A number of recent reports have revealed that the future of the technology industry is in the hands of the consumer. How should organisations react?
There are two sides to the evolving tech industry. On one hand, innovative startup founders and other global IT leaders are pushing development forward with the products they create and market. On the other, consumer demands are dictating the devices and apps that companies focus their energies on.
A number of recent reports have focused on the influence of this second point, as trends such as social media put power in the hands of the consumer. While there is a balance between these two industry influences, the fact that the purchasing power lies with consumers will continue to define the way new devices and apps evolve.
What do consumers want in 2016?
Communications provider Ericsson investigated the way consumers want technology to evolve throughout 2016, finding that there could be significant disruption in terms of the devices people use and the number of daily tasks which go digital.
In fact, even one of the most important devices in the tech world isn’t safe from change. Ericsson discovered that half of all current smartphone owners believe these devices will no longer be relevant in the next five years as replacements are developed.
At this stage, wearables are the biggest rival of smartphones. As apps and other complementary goods and services are created for these devices, consumer interest is likely to grow, meaning IT candidates who are able to prepare for this growth stand a good chance of profiting from the eventual wearables boom.
Head of Research at Ericsson ConsumerLab Michael Björn noted that a few of the trends the organisation uncovered may seem futuristic now, but these speculative demands can provide valuable direction for companies looking to discover the next must-have device or app.
“Consumer interest in new interaction paradigms such as AI and virtual reality (VR), as well as in embedding the internet in the walls of homes or even in our bodies, is quite strong,” he noted.
“This means we could soon see new consumer product categories appearing – and whole industries transforming – to accommodate this development.”
As if people weren’t attached to their devices enough as it stands, many are supporting technology that would take the relationship people have with this technology to a much higher level. Ericsson found that 80 per cent of survey respondents would welcome devices that can enhance their senses and memory.
How can organisations respond?
As is the case with most IT trends, the key for organisations is to focus on the role people play in these processes, not just the technology itself.
Thanks to rising enterprise social media use, businesses have more opportunity than ever before to foster consumer engagement with their brand. According to McKinsey & Company, some organisations are even turning to crowdsourcing product ideas, allowing consumers to have a greater influence over the goods they buy.
The consultancy believes emerging technology trends such as 3D printing are the key to these campaigns, as they allow companies to engage in rapid prototyping or low-volume production runs in a more cost-effective manner.
McKinsey & Company also discovered that social media has a notable influence on consumer purchasing habits, with more than a quarter of all transactions influenced by activity on these websites.
The organisation is keen to point out that businesses can’t afford to ignore the activity of their customers on these platforms, and need to treat these interactions like a conversation. Those that understand the value of social media engagement to the development of their products and services are in the best position to evolve with their customer base.
However, technology will still play an important role in the future success of the country’s businesses, provided that adapt the attitudes necessary to make the most out of these investments. McKinsey & Company noted that organisations should be using technology to differentiate their offerings from that of their competitor’s, creating a valuable point of difference.
Wearables set for short-term success
With Ericsson reporting that half of all smartphone users believe the devices are on the endangered technology list, something will need to rise to take its place. According to a recent report from IDC, this is most likely to be wearable technology, with fitness trackers, smartwatches and other devices all tipped to lead this sector.
While IDC is reporting a range of developing wearable technologies such as smartclothing and “hearables”, it’s smartwatches that will have the most notable impact over the next five years.
Research Manager for IDC’s Wearables team Ramon Llamas believes their rapid rise to prominence will continue over time.
“In a short amount of time, smartwatches have evolved from being extensions of the smartphone to wearable computers capable of communications, notifications, applications, and numerous other functionalities,” he explained.
“The smartwatch we have today will look nothing like the smartwatch we will see in the future. Cellular connectivity, health sensors, not to mention the explosive third-party application market all stand to change the game and will raise both the appeal and value of the market going forward.”
As these trends continue to develop, organisations will need pay particular attention to consumer demands and how they can ensure their products evolve with them.