Components Ecosystem Concepts Platform feature Lower level features
Washing machine
Light bulb
Thermostat
AC unit
Plug
Bike
Watch
Accessories
Coffee Machine
Oven
Bottle of wine
Medicine bottle
Can of drink
Lipstick
Shoes
Item of clothing
Food
Brand protection
Track and Trace
Consumer Engagement
Connect and Control
Product Registration
Product re-ordering
Sense & Extend
NFC tag
RFID tag
barcode
qr code
Image Recognition
Printed Electronics
Sensors
Embedded microchip
Beacons
RFID reader
CRM (Salesforce)
ERP/MRP (SAP)
Google+
YouTube
shopping cart
Hme
Shop
Factory
Truck
Palette Crate
Farm
Recycling
Item of clothing
Food
Alerts Rules Engine
Business intelligence
Location tracking
API
Data
Data store
Communications broker
Cloud to Cloud connectors
Scanning software
Authentication
Security
Scalability
Dashboard
Real-time data management
Identity ManagementProduct connection management
Administration & Analytics
Integrations
Developer Toolkits
Platform
Watch
Accessories
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Technology’s 3rd Wave
Welcome to the new HBR.org. Here’s what’s new. Here’s an FAQ.
COMPETITION
How Smart, Connected Products AreTransforming Competitionby Michael E. Porter and James E. Heppelmann
FROM THE NOVEMBER 2014 ISSUE
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FURTHER READING
Strategic Choices in Building the Smart, Connected MineCOMPETITIVE STRATEGY FEATURE
Visit our companion case study and video on how Joy Global’s smart,
connected mining equipment transforms mine performance.
� SAVE � SHARE
nformation technology is revolutionizing products. Once composed solely of mechanical and electrical parts, products have become complex
systems that combine hardware, sensors, data storage, microprocessors, software, and connectivity in myriad ways. These “smart, connected
products”—made possible by vast improvements in processing power and device miniaturization and by the network benefits of ubiquitous
wireless connectivity—have unleashed a new era of competition.
Smart, connected products offer exponentially expanding opportunities for new functionality, far greater reliability, much higher product
utilization, and capabilities that cut across and transcend traditional product boundaries. The changing nature of products is also disrupting value
chains, forcing companies to rethink and retool nearly everything they do internally.
These new types of products alter industry structure and the nature of
competition, exposing companies to new competitive opportunities and
threats. They are reshaping industry boundaries and creating entirely
new industries. In many companies, smart, connected products will
force the fundamental question, “What business am I in?”
Smart, connected products raise a new set of strategic choices related to how value is created and captured, how the prodigious amount of new
(and sensitive) data they generate is utilized and managed, how relationships with traditional business partners such as channels are redefined,
and what role companies should play as industry boundaries are expanded.
The phrase “internet of things” has arisen to reflect the growing number of smart, connected products and highlight the new opportunities they
can represent. Yet this phrase is not very helpful in understanding the phenomenon or its implications. The internet, whether involving people or
things, is simply a mechanism for transmitting information. What makes smart, connected products fundamentally different is not the internet,
but the changing nature of the “things.” It is the expanded capabilities of smart, connected products and the data they generate that are ushering
in a new era of competition. Companies must look beyond the technologies themselves to the competitive transformation taking place. This
article, and a companion piece to be published soon in HBR, will deconstruct the smart, connected products revolution and explore its strategic
and operational implications.
The Third Wave of IT-Driven Competition
Idea cards
Personalized, risk-adjusted premiums
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Products get a voice
“BRAND VOICE” “CONSUMER VOICE” “PRODUCT VOICE”
Marketing’s Third Age
Z
IFI’MLOST,GOOGLEME!
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AS CLEVER AS AS EASY AS AS IMMEDIATE AS AS ON DEMAND AS
AS SOCIAL AS AS PERSONAL AS AS ENTERTAINING ASAS VISUAL AS
The EVRYTHNG IoT Smart Products Platform
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TIME
VALUE
Smart Products Roadmap
Ecosystem-Connected Products
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Products As-A-Service
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Products As-Media
PRODUCTS-AS-MEDIA
Product
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‘Check-in’ & Share-to-Win
I’m empty Re-order me
Your exercise goal has been
achieved
Personalizing products with emotional digital content
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Idea cards
Digital interfaces to replenish physical goods
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Dom Perignon Case Study
Product Relationship Management
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I’m Dave, this is purchase no. #2. I live in NYC. I’m happy to talk.
1 Unit Sold
?
I’m using the product right now. I want the premium features!
Idea cards
Personal digital tennis coach service via racket sensors
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Source: “Why Strong Customer Relationships Trump Powerful Brands”, HBR, 2014.
REPEAT CUSTOMER VALUE
BRAND VALUE
% ENTERPRISE VALUE
PRODUCT-AS-A-SERVICE
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Real-time Product Tracking, Analytics & Alerts
mass produced, one size fits all
customized, personalized
static, stand-alone, always degrading
dynamic, connected, always improving
customer adapts to product
product adapts to the customer
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Gorgeous design, energy efficiency and automatic personalization
SERVICES
OBJECT
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Idea cards
A Tesla upgrades its performance & fixes itself for free while you sleep
Idea cards
Sonos delivers “new features and services automatically”
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Lighting-as-a-Service creates multiple new revenue streams
ECOSYSTEM-CONNECTED PRODUCTS
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iHome’s smart products plug in to all connected home hubs
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iHome’s smart products plug in to all home hubs
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The IoT reshapes industries into interconnected ecosystems
+ + ++
Lower Healthcare Premiums
Free Gym Membership
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"Howdidyougobankrupt?"Billasked."Twoways,"Mikesaid."Graduallyandthensuddenly." —Ernest Hemingway, “The Sun Also Rises”, 1926
Smarter products come with
Connection | Protection | Engagement | Transactions | Tracking
Andy HobsbawmFounder & CMO
[email protected] @AndyHobs