Electronics brands are expanding outwards from the home to society, from goods to services and solutions. Conversely, software brands are heading inwards, developing products such as Google Home and Alexa, in addition to smartphone apps connecting home appliances, and cars, so that they can play the role of ‘primary platform’. While technology and innovation are the lifeblood of growth for the hardware businesses in this new context, the cornerstone to success for these brands is understanding the world of customers – the deep penetration of technology and innovation into their daily lives, and into the goods, services and experiences they value.
Successful innovation, therefore, will focus around identifying ‘customer truths’ and leveraging ‘outside in’ perspectives (‘outside in’ because they come from the world outside of a business – customer’s lives, expectations and beliefs). These two approaches should serve as catalysts for innovation, as much if not more so than emergent technologies. As the boundaries between electronics brands and technology brands become ambiguous, electronics brands also need to view themselves differently. To date they have fostered closed connections only with their own branded products, but in the future it will be necessary to act as a connective force, consolidating and leveraging consumer information more broadly and responsively than ever before – including from competitor products.
What’s more, it will be critical to do so without relying on indirect, unintentional and passive means of capture, as the biggest battle in this space – whether B2C or B2B – remains one of trust. Omnichannel touchpoints to intertwine brand experience into the customers’ life will create a stronger bond, both online and offline. Complementary paths to have customers engage in a brand experience should also be sought and maximized, including partnerships with subscription and platform companies.
This category is currently undergoing a radical evolution of its own. Electronics businesses are now evolving to compete with the software behemoths, with an eye on some bold opportunities.
B2C > B2B
By leveraging the brand value nurtured in the B2C context and emergent technological capabilities, leading electronics brands have expanded their businesses into a variety of new arenas including the workplace (Canon, HP, Panasonic), medical devices (Canon, Philips), and mobility (Panasonic). This change has accelerated with the advent of cross-industry, next-generation technologies such as 5G, AI, IoT, sensing, and robotics.
‘Smart City’ solutions are being developed to meet the global social trend toward urbanization. Here all the elements of the city, such as people, energy, and mobility, connect through information and create new value. Philips and Panasonic are making bold moves in this arena.
With 5G soon a reality, there is a steady shift from ‘goods’ to ‘experiences’ or from hardware to software and content. Consider game consoles vs smartphones: the experiences that consoles offer are much more deeply engaging and broad than that offered by smartphones. Sony and Nintendo have the early leader advantage here because, with both hardware and software plus content, they can offer a different level of experience to rivals.
This article is an excerpt from ‘Tech’s Trust Issues’ by Daniel Binns. To read the full article, click here.