Differentiate with smart features
A strategy to differentiate and create more added value by applying digital technologies to the product and making the product smart and connected.
Why consider it?
For some time now, producers of physical products have been forced to differentiate themselves from emerging competitors. Since focusing on product quality or product variants is offering less and less of a competitive advantage, they now have to find other ways to add value to their products.
Over the last five years we have seen a sharp rise in the number of smart connected products, driven by rapidly evolving electronics and ICT technology. Smart connected products combine built-in intelligence (sensors, processors, algorithms) and connectivity to better meet changing user needs.
Increasingly, it is becoming technically and economically feasible to incorporate smart connected technology into products, and various applications are now coming within reach of companies. The basic technology for smart connected products is now more accessible than ever. Microcontrollers, wireless communication modules and sensors are becoming more efficient, greener, smaller and cheaper. Manufacturers offer technology in the form of development boards that can be quickly integrated into a product prototype. Today's open-source hardware and software and growing 'communities' of developers can greatly accelerate product development. ICT integrators and technology providers are offering more and more IoT and cloud platforms for IoT applications and customised solutions. Web and mobile applications can quickly be created from existing platforms and applications.
Smart product strategies increasingly consist of creating added value to boost competitiveness. The time is ripe: smart connected technology is coming well within reach of companies.
What does it involve?
Rolling out smart connected products is not an obvious choice for companies that produce physical products as it involves switching to multi-technology products combining hardware, connectivity and software. As a product manufacturer, you should expand your knowledge and skills with regard to each of these aspects individually and as a combined package. This also involves a different approach to product strategy.
There are three main tactics that producers of physical products can use to differentiate their products from the competition in terms of smart functionality:
- Design for autonomy. Autonomous smart products learn from their own state, the user, the environment and other products and systems, adapting and even optimising their behaviour accordingly. This intelligence can be embedded entirely in the device or, in the case of connected devices, reside in the cloud or arise from dynamic interactions with other connected devices. As well as having autonomous intelligence (being self-steering), products can also be physically autonomous by being self-driven (actuated) and/or self-powered (no physical link to an external power source).
- Design for hyper-personalisation. Companies pursuing this strategy aim to develop either:
- products and services that can learn and adapt automatically and in real time, even in relation to individual users;
- product variants (different geometry, size, built-in functions) to offer a user experience tailored to individual users.
They believe that efficiently offering a new type of personalised experience, based on digital technologies, will create more value for their customers.
- Design for a wearable connected world. Product development is increasingly aligned with mobile connectivity and apps. We are surrounded by wearables and affordable, multi-purpose smart devices such as smartphones, smart watches, smart glasses and trackers. Companies can take advantage of these developments, either by making their own product wearable and connected or by connecting their product to a wearable, connected device that is used as a user interface endpoint or a sensor endpoint.