Software company in the physical world
Looking beyond the physical product to unlock an ecosystem of digital/physical data, and connecting the dots to imagine the next generation of the user experience and business models.
We see more and more physical product and service companies becoming software platforms. GM has a goal of increasing its revenue share from software and services to %50 of its total revenue. They are looking beyond developing and selling cars and focusing on their CX, which is anytime their consumers interact with their brand outside of just driving their cars. This includes shopping, servicing, time spent charging/refueling, connecting their cars to other platforms, and selling/trading. Multiply this with data coming from 300 sensors in every connected car and the time that will need to be repurposed when cars get better at Autonomous Driving, there is a big paradigm shift in a car’s purpose in people’s lives, and there are endless possibilities for new experience and business opportunities.
“With broader adoption of Autonomous Driving, there is a big paradigm shift in a car’s purpose in people’s lives, and there are endless possibilities for new experience and business opportunities.”
I see a similar thing happening with built spaces, in which hotels will be at the forefront of. During my time with the Design Innovation team at Marriott International, the largest hotel company of the world, we had an amazing start to exploring this with the IOT project to understand what a “connected space” can unlock within the next 5-10 years for a hotel environment. The sensors in the bed, spatial analysis technology, personalized room settings in guests’ profiles, mood/health-based product/service offerings, and more. But there is even more to be explored to get to the real potential and be at the forefront of the paradigm shift for hospitality.
Marriott International Guestroom of the Future. More information here.
In Marriott International’s (MI) case as the largest hotel company of the world, the opportunity learning from the data produced in the physical world is tremendous. No other company/institution has the potential to access anonymous spatial, health, and behavioral data at the levels of ~1M rooms every night. Imagine creating a great user experience that justifies anonymous, secure data sharing (as we all do in the cases of Apple, and Google Maps etc.); now you have an incredible amount of data that can be utilized, for example, in research to mitigate sleep disorders. Imagine tweaking the color temperature of the in-room lights for every room in unnoticeable levels, and seeing its effects on sleep and jet lag prevention firsthand.
“No other company/institution has the potential to access anonymous spatial, health, and behavioral data at the levels of ~1M rooms every night.”
Done right in a dream scenario, that could be what MI is looking at in 5-10 years after the next organic remodel of every room. I haven’t even begun to talk about the CX, personalization, and wellness opportunities for guests at the individual level. It could become the software company that has billions of physical, unbias data entries yearly across every geographical location globally.
The examples of physical world companies starting to utilize behavioral and usage data will only increase as sensors, wearables, and connected products are becoming bigger parts of our daily lives. Next decade will be really interesting to watch which one of those companies will be in the forefront of connecting the physical and digital worlds, and what new business models will come out of it.