2018: the year data delivers
2018 is set to be the year data finally delivers for both businesses and consumers. Alex Comyn, chief strategy officer at Amaze, explores 8 key trends that are set to impact on brands next year.
Throughout 2017 we’ve seen the use of data starting to come together to assist both consumers and businesses, especially across voice and gesture control. 2018 is set to be the year data finally delivers. But what are the implications for brands?
Assistance comes of age
The rise in voice and gesture technologies and arrival of affordable smart home devices is set to rapidly change consumer habits and expectations in 2018 and beyond.
Devices such as Amazon Echo and Google Home will provide opportunities to use voice control across an even greater number of experiences and services including banking, entertainment and retail. Consumers will be recognised the moment they arrive at any given touch point, giving brands the opportunity to offer a personalised and commerce enabled experience.
The most commercially interesting change we can expect is the arrival of proactive recommendations based on previous behaviour and shopping history (cue gifting recommendations and holiday ideas). This voice equivalent of one-click commerce will force changes in Google, Apple and Facebook’s business models as they run to keep up with Amazon’s capability for Prime subscribers who use Alexa.
This is going to be a change from the search experiences we’ve grown used to in the last 15 years, so be prepared for some innovative thinking.
We will also see more hybrid apps emerge that combine voice search with bot and human based support depending on the use case. Customer service organisations will need to get used to mining data from all customer touch points and using it to resolve issues and critically to grow customer spend on loyalty by offering super-relevant recommendations.
Gesture control will evolve to include facial recognition and the ability to register emotional responses. Brands will not only know who people are, but they’ll also be able to read their facial responses to brand interactions. If the user frowns, brands will read this and be able to do something about it. If the user smiles, brands will be able to record it on their dashboard so they can recreate the good experience again in future.
This trend will evolve beyond the personalisation of content and communications, and start changing the design of physical and digital interfaces. For example, when a device or AI platform recognises the user, it will adapt the appearance or behaviour of its interface to accommodate the user, their environment, mood or past interactions.
More subscriptions, less advertising
In 2017 we saw the continued growth of subscription-based services, bolstering the current trend towards access rather than ownership. We believe this trend will continue to gain pace, impacting marketing strategies and business models.
In the entertainment and news industries, the growth of no-ad models and paywalls - as seen from Netflix, Amazon, Spotify, Apple Music and The Times - will narrow opportunities for traditional advertising, particularly for a more affluent audience who can pay to avoid the ad-free tiers of these services and brands that currently spend money on advertising will be forced to find a new way to do business.
Open Banking is here but are we ready to share?
In 2018, a new piece of legislation called the revised Directive on Payment Services (PSD2) will come into effect throughout Europe. It forces banks to offer open access to customer data, with consent, from next year. It is designed to encourage competition and switching between lenders, but what does this mean in practice? To start, an influx of innovative new FinTech companies will emerge, promising to make managing money easier. Users will be able to see information about all their bank accounts and finances in one place.
Data processing and smart algorithms will be able to aggregate spending habits, spot trends, make suggestions - and even recommend competitor products. However, one of the main challenges to this is that two-thirds of consumers in the UK won’t share their data and are naturally risk averse. It will be interesting to see how this unravels this year and its implications on the banking industry.
Analytics finally get proactive
Advancements in analytics technology, in particular in the areas of automation and AI technologies are making it easier for the marketer to take control of their data assets outside of IT. Analytics Intelligence is the first stage of AI baked directly into Google Analytics. It gives the ability for any user to ask a simple question of their data – whilst getting an immediate answer “How is month on month traffic from Nov – Dec in 2017?’
So rather than spend half their time answering basic analytics questions for other people in their organisation, analysts should be able to have their time freed up to focus their energies on the higher-value aspects of their roles. Furthermore, I think we will see a rise in organisations needing support in managing this challenge and not just for Web Analytics data, but all data points where there’s an opportunity to connect it all together.
The future is Headless
The web content market isn't what it used to be. Big, enterprise-grade systems with large license costs and lead times will fall quickly out of favour. Instead prepare to see a turn toward lighter-weight, headless platforms that support agility, nimble development and that ultimately support the “value return” by focusing on the applications that generate revenue and not the CMS implementation.
With almost every conceivable product of worth these days being Cloud-first and having a flexible API, traditional integration challenges are being minimised. This should open up budget to invest in exciting, emerging technologies, which drive efficiencies and produce real value, for example AI and machine learning, conversational bots and virtual assistants, automated campaigns and optimisation programmes and adaptive personalised sites …
Less coding, more collaboration
'Model-based software engineering' doesn't sound like the sort of thing that might grab the attention of user-centred designers, but it's actually been doing just that throughout 2017. Not so much buzz as low hum. Developers will be able to solve problems more holistically, avoiding the "can't see the wood for the trees" dynamic of being up to their guts in code as they work through the requirements of the software. The implications for UX are obvious. Rather than merely specifying the functional and experiential behaviour of the end product software, the UX team in a model-based workflow needs full input into how the model itself is built and instructed.
Expect 2018 to be a year in which this type of approach to developing digital products will continue to gain greater attention and affect the way we organise ourselves.
The shifting shape of online sales
Since Amazon exported ‘Holiday’ sales to the UK in 2010 they’ve grown aggressively with more and more retailers getting on-board, sales windows widening and discounts growing. Christmas came very early this year, with some retailers starting sales as early as September and many others starting to discount before Black Friday triggering a race to the bottom. Market research firm Senex reported that Walmart tied Amazon for first place in the five-day Black Friday week race, with each selling to 53% of US shoppers online and instore.
A key characteristic of 2018 will almost certainly be inspiration. To win, brands need to get creative and remind the consumer why and how they are different and work even harder to activate the inspired shopper albeit on thinner margins. Expect more exclusives to emerge with retailers and brands partnering to offer unique PR’able concepts that are not available on Amazon, expect to see campaigns focused on ‘recruiting’ customers and expect more innovation to emerge across the board as brands flex their muscles in a bid to reinvigorate the high street and encourage loyalty.
Inspiration commerce comes of age
As we become increasingly addicted to instant communication and visual social media and shopping experiences we can expect to see a rise in brands using more visual strategies to capture consumer attention, gain followers and generate sales.
This less direct form of commerce is on the rise and offers brands a more direct route to consumers before they make a purchase decision. As explored in the previous prediction it offers players (particularly in the fashion, beauty and luxury spaces) the opportunity to generate higher margin sales away from reseller sites and independent of Amazon if they can optimise their experience effectively. Expect to see this trend reach maturity in 2018 earning its place on more and more commerce and marketing plans as an increasing number of brands seek to set themselves apart and limit the damage wrought by discounters and peak sales.