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Technology Insights

Technology Insights

Insight | Innovation

In today’s market, innovation is key to brand survival

I think consumers are experiencing innovation fatigue. We’ve become desensitized to change. A TV from just a few years ago will look very old, even if apparently there would have not occurred any major technological shifts. You can’t revolutionize the product every single year, but every year you improve what you have. Although consumers don’t always recognize incremental innovation, brands need to keep innovating. They need to respond to an expressed consumer need, and they must also anticipate needs. Brands will be wrong sometimes, but they need to try. Before the combustion engine and the car, if you’d asked consumers what they wanted, they would have said, a faster horse. The innovation process is about leadership and natural selection.

Carlos Werner

Senior Director, Client Services

Kantar, Consulting Division

Carlos.Werner@kantarconsulting.com

Insight | Social Media

Chinese brand demonstrates new growth model

Innovation is important, but all growth isn’t driven by innovation. I believe there’s a lot to learn from the experience of the Chinese brand Xiaomi, which has become the leading smartphone brand in Spain in a year. That success wasn’t driven by innovation. Xiaomi focused on building a community and partnerships. Its marketing was done almost completely through social media. That’s a different growth model.

Dominic Sunnebo

Business Unit & Commercial Director, Worldpanel Division

Kantar

Dominic.Sunnebo@kantarworldpanel.com

Insight | Trust

Privacy issues expose fragility of trust in brands

The fragility of trust has become apparent with Facebook in the crossfire of a heated and volatile debate. Trust in the brand took a nose dive. The situation prompted more awareness and skepticism among consumers. They thought twice about having Alexa or another device in their homes listening to conversations. When the trust shell cracks it can be devastating because these tech companies know so much about us, and it can open the door for doubt. And related to trust, is the value-exchange model under threat? Apple is good at getting your money directly. Facebook is free and gets its revenue from advertising. Google gets its revenue through advertising and search and from sale of devices. As privacy becomes an issue, does it threaten the monetization model?

Erik Haroldson

SVP, Client Leadership

Kantar

Erik.Haroldson@kantar.com

Insight | Responsibility

Consumers expect their tech brands to act responsibly

Technology brands are under pressure because of consumer privacy concerns and other issues. At the same time, technology brands make important contributions. Many tech brands offer apps or social networking capability related to health and wellness, for example. The balance between consumer concerns and technology as a force for good raises questions. For example, watching videos in moderation is fine but watching them excessively can be a problem. Whose responsibility is it to tell you when you’ve watched enough? How much screen time, is too much screen time? Consumers will be looking more and more to tech and social media brands to have a point of view on this and to act responsibly.

Hannah Walley

Joint Head, Media & Digital UK

Kantar

Hannah.Walley@kantar.com

Insight | Regulations

Tech brands must act responsibly or face regulations

Given what happened with Facebook and the issue of privacy, and Apple taking a strong stand, I would expect the conversation around privacy to continue, and I wouldn’t be surprised to see the US impose regulations, as the Europeans have. The tech leaders are among the strongest companies in the world, and they can be expected to fight against regulation. But the problem is not going away. And unless the tech brands self-regulate, something will be done. The business-to-business brands are less impacted, but they still need to demonstrate a purpose. These kinds of companies use a lot of energy, and a greater responsibility towards the environment will become increasingly important.

James Cook

EVP, Technology

BCW

James.Cook@bcw-global.com

Insight | Innovation

Product, instead of need, drives many tech brands

A lot of tech companies today start with a product, not with a consumer need. They ask, what can we make that’s really cool that I can punt over to marketing to launch? That’s the model for growth. It’s engineering-led. Whether people want the product isn’t the first concern because the tech company thinks the product will change behavior. The reality is that products that change behavior are few and far between. Disruptors and unicorns change behavior.

Jen Hanson

SVP, Client Leadership

Kantar

Jen.Hanson@kantar.com

Insight | Audio

Audio adoption shapes interaction with all devices

There has been a tipping point in the adoption audio. We’ve seen more use of personal assistants. Brands have turned to audio brand signals as media consumption habits are changing. Today our devices—phone, laptop, or TV remote—require typing. But in a few years, we’ll turn on the TV and verbally ask to view a particular show or a menu of shows. The transition to audio will impact not just technology brands, but also the function of advertising on platforms. Brands will need to integrate audio in a consistent way into all their campaigns. Meanwhile, the personal assistant devices are collecting audio information about people’s requests and speech patterns. That data is being used to support other product development related to the Internet of Things. Ultimately, Audio will change not only how we interact with standard connected devices, like TVs, but with devices that are becoming connected in our homes and with our cars.

Kristianne Roberts

Global Development Director

Kantar

Kristanne.Roberts@kantar.com

Insight | Innovation

Defining a brand around its products opens vulnerabilities

Some brands in the tech sector have been built their brands around a strong legacy of delivering great products. Because these are such powerful technology companies, they have been able to bring innovative products to market and those products have been their brand. When those innovations become more iterative, or the innovation cycles become longer, or disruptive brands do the same thing but cheaper, it becomes necessary to define the brand around something other than products. TVs are the obvious example, with yearly improvements in picture quality, but arguably less and less step changes in the core product. But the idea is also relevant to social media brands. How do brands focus on what the consumers want, but not get locked into growth cycles? How do brands respond to these challenges? Do they try to interact with all aspects of people’s lives, including politics? The impact of this shift is underscored by the fact that it even touches the tech category leaders, which historically has done well being about a lifestyle and being in touch with the Zeitgeist.

Mark Webster

Client Director

Kantar

Mark.Webster@kantar.com

Insight | Innovation

More running room remains for tech brand innovation

There is an argument to be made that the technology category is becoming commoditized, that brands need to go beyond functional innovation, making brand differentiation even more important. But I also believe that there is a lot more that brands can do around innovation that they have not yet done. Hardware companies are particularly susceptible to this. Smartphones now are about the number of cameras on the back. Their marketing reminds me of promotions for the number of blades on a razor. A lot of the innovation needs to be how hardware and software merge together with a focus om how this addresses a genuine consumer need.

Nick Snowdon

Director, Brand

Kantar

Nick.Snowdon@kantar.com

Insight | Experience

Brand experience now more important for differentiating

As the technology category matures, it is becoming increasingly difficult to differentiate among some devices. Based on what came out of the Mobile World Congress, for example, smartphone functionality will be pretty much the same. The technology no longer is the differentiator. Smartphones seem to be where laptops were a few years ago. The lack of sufficient differentiation places much more emphasis on the brand and the brand’s ability to drive the price premium. Brands needs to ask themselves: what does the emotive equity behind the brand stand for, and how is the brand experience demonstrably better?

Nick Vincent

Global Head of Data Engineering

Wunderman Commerce

NVincent@salmon.com

Insight | Trust

Habit, switching pain, keep people loyal to ecosystems

We’re seeing the ecosystem effect. It’s difficult to divest yourself from a platform like Facebook or Google, where behavior is just so habitual. The reason for a split would need to be very personal before enough people would overcome their inertia and do something about it. I do think there is a huge over estimation of the degree that people love Apple or other tech brands. I think it’s much more to do with the fact that it feels difficult to disentangle from the ecosystem. In addition, there is no significant alternative to some of these brands. Where do you go if you leave Facebook? But if something new and different came along, you might leave.

Nigel Hollis

Chief Vice President, Chief Global Analyst

Kantar

Nigel.Hollis@kantarmillwardbrown.com

Insight | Trust

People inclined to forgive their digital brands

We have been tracking Facebook and Uber, almost on a daily basis, during this period of consumer concerns with privacy. Despite the daily tremors hitting these brands, their adhesion with the customer is only increasing. I have a hypothesis that consumers are far more forgiving towards digital brands than they are towards legacy brands. And I don’t think the regulators can catch up with them. The regulators focus on visible products and services. They are oblivious to the huge innovation pipelines that the tech giants have built. During the four-year block of 2015 to 2018, the total number of patents filed by any entity increased by 17 percent compared with the previous block of four years, 2011 to 2014. In comparison, the patents filed by FAAMG (Facebook, Apple, Amazon, Microsoft and Google) surged by an astounding 59 percent. This demonstrates the frenzied pace at which the leading tech companies are shifting their landscapes. One-in-four patents filed on cutting-edge technology areas—cloud computing, edge computing, and machine learning—belonged to FAAMG. These brands are building domination in their existing spaces and want to conquer adjacent spaces. The fixed costs of these businesses are low, and their margins are high. That renders these brands extremely agile.

Sanjeev Bhatt

Managing Partner

Mindshare

Sanjeev.Bhatt@mindhshareworld.com

Insight | Society

Public scrutiny blurs contribution made by brands

There has been a year of public scrutiny about the negative aspects of technology. However, we need to acknowledge the enormously positive role technology can play when people’s lives are limited by illness, age, or disability. Among the brands exhibiting at the Consumer Electronics Show in Las Vegas, was a sensor to embed in shoes that would recognize if the wearer fell and then alert emergency services. There was a body brace to help paraplegics walk. As a Japanese brand demonstrated, technology can also help with mental health. The brand exhibited a cuddly robot designed as a comfort for senior citizens. These kinds of innovations, often from smaller brands, demonstrate how technology can be a positive force.

Sara Gourlay