Will all companies become technology companies?
Posted: March 6, 2012 | 14:12 ET by Nick Parish
Last month, Contagious’ North American branch had a fantastic trade show double-dip spanning the course of a week. From Sunday to Tuesday, we were in Detroit, at the North American International Auto Show. Tuesday to Sunday, we were in Las Vegas, at the Consumer Electronics Show.
'How fun!' you must think. Well, not entirely. For those, like myself, with a predisposition towards unfounded abject existential horror, Detroit, Las Vegas, and any massive, hyper-intense halls of commerce inside the same are no places to dwell overlong.
But when I wasn't worrying about the effects of global warming with few electric cars on display, or the planet's jolly march towards the cliff of overconsumption when facing the massive displays constructed from televisions (while flying between destinations in a jet, and eating in fancy restaurants at them) it became abundantly clear: the new ambition, whatever your product, is to not just supply it, and communicate that it's your product, and the best, but also to promote and nurture the overarching themes it may somehow, however obliquely, be connected to.
That’s turned a pair of interesting companies towards technology as the new element underpinning their businesses.
Ford is a great example. We were at the NAIAS as a guest of the company, to see how it's working design innovation into its new vehicle launches, and the debut of its new Ford Fusion. The writing was on the wall, though. Ford is a technology company now. This was the backdrop to every executive sound bite, reinfored by the company going on to CES the day after the auto show launch to promote itself there as well.
This isn't to say Ford is out of the car business, but it's emphasizing the technology powering the automobiles. This can be in the engine, sure, and that's the sort of technology, in terms of newness-to-the-market, that powered the Model T. But it more likely means the sort of technology the customer interacts with, the in-car telematic elements, like Ford's SYNC/MyFordTouch system.
Development of SYNC/MyFordTouch hasn't been perfect. The company was dinged by Consumer Reports, which removed its 'recommended' rating from two cars when reviewers had trouble using the system, which links the GPS, your phone, the radio, the heat, and more, through a touch screen in the middle of the dashboard.
In a sense, the dialogue around automobiles has shifted to where technologic elements of the car are more important than mechanical, ie those are the things that sell the car, but consumer behavior hasn’t. If you’ve ever had to take your car in to the dealership, only to have the mechanic tell you its firmware needs to be updated, and to do it in ten minutes with only a USB stick, you know the sort of confusion we’re talking about here. Is it right to even call the person a mechanic any more? Should he or she be a technologist now?
So, Ford is now in the business of building cars, and servicing them, as well as the electronic and software-based systems that they contain. This is an enormous technical task.
Luckily, it’s shown commitment to the ideas that the crowd may help it shape the future. Partnering with software firm Bug Labs, it’s prototyping a system called OpenXC by which it would open its platform to developers, which could essentially create apps for your car.
Open software development will lessen Ford’s burden in the equation. The other end, on consumers, will force Ford to behave like an electronics community, no longer expecting to be the entire authority when it comes to sharing information and tutorials on how the products operate. Car nuts are naturals at sharing things, though, so the real challenge will be in promoting the best material and marginalizing the bad information.
Hackers and Sneakers
The other surprising evolution towards a technology company came from Nike, which has just released its Nike+ FuelBand, the next evolution of the activity tracking system.
A wristband tracks the proprietary Fuel Points metric, along with steps taken, calories burned, time, and progress toward a goal. The band syncs with a website or a mobile app to help users reach fitness goals. When the product was launched, though, one of our clients at Nike posted the announcement on Facebook, saying “The secret is out. We’re a tech company now.”
This is not a baseless pronouncement. The company has long been in the game of taking the apparel and gear athletes wear and advancing it, incrementally, through design and materials innovation. But the cusp, the thing that changes the discussion, is that the rhetoric around the product is changing to a more analytic description.
“Life is a sport,” the strapline says. “Make it count.”
It no longer matters whether or not you’re an athlete. But dint of living, and being a motive organism that goes to school or work and moves around the universe you’re allied with Nike and its ability to help you put a number against that effort.
The Brand Takeaway
What does this mean for your brand? Well, if you haven’t identified what business you’ll be in five or 10 years from now, there’s a strong chance it’s going to have technological underpinnings. But it could fundamentally be based somewhere else. A candy brand may be about laughter. A pet food brand may be about companionship.
Wherever your brand ultimately decides to play, there’s one important thing to remember. By widening the scope of what your brand stands for, you’re enlarging its competitive set. Nike and Ford must now compete with every other technology brand out there, from interesting messaging to providing superior experiences. Certainly, they’re now in a much more complex, packed environment, and need to deliver above and beyond what they’re accustomed to.
Similarly, they have to keep a much sharper eye out for things that are happening in other industries. The competition is no longer the other automakers or footwear companies. After all, it was Apple that moved into music and phones so well when it realized what sort of jarring effect it could have in those industries.
Will this go away as our infatuation with technology passes through the honeymoon period? Probably. It won’t be too far off before Ford decides, since everyone’s becoming a technology company, that it’s better off talking about its amazing cars. But until we’re all programming our autos with apps we brewed up at home, it’s going to seem extraordinary to have the disruptive forces of the web at our disposal behind the wheel.
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