Innovation, alongside disruption are two of the most overused words in business at the moment. Like obscenity, many people have their own idea of what innovation is.
Judy Estrin wrote one of the best books about the subject and describes it in terms of hard and soft innovation.
Hard innovation is companies like Intel or Qualcomm at the cutting edge of computer science, materials science and physics
Soft innovation would be companies like Facebook or Yahoo!. Companies that might create new software but didn’t really add to the corpus of innovation
Silicon Valley has moved from hard to soft innovation as it moved away from actually making things. Santa Clara country no longer deserves its Silicon Valley appellation any more than it deserved the previous ‘garden of delights’ as the apricot orchards turned into factories, office campus buildings and suburbs. It’s probably no coincidence that that expertise has moved east to Taiwan due to globalisation.
It can also be more process orientated shaking up an industry. Years ago I worked at an agency at the time of writing is now called WE Worldwide. At the time the client base was predominantly in business technology, consumer technology and pharmaceutical clients.
The company was looking to build a dedicated presence in consumer marketing. One of the business executives brings along a new business opportunity. The company made fancy crisps (chips in the American parlance). They did so using a virtual model. Having private label manufacturers make to the snacks to their recipe and specification. This went down badly with one of the agency’s founders saying ‘I don’t see what’s innovative about that’. She’d worked exclusively in the IT space and thought any software widget was an innovation. She couldn’t appreciate how this start-ups approach challenged the likes of P&G or Kraft Foods.
At the end of last week Amazon unveiled Amazon Dash: an accessory to aid ordering from its Fresh grocery service. Fresh promises free same-day delivery on orders of over $35 of more than 500,000 Amazon items including fresh and local products; including products from respected restaurants and coffee shops. It has been rolled out in three major US markets: San Francisco, Seattle and Southern California.
Fresh has a mobile application on both Android and iOS to aid in shopping – which makes the launch of Dash much more curious. Dash is a piece of dedicated hardware which implies a failing in terms of ease-of-use for the smartphone application. Amazon obviously thinks that Fresh customers will be heavy high-touch, high-value consumers in order to spend this much trouble engineering and manufacturing the hardware and supporting services to make Dash work.
Dash is a product that wouldn’t be out of place in a collection of Braun kitchen appliances. It’s hardware interface so simple it looks really intuitive.
The Amazon Dash can be seen as part of a wider movement from converged general purpose devices to dedicated hardware. It is interesting to compare and contrast the Amazon Dash with the :CueCat; how just over a decade can make such a difference to a product. Back in 2000, Wired magazine sent out the :CueCat to US subscribers of their magazine. The :CueCat was a barcode scanner that allowed readers to augment the print content with a link to web content. Think a prehistoric QRCode. It didn’t work that well for a number of reasons. The codes were proprietary, partly due to consumer privacy requirements and intellectual property around barcodes. In order to use the :CueCat one needed to be connected to an internet-enabled PC via a wired USB or PS2 connection. Using the :CueCat was no easier than typing in a URL or searching via Google; a search engine on the ascendancy at the time. The :CueCat was a spectactular failing for the media industry looking to get to grips with digital media.
Moving forward to the Amazon Dash, the equivalent computing power of that desktop PC has been squeezed into a device that fits in the palm of your hand. Wireless connectivity provides a more flexible connection that removes contextual restrictions on the Dash compared to the :CueCat. The web extended computing so that the website and the PC or mobile device in a symbiotic relationship where it isn’t clear to consumers just were one starts and the other finishes.
The Dash takes inputs via a product barcode and voice memos. Despite the technology advances over the past ten years with the likes of Siri and S-Voice; there will likely be some sort of human intervention required to make these voice memos work. This is at odds with Amazon’s warehouse robot systems and lack of a human customer service face over a telephone line.
This voice memo challenge is not trivial, it was a contributing factor in SpinVox’s failure. The Fresh programme because of its logistical challenges will be hard to scale, and the economics of the Dash have to be carefully balanced between existing products that are repurchased via barcode scan and new or fresh products that would use the voice memo. Acquiring basket growth becomes incrementally more expensive. Over time the system may learn voice commands rather like Google’s old telephone-powered search; on the one hand local area focus is likely to limit dialect variations, on the other sample size maybe hard to scale to be statistically significant for machine learning. More related content here.
Data point: Beacons, retail apps and targeted messaging | JWT Intelligence – beacons powered by BlueTooth LE provide potential opportunities for retailers. Beacons can be used to help facilitate customer in-store navigation. Beacons can also be used to track customers in-store providing a more granular understanding of footfall. More related content here.
2014 China smartphone market and industry – Digitimes – China market to reach 422 million smartphones in 2014, with 278 million units contributed by China-based smartphone vendors. The continued expansion by international vendors Samsung and Apple will push up their sales to almost 144 million units, accounting for nearly 4% growth from 2013 (paywall)
Talk gets cheaper | The Economist – Of the 1.2 billion smartphones that will be shipped this year, almost half will cost less than $200 and one-fifth will cost less than $100
The web as we know it was built on a set of underlying technologies which enable information transport. Not all information is meant to reside in a website to be surfed or queried. Instead much of the information we need relies on context like location, weather or the contents of your fridge. Web technologies provided an lingua franca for these contextual settings and like most technological changes had been a long time in coming.
You could probably trace their origins back to the mid-1990s or earlier, for instance the Weather Underground published Blue Skies; a gopher-based graphical client to run on the Mac for the online weather service back in 1995. At this time Apple were working on a way of syndicating content called MCF (Meta Content Framework) which was used in an early web application called Hot Sauce.
Hot Sauce was a web application that tendered a website’s site map in a crude 3D representation.
A year later PointCast launched its first product which pushed real-time news from a variety of publications to a screen saver that ran on a desktop computer.
The key thing about PointCast was it’s push technology, covered in this edition of the Computer Chronicles
The same year that PointCast launched saw the launch of the XML standard: markup language that defines a set of rules for encoding documents in a format that is both human-readable and machine-readable. This meant that there was a template to provide documents and stream information over the web.
Some of the Apple team responsible for MCF had moved to Netscape and worked on ways of importing content from various media outlets into the my.netscape.com portal; they created the first version of RSS (then called RDF) in 1999. The same year, Darcy DiNucci coined the term web 2.0; whilst this is associated with the rise of social networks, it is as much about the knitting of websites: the provision of services online, integration between websites taking data from one source and melding it with another using a web API formatted in an XML type format or JSON – which does the same job.
By the early noughties applications like Konfabulator (later Yahoo! Widgets) launched their first application to ‘put a skin on any information that you want’.
Major web properties started to license their content through APIs, one of the critical ideas that Flickr popularised was that attribution of the data source had its own value in content licensing. It was was happy to share photos hosted on the service for widgets and gizmos so long as users could go back through the content to the Flickr site. This ability to monetise attribution is the reason why you have Google Maps on the smartphone.
So you had data that could be useful and the mechanism to provide it in real time. What it didn’t have so far was contextual data to shape that stream and a way of interfacing with the real world. In parallel to what was being driven out of the US on the web, was mobile development in Europe and Asia. It is hard to understand now, but SMS based services and ringtones delivered over-the-air to handsets were the big consumer digital businesses of their day. Jamba! and their Crazy Frog character were consumer household names in the mid noughties. It was in Europe were a number of the ingredients for the next stages were being created in meaningful consumer products. The first smartphones had been created more as phones with PDAs attached and quicker networks speeds allowed them to be more than glorified personal information managers.
The first phone that pulled all the requisite ingredients together was Nokia’s N95 in early 2007, it had:
A good enough camera that could interact with QRcodes and other things in the real world
Powerful enough hardware to run complex software applications and interact with server-side applications
A small but legible colour screen
3G and wi-fi chipsets which was important because 3G networks weren’t that great (they still arent) and a minimum amount of data network performance is required
A built-in GPS unit, so the phone ‘knew’ where it was. Where you are allows for a lot of contextual information to be overlaid for the consumer: weather, interesting things nearby, sales offers at local stores etc
All of these ingredients had been available separately in other phones, but they had never been put together before in a well-designed package. Nokia sold over 10 million N95s in the space of a year. Unfortunately for Nokia, Apple came out with the iPhone the following autumn and changed the game.
It is a matter of debate, but the computing power inside the original iPhone was broadly comparable to having a 1998 vintage desktop PC with a decent graphics card in the palm of your hand. These two devices set the tone for mobile computing moving forwards; MEMs like accelerometers and GPS units gave mobile devices context about their immediate surroundings: location, direction, speed. And the large touch screen provided the canvas for applications.
Locative media was something that was talked about publicly since 2004 by companies like Nokia, at first it was done using laptops and GPS units, its history in art and media circles goes back further; for instance Kate Armstrong’s essay Data and Narrative: Location Aware Fiction was published on October 31, 2003 presumably as a result of considerable prior debate. By 2007 William Gibson’s novel Spook Country explored the idea that cyberspace was everting: it was being integrated into the real-world rather than separate from it, and that cyberspace had become an indistinguishable element of our physical space.
As all of these things were happening around me I was asked to speak with digital marketers in Spain about the future of digital at the end of 2008 when I was thinking about all these things. Charlene Li had described social networks as becoming like air in terms of their pervasive nature and was echoed in her book Groundswell.
Looking back on it, I am sure that Li’s quote partly inspired me to look to Bruce Lee when thinking about the future of digital, in particular his quote on water got me thinking about the kind of contextual data that we’ve discussed in this post:
Don’t get set into one form, adapt it and build your own, and let it grow, be like water. Empty your mind, be formless, shapeless — like water. Now you put water in a cup, it becomes the cup; You put water into a bottle it becomes the bottle; You put it in a teapot it becomes the teapot. Now water can flow or it can crash. Be water, my friend.
Lee wrote these words about his martial arts for a TV series called Longstreet where he played Li Tsung – a martial arts instructor to the main character. Inspired by this I talked about the web-of-no-web inspired by Lee’s Jeet Kune Do of ‘using no way as way‘.
In the the slide I highlighted the then new points of interaction between web technologies and platforms with the real world including smartphones, Twitter’s real-world meet-ups, the Wii-controller and QRcodes.
A big part of that context was around location aware applications for instance:
Foursquare-esque bar and shop recommendations
Parcel tracking
Location based special offers
Pay-per-mile car insurance
Congestion charging
Location-based social networking (or real-world avoidance a la Incognito)
Mobile phone tour guides
And that was all things being done six years ago, with more data sets being integrated the possibilities and societal implications become much bigger. A utopian vision of this world was portrayed in Wired magazine’s Welcome To The Programmable World; where real-world things like getting your regular coffee order ready happen as if by magic, in reality triggered by smartphone-like devices interacting with the coffee shop’s online systems, overlaid with mapping data, information on distances and walking or travel times and algorithms.
What hasn’t been done too well so far has been the interface to the human. Touch screen smartphones have been useful but there are limitations to the pictures under glass metaphor. Whilst wearable computing has been experimented with since the early 1970s and helped in the development of military HUDs (head-up diplays) and interactive voice systems, it hasn’t been that successful in terms of providing a compelling experience. The reasons for this are many fold:
Battery technology lags semiconductor technology; Google Glass lasts about 45 minutes
The owner needs to be mindful of the device: smartphone users worry about the screen, Nike Fuelband wearers have to remember to take them off before going and having a swim or a shower
Designs haven’t considered social factors adequately; devices like Google Glass are best matched for providing ‘sneak information’ just-in-time snippets unobtrusively, yet users disengage eye contact interrupting social interaction. Secondly Google device doubles as a surveillance device antagonising other people
Many of the applications don’t play to the devices strengths or aren’t worth the hassle of using the device – they lack utility and merit
That doesn’t mean that they won’t be a category killer wearable device or application but that they haven’t been put on the market yet.
Bassline: The UK Dance Scene That Was Killed by the Police | VICE United Kingdom – Bassline was a Sheffield-specific scene. Sheffield has had a history of birthing electronic music genres. The most notable one for me was the bleep techno scene from the late 1980s. Bassline built on the trends that came before it. It has a more driving 4:4 beat than speed garage, lush burbling analogue synths for the techno and acid house heritage of the city. Finally some of the bassline tracks had some string stabs that brought to mind the early Chicago house and detroit technology a la Rhythm is Rhythm and OctaveOne.
The policing policies of the early 2000s were an extension of the top down culture war against youth culture of the late 1980s and early 1990s. We missed out on an interesting time in dance music with bassline. Who knows where it might have taken things, could bassline have led to a less sterile EDM sound?
Alibaba bets on Taobao mobile app to boost sales | WantChinaTimes – Chinese e-commerce giant Alibaba Group launched the 24-hour sale “Mobile Taobao 3.8 Life Festival” on March 8 in a bid to boost transactions made via mobile devices and drive mobile app adoption
Health groups call to end “Be a Marlboro” campaign | Marketing-Interactive – I grew up with ‘Marlboro Country’ billboards showing the cigarette to be the poison of choice for the middle-aged cowboy taking a break. Be Marlboro was a much need revamp of the Marlboro brand. Modern-day UK Marlboro man could also be a woman; they smoked them in-or-outside the club. Occasionally they broke them down and smoked them with cannabis.
Don’t be a maybe. Be Marlboro
Philip Morris International
The campaign went out in over 64 countries worldwide from Germany to Indonesia. Its rationale was a world away from Marlboro Country
young adults feel overwhelmed by the flood of information and options that new technologies offer. In this time of uncertainty, they have very few life compasses that can provide them with guidance. With the new campaign, Marlboro encourages them to be decisive, trust themselves and follow their inspiration. The concept is very simple: there are three ways to react when faced with a decision: Yes, No, or Maybe. Marlboro does not believe in Maybes
Frederic de Wilde, Philip Morris International Investor Day – Brand Portfolio and Commercial Approach – Script, 21 June 2012
The universal insight that Be Marlboro tapped into is interesting, the discovering yourself moments and the later impostor syndrome of youth.
Business
Plans to boost cultural and creative industries in China | WantChinaTimes – China’s State Council, on Friday released plans aimed at promoting the integration of the creative and design service industries with the real economy – interesting description as if somehow creative and design services aren’t real
China’s super-rich will rise 80% in the next decade | Shanghaist – A report released by Knight Frank LLP earlier this week says that the number of China’s super-rich, those who own more than 30 million USD in assets, will grow as much as 80 percent in the next decade, according to the Global Times.
How Hong Kong Lost the Alibaba IPO – WSJ.com – Alibaba wanted to nominate the bulk of the board post listing rather than one share, one vote – which is enshrined in Hong Kong’s regulations (paywall)
Check Out How Coca Cola Makes the Most of WeChat Marketing – Do You still remember the “nickname bottle” that Coca Cola launched last summer? Such an impressive case was not so long ago, now Coca Cola has shifted its focus from bottle to cap, joining up with WeChat.
Will ‘Makers’ Change Shenzhen? | EE Times – which touches on how China will move up the value chain to be the innovator and designers of products rather than just the assemblers
Windows hits the skids, Mac OS X on the rise | The Register – Apple’s OS X share more than doubles in past six years, Windows below 90% – first time since the 90s years Peak Microsoft. According to two different web-analytics groups – NetMarketShare and StatCounter – Windows’ market share has dropped to below 90 per cent for the first time since the mid 1990s
