Keynote for Digitaal Willen We Allemaal conference in the Netherlands sponsored by Tijdschrift voor Marketing and 3MO, at the Museum Beeld en Geluid in Hilversum. 2008.
4. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 4
5. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 5
6. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 6
7. 1960 1970 1980 1990 2000 2010
• 1 terabyte of data (1,000 gigabytes)
• 50 magnetic tape drives
• 25,000 magnetic tapes
• 100 DASD units (~10 GB) distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 7
8. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 8
9. 1960 1970 1980 1990 2000 2010
• 23 pounds • 4 MHZ processor
• $2,000+ US • 65k RAM
• 5” screen • 300 baud modem
• CP/M operating
system distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 9
10. 1960 1970 1980 1990 2000 2010
A >
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 10
11. A > You are in a clearing at the edge of a
small meadow. A farmhouse is nearby. There
is a mailbox here.
A >
1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 11
12. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 12
13. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 13
14. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 14
15. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 15
18. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 18
19. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 19
20. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 20
21. 1960 1970 1980 1990 2000 2010
service product
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 21
22. services will become increasingly
tangible and behave more like
products
products will develop sophisticated
logical service extensions and
behave more like services
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 22
23. Four laws
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 23
24. Sarnoff’s Law
The value of a broadcast network is
proportional to the number of
viewers.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 24
25. television print radio outdoor
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 25
27. Moore’s Law
Computing power increases
exponentially - effectively doubling
every 2 years.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 27
28. hard drive capacity over time
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 28
30. Metcalfe’s Law
The value of a telecommunications
network is proportional to the
square of the number of nodes of
the system.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 30
34. Reed’s Law
The utility of large networks,
particularly social networks, can
scale exponentially with the size of
the network.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 34
35. Late last year the Pew Internet &
American Life Project released a study
revealing that 57 percent of 12- to 17-
year-olds online – 12 million individuals
– are creating content of some sort and
posting it to the Web.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 35
39. if this is your product or
so
service ...
what do you do
with this?
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 39
40. Media and the Internet
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 40
41. television print radio outdoor
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 41
42. Four point five mediums
television print radio outdoor interactive
True Use
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 42
43. "Between now and 2012, broadcast television in the
US will grow at a modest compounded 3.8% to
$58.8 billion.
However, Internet and mobile services will grow at a
compounded 14.1% to $72.3 billion.
Newspapers will continue their decline at a
compounded -2.3%."
Veronis Suhler Stevenson
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 43
44. print radio
television outdoor
interactive
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 44
45. Four mediums and a platform
television print radio outdoor
interactive
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 45
46. traditional media are great at starting the conversation
but very bad at “finishing”
the Internet is extremely good at “finishing”
and “continuing”
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 46
47. The corporate website is not a good use of a platform
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 47
48. = the typical monolithic
corporate website
(www.coke.com)
= the future of
distributed
functionality
Facebook
applications
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 48
49. What can you do with this platform?
Physical products can develop powerful
logical service extensions.
iTunes
Logical services can develop into powerful
and tangible products.
eTrade
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 49
50. Service products
expanding the concept of what services
should be
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 50
51. "78% of US mobile phone users call their
network operator first for mobile phone
customer support problems or questions,"
"However, almost half of all US callers
expressed dissatisfaction regarding
customer service personnel."
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 51
52. ✓ 20,000+ customer service representatives
✓ 25,000,000 calls per month (half of customer
base)
✓ $8-12 per call (let’s use $10)
✓ $250,000,000 per month
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 52
53. $3.25
billion in
support
costs
325 million
calls per
year
Cumulative Calls (in millions) Cumulative Cost (in millions)
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 53
54. crowdsourcing
community based support
distributed participatory support
citizen science
mass collaboration
wisdom of crowds
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 54
55. After all, think about what happens if you
ask a hundred people to run a 100–meter
race, and then average their times.
The average time will not be better than the
time of the fastest runners. It will be worse.
It will be a mediocre time.
But ask a hundred people to answer a
question or solve a problem, and the average
answer will often be at least as good as the
answer of the smartest member.
With most things, the average is mediocrity.
With decision making, it’s often excellence.
You could say it’s as if we’ve been
programmed to be collectively smart.
Suroweiki
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 55
57. The companies – or seekers, in InnoCentive parlance – pay
solvers anywhere from $10,000 to $100,000 per solution.
(They also pay InnoCentive a fee to participate.) Jill
Panetta, InnoCentive’s chief scientific officer, says more
than 30 percent of the problems posted on the site have
been cracked, “which is 30 percent more than would have
been solved using a traditional, in-house approach.”
launched 2001 - founded by Eli Lilly
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 57
59. ✓ if “alternative” cost $500k per month to run
✓ 50,000 calls avoided per month =
breakeven
✓ .2% of a given months call volume
✓ anything over that is cash-flow positive to
carrier
✓ reduce by 3% = $90mm / year savings
✓ or 1500% ROI
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 59
60. $43 million
in avoided
calls
$37 million
ROI
$6 million
program
cost
breakeven in
about 6
months
Alt Cost (in millions) Avoided Call Cost (in millions) Alt ROI (in millions)
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 60
67. ✓ reconsider how you provide service
✓ can you leverage new online economics?
✓ what happens if you connect consumers?
✓ what value can consumers add as creators?
✓ how can you leverage your audience?
✓ how do you add this as a product extension
of your service?
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 67
68. Product services
expanding the concept of what products
should be
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 68
69. What would you do
with Coke machines?
500,000 units
(about 1 per 600 people US)
1.5 x 1.5 meters
1,235 square kilometers
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 69
70. the Coke Network
• they have power
• they have proximity
• located where people “break”
• part of social fabric
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 70
71. over 7,000
hot-spots
get a Starbucks Card, put at least five
bucks on it and then use it at least
once every 30 days, and you've got
two hours of free Wi-Fi a day. Not
bad at all...
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 71
73. • iPhone / iTunes
• most mobile devices
• cable boxes
• Tivo
physical products
logical
products
consumer product design
all design
today
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 73
79
74. • cars
• refrigerators
• televisions
• all mobile devices
• remote controls
• home entertainment
•?
physical products
logical
products
consumer product design
all design
tomorrow
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 74
81
75. • OnStar
• autos have VIN numbers, will eventually have IP addresses
• what if all products have IP addresses?
• guess what? people have IP addresses too
• what happens when you cross product IP addresses with people IP
addresses?
• what are the opportunities for service extensions of products?
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 75
76. Story systems
creating stories with consumers through coordinated use of
new media
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 76
77. 1960 1970 1980 1990 2000 2010
distribution
user interface
functionality
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 77
78. the ambient network
television computer mobile
passive interactive interactive
entertainment productivity connection
lean back lean forward lean forward
Three screens
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 78
79. "By 2011, there will likely be 5.1 billion mobile phone
subscribers worldwide.
Traditional twisted pair land lines will be relegated to
the dustbin of history.
Not a bad penetration rate given the global
population is under 7 billion people."
Pete Sealey, ex-CMO Coca-Cola
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 79
80. print
radio
television
outdoor
interactive
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 80
81. Story systems
Holistic systems that properly utilize
the true use of traditional media and
online interactive media to facilitate
dialogues with, and between,
consumers.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 81
82. Every click is a wish
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 82
83. Great marketers of the future
will not be measured by how
well they tell stories to their
audience
but rather by how well their
audience tells stories about
them.
Applied Design Group web/ www.applieddesign.tv email/ tim@applieddesign.tv phone/ +1.415.258.9575 83