innovation

Shelves that gather information

In a recent interview, I questioned the future of marketing as we know it. Less creativity and more math, I said. In fact, I still think those in charge of making a product attractive so that someone will buy it should take into account not just the taste of the customer, but also that of the customer’s refrigerator. What we saw in the movieMinority report is just around the corner: marketing technology ready to track the age and gender of their customers as they pass by. In fact, in the giant supermarket chains like Mondelez, there are already shelves equipped with Microsoft Kinect sensors (popularized by their use in gaming) that can determine the age and gender of the potential buyers walking in front of them.

I believe that online capabilities based on portable devices will be the ones to give us the answer in the future. Whoever will want to sell anything online will have to “convince” a machine. Let’s say that a fridge runs out of cheese, and the fridge itself is in charge of ordering it online; one day this selection will be based on technical or substantial criteria from which software can make decisions. Big-data, algorithms, previous experiences or whatever will determine that the one who buys your cheese won’t be a human, but a machine trapped in its owner’s mobile device.

Despite the fact that Mondelez assures us they that they don’t plan to store the data they gather on individuals, they are starting to manage the aggregated information obtained from cross-referencing all the individual records, hence improving their marketing campaigns, tailoring them to better address specific populations. It’s still no more than a market study, but with a solid change from the established model. It’s clear these sensors are just the tip of the iceberg of something much more complex that surely will interact with smartphones and all sorts of devices in the future. Smart watches, or Google glasses could be the ideal devices to send reports to a platform like the one Mondelez is already setting up in its stores.

It’s analog big data ready to take on the tiniest details. A sensor capable of measuring times and product selections according to their locations, tracking lines of sight and coming up with sophisticated charts on discarded products which will determine new aspects of company marketing.

There are examples that can provide details and give us an idea of the way things are headed — social shopping, group buying or comparison shopping engines, among other things — but I think all that is still light-years away from what’s coming. They are just the edges of something much more transverse and disruptive. It will have to do with the global talent fostered in that environment, with connected ideas that will allow society to get better in its habits of consumption, and will stimulate society to be more intelligent. Those changes will come from a collective marketing intelligence, and through data management systems never seen before. It will make big data look like a preschool toy. Nothing will remain as it is today; the future has already begun.

Let’s imagine a customer picks up an object (the sensor detects which it is) but after some time (the sensor detects how long), puts it back on the shelves. Finally they choose another or simply move on to a different product (the sensor detects that as well). A whole world of data analysis begins at that instant. If on top of that, the customer’s smartphone is open to share information in exchange for receiving deals or something similar, the business will be able to know the customer’s spending patterns and overall tastes. It’s an endless equation but tremendously efficient.

Forbidden Phrases

There are three shunned sentences in my life. “This is the way this has been always done”, “That’s not possible” and, the worst, “Be careful, you’ve never been there”. The first one is typical in discussions on business innovation. The second is typical in economic fields where the parameters outside of conventional logic are not examined. The third refers to going to unknown places to gather momentum and working on projects from the unknown. This last one is especially stimulating to me. To be an entrepreneur is something more than defining an economic model; it has to do more with an attitude and with the will to take control of your own destiny. Is not always doable, but we have an obligation, as a species, to not be annihilated. I only know one way, though there are others; mine is to embark.
Every one of the thousands of entrepreneurs that banish their fears and disregard apparent limitations are the ones that will wake up a sedated society that has idiotized itself to the extreme. The representatives of that anesthetized social body, incapable of facing the challenge of taking control of its own existence, but aware of the fact its life is a socio-economical privilege that no other generation before has enjoyed, I call the “low cost micro-bourgeoisie”.

Starting right now, we are delving into the values of a society that will decide in coming years if this is a “glorious opportunity or a “situation without opportunities. Once a society lets itself be dragged by the tide, then it’s a dead society.

A few years ago, during winter, I used to have the pleasure of giving a lecture to a thousand students from different Andalusian schools of economics in the auditorium of La Cartuja in Seville. They were usually students in their last year. Each year, halfway through the talk I asked the same question:

How many of you intend to undertake something — a project, a business, or whatever — within the next five years? Their response was worse every year. Normally, barely a dozen students would raise their hands. Then I came back at them with another question:

- So, How many of you want to become public servants?

More hands go up, but it still isn’t exactly a forest of arms I see in front of me. Finally I pose the question to the rest (which is well over half of the students left) whether they want to be prostitutes, arms dealers, contestants on Big Brother, or football players. The laughter that usually creates leaves me speechless.

It’s not their fault; the fault belongs to the environment we have created which numbs the desire to get moving. Life seems to be extremely easy these days and the middle class lifestyle has become so accessible that you don’t even actually need to be middle class to enjoy it. Unbridled consumerism does not require having money; all you need is someone to lend it to you.

At the end of that annual conference in Seville, five or six students would approach me at the end. On one memorable occasion, a girl walked towards me with tears in her eyes, extremely moved. She told me that she was one of the few that understood me; that she was now looking forward to take “the reins of her own existence.” I do not deny that left me with my face twisted, unable to respond. It just so happens that it’s necessary to address and act on the problem: the passivity of a society that takes sleeping pills before starting up each morning to numb away criticism towards anything that surrounds it, and with much less ability than those previous societies that passed down to us most of the privileges we now enjoy and manage so badly.

For the first time since World War II, this new batch of youngsters will live worse than their parents. Spurious improvements in travel, higher education and media have generated an illusory sense of wealth for contemporary young people, as it arises from a model of parasitic dependency on one’s family. The number of young people in Spain that enjoy full economic independence decreased from 26% in 2004, to 11%  2011, and that tendency is spreading throughout Europe. When these students mature and enter the labor market they are only going to find temp jobs for the rest of their days. They are people who could enter the labor market at age 35 and then face being laid off at 50.

Ecommerce in Mobile Devices

These days I’ve been in the Americas.  From Miami to Santiago, Chile, I’ve been passing through Colombia, Ecuador, Panama and Mexico.  In each of these places, we’re presenting our new betas from the first pool of products to come from IDODI Labs. In this first chapter, we are looking to enter into the global market, without pretensions and without a great deal of noise since in the coming months what we will be trying to do is learn from the user’s experiences, obtain reliable measurements and take care of all the improvements and necessary steps to achieve our final objective: simplify, automate, and perfect this type of ecommerce SaaS. The first thing we’ve discovered is the importance of providing answers on mobile devices and the urgency of focusing on that area. In the next couple of months we will have working versions of the apps decidedly geared to be sold.
Mobile devices have truly brought about an extreme revolution in human relations, communications, purchasing habits and information. It is here in the Americas, particularly in Latin America, where a giant risky leap is being taken between applications and devices. Meanwhile in Europe, and even in the United States, you must first have a product available in a fixed format or bound to a traditional support, and in these countries the use of the mobile device is provided before any SaaS subject to a static platform. It’s incredible how if you want to grab a considerable market share, you have to submit to this formula.

According to the Path to Purchase study carried out by the prestigious call measurement provider Telmetrics, today 46% of users start the purchasing process on their mobile device, even if they end up finishing the purchase offline or on a different device.

One of the things that has surprised me the most, and that in the last few months has become a work obsession at IDODI, is that even though users resort to their smart phones to begin a purchase if they are away from home, when they return home they continue or complete the process with their tablet. All this is to say that even though the purchase may be offline, the actual gateway to your sales is built on the effective fusion of your marketing on various devices. Specifically, the study indicates that 74% of searches begun on a mobile device are completed offline, whereas 54% of purchases whose search originated on a tablet were finalized online, either on a PC or mobile device.

One of the principal conclusions that arises from this study is that clients have been using multiple devices for some time now, and because of that it is important to provide an integrated experience, to facilitate access to information and to promote conversation through various conduits. I leave you with one of the graphics that accompanies the study which really helps to clarify things.

 

20130502112136

 

Ireland and the New Economy

When I lived in London I could already tell, but it wasn’t until living in Dublin that I really noticed I’m paying more taxes. I’m paying as well the demanding ones from other countries where I have commercial, personal, or corporate activity, but in Ireland all kinds of personal taxes are higher. Apart from the tax code, what matters is how the country and its rulers decide to stimulate the economy or change the economic growth model. Ireland did both a few years ago and now they are seeing the results.
Just dealing with the tax issue alone won’t shed light on the whole story. In Ireland, new and extraordinary things are transpiring which means a significant jump is taking place in the perception that the rest of the world has of Dublin, as well as of the rest of Ireland, which is becoming a technology industry hub with massive potential. Whether this started as a tax issue or not is now irrelevant, because the truth is that the large companies of the world in the technological vanguard are already here, and not just with a minor trade office, or a legal representative. We’re talking about more than a hundred thousand people working for Google, Apple, Ebay, Amazon, Cisco, Crompton Greaves, GSK, IBM, Intel, Merck, Microsoft, Siemens and IDODI (allow me to take the liberty). Moreover, we are not just talking about one city, but a whole national ecosystem adapting itself to all things digital. Galway, Cork, Limerick and Sligo, as well as Dublin, make up a format similar to California’s Silicon Valley. It has nothing to do with other places that try to label themselves as such. Every time a geographical area wants to “modernize” its economy, it tries to associate itself with that Californian image, but calling yourself Caesar doesn’t make you Emperor.

It’s true that the European bailout of the Irish economy will bring unpleasant consequences in coming years. Public investment will drop, there will be enormous pressure on the management of government aid, and attacks on their taxation system will be planned. Nevertheless, the journey has already started and it’s important for other places to take into account how and what they decided to change to get to their economic standards to attract technological talent. In Ireland, everybody is getting ready. Far from opposing the changes, many of the main corporations have decided to adapt. For example, the Facebook’s Dublin office is also its international headquarters and it has acted for many years as the monitor for the entire community of Facebook users outside of the United States. In fact, it is within the very heart of this Dublin office where the social network has created the Data Protection and Privacy Council, which is precisely in charge of assuring the privacy and security of the people using Facebook in the European Union. It’s known that in coming months there will be changes and the exceptional tax policy currently in place will be modified which will put Ireland in a less than ideal spot, but I doubt that all that has been created and built to date can be undone magically.

There are stereotypes that need to be revised. Currently it’s easier to set up a new company in Spain than in Ireland. The island has a lot of complications and many defects in their legal procedures which demand surprising analogical verifications (whoever says the opposite hasn’t tried starting anything here). But it offers a fiscal framework that promotes a certain business model. Ireland’s corporate tax rate stands at 12,50% of profits, they have a tax policy that grants a credit of 20% on the increase in expenditure on R & D incurred by a business which is independent of the deductions to which they are entitled for this expenditure. It was imposed nearly three decades ago and it has already been a few years that it represents an important factor in the GDP of the country. It’s not a new thing and isn’t anecdotal; it is structural and survives over time.

The opening up to technological intelligence is brutal and can be noted in the day to day. Tremendous tests of selection, with engineers monitoring on a screen what is happening on yours while you try to find out a system password in a quarter of an hour, or while you try to incorporate improvements into a code to simplify a process—these are just examples of what is happening. Now it isn’t so much the search for entrepreneurs as the certainty that the talent generated by the greatest will attract the first ones. I know Spanish university professors that have not been able to pass the tests of large companies there. The search for talent is to levels that I had only seen in Silicon Valley a few years ago. It’s fascinating and very competitive.

Ireland is a small country definitively focused on promoting the development of its technology industry and approaching it from many fields and modes. To give an example, there are currently more than six thousand jobs available in this industry, and a huge interest in promoting the immigration of highly qualified workers. This is the way to condition and prepare a country for a competitive future in the framework of the New Economy. It’s normal for criticism to intensify when one looks at their taxation system, but it’s a mistake to stop there because it doesn’t allow you to view where they are going with “modernizing the economy” or “changing the growth model”. Let’s take into account what other countries such as Spain are doing and what you get with that. It’s not that difficult, you only have to put yourself to it. Creating jobs isn’t either, but there is no other way. My team and I, we stay in Dublin.

https://twitter.com/onlyIDODI/status/313713375119032321