Fjord’s Annual Trends focus on the digital developments we expect to disrupt organizations and society in the year ahead.
We hope Trends will motivate, inspire and provide actionable insights to help businesses and society move forward in the coming year.
We’ve drawn insight and inspiration from Fjord’s team of 750+ designers, developers and thought leaders to create this year’s 10 trends.
Today, someone is always listening. We have listening devices strapped to our wrists that encourage us to run farther or put down that extra slice of cake. Devices in our homes listen, respond and reorder. These are new, everyday interactions that make it okay for us to share data previously kept private. Whether it’s literally listening to voice commands or the streams of data we create, devices are learning from our micromoments.
Listening gives Amazon insight into what we buy and how often. And it’s listening that shows insurance companies just how healthy we are. In this ecosystem, every action can be beamed, but in return, we get effortless transactions and reactions, not to mention (sometimes) an alternative to glowing screens.
Micromoments are mighty.
Listening technology allows us to act on any impulse whenever – we can buy, learn, communicate, find, do. All of this has broken the customer journey into a plethora of real-time, intent-driven micromoments. It follows a very predictable pattern – immediate need, relevant reply, repeat – but in an unpredictable sequence. It’s changing the way we consume. People go online more often, but don’t spend as much time per visit.
This shift has tremendous implications for brands: Consumers are moving away from long-term immersive research, instead seeking short periods of very focused activities that need to be satisfied with bite-sized snippets. Deliver on these micromoments or someone else will.
Each is an opportunity for brands to shape our habits. Changing how people continue to “feed” existing habits is just as important as creating new ones. For example, there are electronic toothbrushes that count each stroke and provide immediate reinforcement, which is beneficial for both children and cavity-ridden adults (not to mention many dentists).
Being able to detect exactly how and when consumers decide to reorder a recurring product could prove to be priceless. Faceless services have broken the privacy barrier. Services are inside the home in ways that have never been possible before, and they have the power to simplify our lives by automating many tasks. But taking advantage of such convenience means brands have access to every move we make. Aggregate that data, and you can get a very interesting picture of a consumer.
AI will continue to further push the boundaries of intelligence and design. IBM’s Watson, which uses cognitive technology in a variety of applications from oncology to clinical trial matches, is a technology platform that uses natural language processing and machine learning to reveal insights from large amounts of unstructured data. This type of cognitive technology is the start of the next wave of digital disruption.
Providing ease through shorter interactions comes at a high cost for competing brands. Early movers will have the ultimate advantage. Imagine a scenario where you ask Alexa for more yogurt, and she orders a brand you preselected. Instantly, every other brand is edged out with a single command. Not every brand should develop its own wearable, nearable or connected environment. Consider whom to partner with to distribute your service.
Brands must be able to listen to the messages they are being sent, either explicitly or implicitly. At a minimum, design to show you have heard.
As brands continue to capture more data about customers’ lives, the question of privacy and data protection looms large. Companies must consider how to best share and protect their customers’ information. Read more about our view on Services with Manners.
Smart technology is offering unprecedented views into who we are and what’s happening in our homes, our cars, our bodies and our loved ones’ bodies. We’ve already begun to see Living Services positively impact healthcare, city planning, environmental footprints and more. But with this surge of opportunity comes an extraordinary level of responsibility, and the ability for organizations to leverage these vast data sets in an ethical manner is more important than ever.
The success of this connected, transformed world largely hinges on how organizations choose to invest in proper, respectful data practices.
At Fjord, we call the etiquette of big data “services with manners.”
Collection of personal data is nothing new. However, in the post-Snowden era, the public is anxiously aware that businesses and governments are doing so, and there is a pervasive Orwellian culture of distrust.
Digital trust is more important than ever. In a data economy, data protection and security is a social responsibility. Those that fail to earn trust in how they collect, store and control data will not only lose business and face possible legal ramifications; they will fail to reach their full potential.
Yet, data is a good thing. In fact, three out of four consumers say they prefer to do business with retailers who use personal information to make their shopping experience more relevant.
The good news is that organizations and policymakers have begun to reverse-engineer consumer distrust with innovative solutions. The Federal Trade Commission released a report in January 2015 on the Internet of Things, which outlined a series of steps businesses can take to protect the privacy and security of personal data.
We expect better practices in business and government. Fitbit is the perfect example of this confluence. In September, the company achieved compliance with the Health Insurance Portability and Accountability Act, a U.S. law that protects personal health information. “We prioritize protecting our consumers’ privacy and keeping their data secure,” the Fitbit CEO says.
The concept of “privacy by design” is another area that is taking shape. The notion states that privacy standards should be embedded into technology and the product design process from the get-go.
Main players like Microsoft have already implemented strong privacy programs based on the concept, and the EU’s impending General Data Protection Regulation includes privacy by design standards, which will mark the first time it has been incorporated into law.
At the heart of Living Services is the opportunity to improve our lives and world, and with that, consumers must clearly see the benefit of sharing their personal data with companies – a quid pro quo in the form of discounts, valuable content, added convenience or personalized services.
Act out interactions as if they were a conversation on stage. Make your experience a human one. Imagine you were asking a stranger on the street for private information. How would you go about it in a way that would make him or her feel comfortable? Empathetic design changes the camera angle and puts you in other people’s shoes.
Remember that brands and corporations are being judged on the same principles and values as a person would. Make sure the intent of a data exchange is upfront, friendly and clear. Find etiquette allies.
Yes, seamless experiences are the goal, but be transparent about transition states. People want to know when they’re getting locked into something.
Beef up resources dedicated to data privacy and security. On a systems level, invest in new platforms and technologies equipped to handle data responsibly through the supply chain.
As demand grows for best-in-class experiences in our private lives, the same level of service can be expected in the workplace. Simply put, employees now expect tailored experiences, fast evolution and personal connection in their careers. As a result, we are seeing the emergence of employee experience (EX) design, where workplace processes, structure and culture are all reimagined at an organizational level.
It was the fastest growing category of work at Fjord in 2015 across many industries, from banking to telecom to pharma.
Career paths are no longer linear journeys. Employees once started with a foot in the corporate door, paid their dues and worked their way up the proverbial ladder. Now, employees are treating their careers as a series of “tours,” using each new employer as a way to establish a self-determined path, build critical skills and grow outwards.
Many jobs in the U.S. today are service-related. Technology has enabled skills that are easily transferable across industries. Companies are battling for top-tier talent, and the next generation. Technology has also paved the way for workers to provide services on the supply side of apps like Lyft or TaskRabbit.
During the next 10 years, a philosophical tug-of-war between four generational mindsets will be a reality. On one side, Gen X and baby boomers adhere to more traditional forms of career progression.
On the other, millennials and Gen Z, who tend to be more transient, idealize jobs where social impact plays a role. These two subsets will shape the future of the companies they work for.
The mismatch is very visible in digital tools. The disconnect between delightful consumer-facing software and clunky workplace tools for anything from time entry to procurement or travel booking is stark for employees, and companies need to move fast to re-imagine the digital services and touchpoints that their employees use.
Cultures of purpose
Building cultures of purpose will be a top priority of leadership in corporations, through both further experimentation with organizational models as well as the development of employee-centric tools that blend functionality and empowerment. The talent landscape is changing in emerging markets. India, South Africa and China are the most rapidly evolving digital markets, and the skilled labor surplus in those markets will be positioned to meet skilled labor shortages in the developed world. India – with the world’s youngest median population at 29 years old and 12 million people joining the workforce every year – will have a skilled labor surplus of 47 million by 2025, nearly matching the projected skilled labor shortage of 56 million in the developed world. We foresee the global labor market becoming even more flat as EX matures and evolves over time.
Within the decade, AI will play a huge part in our workflow. It’s already happening in the case of Minwa, a Chinese supercomputer that can sort a million images into a thousand predefined categories with an error rate less than the typical person. With AI advances like this, we’ll be able to focus on the tasks where humans always trump AI, like creative decisions.
Autonomy breeds motivation. No one wants to feel like part of the machine, nor do they want to feel that taking initiative at work is daunting because of a lack of clarity on process. Employees tell us they want to feel inspired to work and focus on what matters to them, be essential to the success of the company and be trusted to be thought leaders who can make important decisions autonomously.
Who we are is as important as what we do. Employees want to feel assured, open and included. Work should be a peer experience that is an extension of their social world.
Money isn’t the only payoff. Being acknowledged, feeling unified and supported with the right tools are all things employees want in an ideal work environment.
Apps have reached a tipping point, where they’ve shifted from being user-controlled to proactively powering a user’s life. Is the dominance of standard apps about to be broken? We are in the midst of the atomization of apps. Atomized brands take a less rigid approach to their products and services, allowing them to be super distributed across various platforms and third-party services, while still retaining their brand identity. They operate in a world where the rules of branding and conventional business structures are fundamentally challenged and disrupted, where services appear to offer themselves intuitively to consumers according to their time, place or situation.
Atomization is widespread in music streaming apps like Spotify, which now transcends environments (think: your living room to your car to your workspace) and is delivered through various branded partnerships. The atomization of Spotify is part of a much bigger transition we’re now witnessing.
We’ve become app administrators – downloading, opening, closing, deleting and toggling. In response, developers have taken the best services of apps and implemented them in more natural use cases.
Services are becoming more intelligent and integrated as they are atomized. Google’s new Now on Tap feature acts as a personal assistant, examining whatever is on the screen and automatically taking relevant actions. Impressively, it “understands” information about 100 million places – not just where they are located, but when they are busy, when they are open and what you’re likely to need when you’re there.
The act of toggling between apps may disappear. No case is stronger than WeChat, a Chinese messaging app with nearly 600 million monthly active users. Known as the “everything app,” WeChat functions beyond the traditional definition of an app or even a browser, with 10 million third-party apps hosted inside. One feature controls the lights, temperature and settings of your hotel room.
Visa is researching the commerce-connected car that pays for groceries, takeaways and fuel – literally payments (and collection) on wheels. Service or app?
The future of “app” design will be counterintuitive. Most organizations currently focus on the transaction of a service – and rationally so. However, if you focus on the interaction, or “point of x,” and make it as smooth as possible, the transaction will happen naturally. It’s about designing for humans, focusing on interactions instead of transactions.
We’ve reached a point where all the technologies and services we have created over the years can intersect and interact with each other autonomously and independent of hand-held devices. Nest is a promising “point of x” that could evolve quickly to be a home hub in rivalry with Amazon Echo. Imagine banking apps seamlessly integrated within a domestic device like this, allowing a user to pay bills, bring in a cleaning service, order groceries, share pictures and more. Cars present another environment where “point of x” thinking will trump apps.
Invest in understanding what future “points of x” will be for your user, and design around them. Partner wisely or build your own “point of x” offerings to win the service moments that matter most to users.
We are moving beyond apps as “things” and into services that may or may not require human interaction to activate. We can untether ourselves from the need to design an app for everything; very often we can find better entry points for services than mobile apps. There must be incentives to motivate this shift – ease of use and fewer steps can be the driver for that.
Journey maps, service blueprints, touchpoint reframing: These are standard tools in the design kit these days and are becoming even more relevant as the self-contained certainty of apps dissolve.
Which is more impressive: old or new money? Technology is beginning to upend the notion of both, by opening up the luxury service market to the masses. In the past, highly tailored experiences were reserved for the very wealthy, with costs and scale being the main barrier to entry. But with digital technology enabling highly scalable yet personalized experiences, luxury is now available for the masses like never before.
Lifestyles and benefits of the very privileged are becoming suddenly mainstream, thanks to tech. We have chauffeurs drive us from point A to B. Personal assistants wait in line for us, do simple maintenance in the home or assemble furniture (TaskRabbit). Our laundry is picked up, cleaned and delivered to our door (Washio). And our favorite dishes from world-renowned restaurants are delivered to our homes (Caviar). My, how far the world has come.
Scalable, ubiquitous computing has dramatically changed our perception of what is feasible and within the reach of our social sphere.
Using analytics, intuitive visualizations, timely notifications and guidance, financial services can now act as personal advisors for mass-market customers. They analyze patterns of money-related behaviors such as income, spending, savings, and offer strategies that only an elite few could use before.
Peer-to-peer lending is sweeping both developed and developing markets. P2P organizations directly connect borrowers (who are often rejected by traditional banks) and lenders. They also manage each investor’s risk exposure by helping to diversify the lending portfolio.
Instacart is delivering personal grocery shopping to the masses. This crowdsourced model is a mobile service that allows users to order groceries from multiple local stores and have it delivered within an hour.
Examples abound in a variety of areas like personal assistants from Facebook with M, affordable luxury getaways with Tablet Hotels, pampering with Birchbox and your own personal fashion stylist through Trunk Club.
In the future, any industry with traditional roles and privileged expertise will be challenged. Data ubiquity, E2E customer experience engineering and evolving technologies have become fuel for the democratization of services in banking, healthcare, education, shopping and more.
Prestigious education is no exception. Harvard University is one of many that are now publishing recordings of lectures online. Other digital education platforms offering valuable services include Coursera, edX, Khan Academy, Nautilus and Udacity.
These are competing with leading universities by offering full educational programs in high-demand specializations.
As we see the flattening of services, expect to see the emergence of a new strand of luxury, enabled by digital and available to the only to the top of the wealth class. Think personalized technology platforms, or rather, a platinum iOS. After all, mankind is still a status-driven animal.
Business analysts, designers, marketing, product and service managers should work hand in hand.
A collaborative and diverse work environment will become an intangible asset that will help companies better aim their efforts toward understanding the users of the future.
Seek to transform one-directional businesses into scalable platforms that will empower future users not just to consume services but to find solutions to their problems.
In the luxury business? What does it take to remain a true “luxury” brand in an era of digital democratization? Examine your role from the consumer perspective and ask how you can disrupt your service model now that delivering luxury can be done by anyone. In the era of liquid expectations, what exactly is luxury and high-end?
The entry of design into governments is coming about both as a generation of digital natives start to enter junior ministerial ranks, bringing their understanding of liquid expectations with them, and as a way of saving cost in an age (in many countries) of “austerity.” From connecting communities around a cause, addressing asymmetries of information and giving the underrepresented a voice, there has been a great leap forward in terms of how some governments are thinking about the citizen experience.
This is moving from a one-size-fits-all approach to finely tuned services that are tailored to individual needs.
We’re even seeing archaic government departments step aside to allow for citizen-centric holistic solutions. This is the year when technology will be in service of the public good. And more importantly, technology will enable a new breed of citizenship.
In the U.K., the Government Digital Service team designed, built and ran the GOV.UK “alpha” site in 10 weeks. In Washington, D.C., the U.S. Digital Service’s goal is to ship a minimum viable product within, at most, three months of a project’s initiation. Both the U.S. and U.K.’s digital government departments have published digital design guidelines that are simpler and more sophisticated than many commercial organizations have managed.
We’re also seeing a rise in private digital citizenry, where technology enables social good. In the case of the recent Syrian refugee crisis, Berlin-based Refugees Welcome, described as the “Airbnb for refugees,” has helped refugees from Syria, Afghanistan, Burkina Faso, Mali, Nigeria, Pakistan and Somalia. So far it has allowed 26 German citizens to invite refugees into their private homes.
Mobile Justice is a mobile app responding to the rising awareness of race-driven conflict with police in the U.S., resulting in the #BlackLivesMatter movement. The app has a simple feature allowing smartphone owners to send video footage directly to the American Civil Liberties Union – all with the simple shake of a phone. The ACLU then systematically reviews it for potential legal action.
New services are rising in response to the concerns around privacy. iRights, an initiative that focuses on the rights of children and young people, sets out a universal framework of digital rights, including the right to easily edit or remove all content they have created.
Instances like the U.K. announcing that providers have to keep user’s web logs for 12 months make us pause and consider what would happen with a less benign administration.
Yet, technology has also paved the way for governments and the private sector to solve major challenges together. The White House brought together the U.N. Refugee Agency and Kickstarter, known for crowdfunding creative projects, to raise money for the Syrian relief effort. The weeklong partnership raised nearly $1.8 million, which can be used to provide necessities and a place to sleep for more than 7,000 people in need.
When government is not reacting quickly enough, the private sector will deliver digital platforms. F6S is a social innovation forum for startups, advisors and investors, and enables people globally to apply to accelerators, pitch investment funds, and post or apply for jobs.
The focus of public service design will be vastly different for more established, democratic governments like the U.S. and U.K., which will focus on the quality of design output. Countries like Dubai and Singapore are making more radical statements with technology.
Governments should use simple language focused on content, structure, navigation, grouping and completion. Sweden, for example, has legislation that requires all government communications to meet plain language standards.
Too many government services, tools and processes are opaque and cumbersome. Immigration, making a tax submission, dealing with a law suit, deciding on child care after parents have separated, adopting a child – these are very important but also anxious experiences for most. All the more critical that governments bring humanity back into their interaction with citizens.
Utilize a research-led approach to generate rich insights that can then be used to spark innovations. By considering the entire ecosystem, and using research to uncover insights, service design reveals an outside-in view of:
Measuring our wellness is opening a new stream of revenue for an unexpected beneficiary – individuals. We live in an era of flat incomes, uncertain job prospects and rising healthcare costs. The confluence of these factors is creating a new set of currencies that may actually be worth money: health data. There are a few key elements that caused the trend to emerge: Consumers are using health monitoring for both leisure and preventative care, technology innovation has decreased these former costs significantly, but conversely rising health costs overall have created a critical moment in the market.
Now, self-monitoring is no longer reserved for a small, tech-savvy customer segment. As the speed of innovation increases, cost of health tech has decreased; a large contingent are now priced under $100, from the Fitbit Zip and Jawbone UP MOVE. The market for wearable health trackers is expected to grow 600 percent by 2019. It’s not only about health and wellness devices becoming cheaper, but features are also commonly bundled – at no extra cost – with gadgets like smartphones (running app, step counter features) or smartwatches.
Health is no longer a complex cost managed by a closed set of entrenched players. It is now something we can all keep track of, learn from and reward. And other industries are asking themselves – is this somewhere we can play?
In the financial services sector, John Hancock, an American insurance firm, created an Apple Watch app where customers can record their activities and earn up to a 15 percent discount on their annual premium based on healthy patterns of behavior. Cigna released a pilot program in 2014 by giving BodyMedia (acquired by Jawbone), a wearable-based body monitoring system, to thousands of employees. Results showed that employees at high risk of contracting diabetes have improved their risk profiles since the pilot was launched.
The Oscar health insurance company started supplying customers with a Misﬁt Flash and oﬀered users a $1 credit every time they hit their step goal, with rewards in Amazon vouchers of up to $240 a year. Not only do rewards decrease premiums for customers – it also generates loyalty and commitment to the provider.
In Australia, Medibank (a health insurer) and flybuys (a loyalty program) give customers points for providing their fitness data and for making healthy decisions. The partnership explicitly suggests the use of a tracker. Notably, flybuys links a major retailer, a telco and an airline, among others.
Now, data is the newest fitness accessory. But this will have the effect of turning fitness into wellness – a much bigger opportunity. The consumer market is now very comfortable with the practice and progression of self-monitoring. We’re starting to see the consumerization of healthcare. In the healthcare industry, this trend translates into a “beyond the pill” strategy.
The impact from this cocktail of self-serve devices and data is emphatic. It allows us to be proactive about preventative care and positive behavioral change, facilitate more productive and timely interactions with healthcare practitioners and also minimize avoidable and costly healthcare emergencies.
We are seeing the emergence of medical approaches like precision medicine, which tailors treatments to an individual’s lifestyle and genetic profile, saving costs and improving people’s overall quality of life. The initiative, announced by U.S. President Barack Obama, hopes to enable “a new era of medicine in which researchers, providers and patients work together to develop individualized care.”
What would they be? What partnerships do you need to deliver such a vision? Companies like Kaiser Permanente and Aetna are opening their platforms to third parties to enable them to build new services on top of their data connecting third-party wearables, apps, and services.
The emphasis is changing from product-focus to outcome-focus. Pharma companies are now taking to heart the idea that in every product there is a service waiting to get out, which means integrating a holistic service offering providing added value through digital services like telehealth, wellness programs, connected devices and smart pills. They will also have to invest in consumer-facing brand development.
On the employer side, companies across all industries can tap into the nearly $2 trillion in health savings that can be realized through this kind of guided behavioral change. Examples of this are data-powered companies like Vitality, Castlight Health and HealthSparq. Under the U.S. Affordable Care Act, employers can give their employees up to a 30 percent discount on insurance premiums for participating in company wellness programs.
To rebuild healthcare in a sustainable way, a new mindset is needed. The customer journey has to be rebuilt from the ground moving the “point of care” (or as we might say, experience) from costly hospitals to the patient’s home and the “level of care” from specialized care to new levels of empowered self-service.
No longer a vision of the far-flung future, virtual reality will make its mainstream debut in 2016. Not too long ago, VR was a technology so bulky and expensive that it was relegated to military flight simulations. Fast forward to 2016, the “critical year for virtual reality,” as Sony, Oculus, and Samsung will release consumer versions of their products in the first half of the year.
Marketed as the next step for gamers, Oculus Rift and competing VR products will feature their own platforms and accessories. Believe it or not, VR is about to become a really big business.
VR will obviously offer the next dimension in gaming, but it’s the unexpected applications that we at Fjord are intrigued by. From education to tourism to health, VR will begin finding its place in our work, play and homes.
Companies are mobilizing for VR, and many consumers are poised to acquire one of the anticipated devices available in early 2016 like the Oculus Rift. Samsung released its Gear VR at the end of 2015, at a low entry point of $99, Sony plans on releasing its own VR headset in 2016, and Microsoft has released the HoloLens to developers already.
Companies are creating platforms for experimentation with the technology. Most notable is Google Cardboard, a universally affordable system for mounting a smartphone inside a DIY cardboard headset that creates a personal VR system. The New York Times gave away over a million Google Cardboard kits to introduce the first of a series of VR films. Nokia OZO is a VR camera created specifically for professional content creators.
VR as an educational tool will also see a big lift in 2016. Google announced that schools in 12 U.S. cities and three in Canada, Denmark and Singapore will get kits outfitted with everything to take their kids on VR field trips.
For businesses, VR will likely impact processes. One clear influence VR will have is on how we meet and collaborate. AltspaceVR is a means of using VR to meet and connect with others in a virtual space. Beyond enhancing how we collaborate, there will also be new ways to enhance individual productivity.
In 2016, early adopters will give VR technology a try in their homes and workplaces. New movie formats will likely emerge as well as services to create them, such as the Oculus Story Studio, a team that focuses on developing new methods and techniques for VR movies. We will also keep seeing new peripherals being introduced, such as the Oculus touch, Google Cardboard’s Jump camera rig and other motion-sensing devices designed to enhance the VR experience.
From virtual tourism to immersive journalism to exposure therapy, VR can change many industries beyond gaming. The question will not be if, but how and when VR will impact business processes and customer experiences.
In order to look into the future, sometimes you must look back. Technology like augmented reality has been in the market longer than VR. Take for instance, the Blippar app, which brings ordinary objects and posters to life with an augmented layer. QR codes are yet another precursor to the VR wave that’s about to emerge. As designers, we instinctively rebel and recoil against QR’s visual clutter. But in the Asia-Pacific region, QR codes work surprisingly well at a mass level. What it does well is signal to the user that an AR layer exists, albeit in an ugly manner. Will AR and VR merge to create an entirely new experience?
We expect that VR, regardless of the delivery method, will start to enhance and extend many industries and services. The key will be to identify VR’s place in your business.
Oculus, Sony, OZO or Samsung Gear? It may be difficult to know where to start with VR, but we believe that market leaders will take the view that anywhere is better than nowhere. Google Cardboard makes it easy to obtain a low-cost initial experience with VR.
Many of us know the challenges of having an organization that mirrors a device ecosystem. As new technologies such as VR emerge, resist the urge to create a specialized team only dedicated to that device. Instead, think about how the overall user or business process should be supported by the technology, and they’ll work together with a unified, device-agnostic team.
It will be crucial for businesses to understand how the technology can be used for business processes as well as customers. Will VR conference calls be more productive? Can travel be eliminated or scaled back, in favor of virtual collaboration? Can you work on-site, while staying off-site?
Thanks to the digitization of everything, we now have the most hyperreactive markets in history. However, innovation at this speed comes with an unintended consequence – a never-ending glut of options. From more than a million apps in the Apple Store to your grocery’s milk aisle, every aspect of our lives now requires making a choice.
It is becoming increasingly difficult for consumers to make sense of all the noise. An increased demand for decision-making takes a physical, mental and emotional toll, yet we’ve continued to demand more attention, decision-making and interactions from people throughout the day.
One of the more startling revelations of recent years is that people are more likely to make poor decisions, be less satisfied, and switch off entirely when confronted with the burden of increased choice.
Hence, the desire for people to take things off the “thinking list.”
Consider this – the average person makes more than 200 decisions a day on food alone. Aldi built a successful and disruptive business model while offering significantly fewer choices than traditional supermarkets. When Proctor & Gamble cut its Head & Shoulders line from 26 products to 15, the organization saw a 10 percent increase in sales.
How can we find better ways to identify and deliver what people need, while reducing the thinking required to fulfil their needs and goals? A strong example is Amazon’s innovative Dash Button. The first-mover brands that secure real estate in the home have effectively shortened the purchase decision funnel into a straight shot of brand loyalty.
Digitally-powered box subscriptions offer curated surprises and take the chore of choice out of the equation. The thrill of unboxing is part of the attraction, where presentation and personal touches like handwritten notes are part of the experience. These subscriptions target some of the most crowded and confusing spaces. Powell’s Books deliver hand-picked books, Bitsbox teaches kids to code, and your dog gets in on the action with BarkBox. And “freemium” apps like Evernote, Spotify and Dropbox offer enhanced services over their base services with paid elite or premium memberships, which can be significant sources of income.
Data is the engine for these subscriptions that tick off our “thinking lists.”
Services that are able to anticipate needs by not only providing personalized messages and suggested options, but automating low-maintenance decisions, will be an important step. We’re already starting to see this with Google Now, while Australian startup Pocketbook prompts users of their upcoming payments and bills to avoid missed payments. For choices and decisions that require greater knowledge of a product or a clearer articulation of the consequences and outcomes of any given choice, expertise (human or digital) and well thought out design will be required.
IFTTT is a service that allows users to create custom connections between their apps and digital utilities. For instance, you can add Alexa notes automatically to Evernote. IFTTT was valued at $200-plus million in 2014. Need further proof of the need for simplification? IFTTT users are now creating about 20 million shortcuts each day, organized across more than 170 public channels.
Think of ways to help your consumer stop browsing. Find the things they like and don’t know about. And get it right. For example, the point of a snack subscription like Graze is not to be a grocery store to order from, but a service that does the selection for you.
Gestural, environmental or ambient interactions are able to interpret an input and provide a response that is available when needed, and not demanding when it’s not. Traditional push/pull interactions typically require a user’s attention, decision-making ability and learned behavior.
When engaging with customers in scenarios where they need to choose, coach and teach them how to choose by introducing simple or limited choices before moving progressively through complexity.
There are also other ways to simplify: algorithms and expert curation. We don’t necessarily want a music service to clean up its music to just the most popular. Bottom line: While simplification wins, don’t oversimplify and sacrifice thrill of discovery.
The average lifespan of an S&P company has gone from 67 years in the 1920s today to just 15 years today. The pressure to innovate has never been stronger. In 2014, $1.6 trillion was spent in R&D globally. Yet, in consumer goods, for example, research shows that more than 85 percent of the products fail.
As a result, we’ve seen corporations invest directly in business incubators and innovation labs, bringing design thinking and problem solving in-house. It’s almost become the price of entry in the consulting and financial industries, with the recent acquisitions of Adaptive Path by Capital One, Spring Studio by BBVA, and Designit by Wipro Digital. Why?
Arguably it’s harder than ever to gain sustainable differentiation from technology and business-focused innovation alone. Culture – as experienced through design-led innovation – may be the best way to claim sustainable territory, because it is so much harder to copy.
More of our clients are asking us to set up design studios in collaboration with them. We asked our studios how their clients are handling design within large organizations. The conclusion? There is no one consistent solution clients are applying. In particular, the most asked question is, “Where does design sit? With the CIO, CMO or elsewhere? Or even as a separate unit?”
Since 2009, six major US banks have made strategic investments in 30 fintech startups, ranging from emergent payment technologies, data analytics, personal finance and P2P lending. In retail, Wal-Mart, Staples and Zappos have all gone through successful innovation initiatives. In pharmacy and health, CVS Health has just opened its innovation hub in Boston, which is providing a learning framework for startups.
Corporations are finding that innovation can be extremely elusive. Fostering demands a new approach to business, where empathy is established with users, models are created to examine complex problems and failure is tolerated, even celebrated at times. This is an approach where design is in the doing.
We’re seeing the emergence of design-led thought leadership. eBay brought in John Maeda as a chairman of its newly formed design advisory board. The company now proudly promotes design as part of its DNA. In 2012, PepsiCo hired its first Chief Design Officer, Mauro Porcini, who oversees design-led innovation across all company’s brands.
MassMutual set out to tap into the millennial market with its product offerings. The result was “Society of Grownups,” a true omni-channel financial planning master’s program for adults. The business platform features a digital and online offering focused on financial literacy, as well as a physical location with a classroom, check-up booth, library and café. The approach was truly disruptive, requiring a new brand and service structure.
For many companies, the journey toward design maturity carries two main challenges: process integration and scale. Integrating designers within a mature corporation is a very different matter than adding a vertical capacity. People from the leadership level will need to help spearhead initiatives of this scale.
For some companies it will make sense to integrate design throughout the organization, while others might see the value of its integration only in consumer-facing units. In the end, it will not matter “where,” but “how.”
Ultimately the success formula will lie in the execution, and in such a volatile ecosystem, this will mean embracing a human-centric approach to design across the board.
It behooves us to take an existential step back and ask ourselves: As design moves in-house, what will the implications be for our very own future, as Fjord? We (and our clients) still see the strong need for non-industry-aligned partners to be nimble problem solvers and thought leaders, especially since the pace of change in today’s climate is so incredibly fast.
Consider having C-level support, pilots and MVPs use a common language for design. Drive conversations from principles and bridge organizational silos. Encourage collaboration and co-creation workshops.
Obviously, it depends on the business but the central number in an in-house design “swat” team seems to be around 30. The important part is having the right mix of players. Hire change agents and create the conditions for them to thrive. Make sure they are nimble at facilitation, concepting, prototyping and experimentation. Cultivate a great culture.
Be wary of the temptation to have a totally separate design/UX team. It may be better to build small groups into the existing organization, alongside design-savvy product owners.
Create spaces where design can thrive and foster creativity in everyone. Make places where the walls become the workspaces and everyone sees the collective progress being made.