Blogging, podcasting, mobile picturing taking, file swapping – lately you might be forgiven for wondering whether there is any limit to the technology bandwagons consumers will happily jump on. Yet there is method to their madness. In the main, technology has stopped being the calling card of myopic ubergeeks, and become as embedded in average people’s lives as the TV or telephone. Forget applications. It’s all about appliances.
You might remember that infamous comment by Bill Gates who when faced with the reality that Microsoft had missed the biggest technology trend of all, remarked that someone had to make accessing the Internet as simple as a customer picking up a phone and hearing a dialtone. In the past, technology products were sold by reference to processing speed, memory, and storage capacity. But the reason that Apple sold 8.2 million iPods in 2004, and IBM ended up selling its PC business to a Chinese low cost manufacturer, is that the key product differentiators these days are not technical specifications but branding, design and distribution.
While it is easy to point to a hot brand and argue that it made all the difference, figuring out what an existing brand should do to re-invent itself is not so easy. Case in point is Samsung. With profits of $10.8 billion in 2004, and strong growth in flash memory, computer displays and cell phones – the South Korean powerhouse has the mettle to tackle Sony. Yet to do so, it needs to bridge the brand perception gap with the kind of values that are making iPods and Playstations fly off the shelves - fun, simple, cool, and social. Easy to say, not so easy to do. Why? Partly, because brands these days are increasingly co-created by your user base.
In fact – the most interesting trends these days are not those concocted by manufacturers, but rather the unexpected uses consumer invent for themselves. The growing install base of MP3 players, broadband connected PCs and mobile display devices has become fertile ground for invention, innovation and at times, downright disrespectful adaption. It is like the physical counterpart to the ‘remix’ culture that has already transformed the music business.
Certainly, it is highly unlikely that Apple ever imagined that their customers would end up using their iPods to create and download their own radio shows, that users of the Sony PSP gaming platform would also use it to read RSS news headlines, or that owners of bluetooth mobile phones would delight in transforming them into universal remotes. Game developers call this practice ‘modding’ or ‘hacking’. Consumer electronics manufacturers, on the other hand, are still toying with whether to call their lawyers.
Consumers are more connected than ever before, and in their continuous online mediated discussions of products, they are effectively creating their own focus groups and R&D labs. All this adds up to the ultimate paradox for technology companies. The more technology becomes like an household appliance, the less interesting the underlying hardware becomes. What is compelling, is what people do with it.
Whether it be offering a online marketplace where console game players can trade their own content or just a photo sharing site where users can engage in communities of interest – technology manufacturers need to now embrace and encourage customer product interaction.