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Why traditional businesses need speed to survive

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Matt Simpson
Managing Director

“We won't experience 100 years of progress in the 21st century — it will be more like 20,000 years of progress.”


So said futurist, inventor and Google Director of Engineering Ray Kurzweil in his book The Singularity is Near, on the basis that technology is advancing exponentially in a law of accelerating returns. Put another way, we’re using faster tools to design and build faster tools.

If that speed of change is difficult to get your head around – and it is – then consider what’s to come in terms of computational power alone: By 2023 the average laptop will have the same computing power as a human brain. Twenty-five years after that, that same laptop will have the power of all the human brains currently on Earth.

It doesn’t end there: since exponentially accelerating technologies – computational power, artificial intelligence, robotics, nanotechnology, biotechnology, blockchain, IoT, AR, VR and more – are now beginning to converge, the future is faster than we can comprehend.


Speed, agility and imagination

Understandably, many traditional businesses – born in a world where success is defined by measures such as ownership of assets and number of employees – are struggling to adapt to this unprecedented pace of progress. Even at the current churn rate, it’s estimated that half of the Fortune 500 will be replaced in the next 10 years. In reality, it’s likely to be even more of a bloodbath.

Those who survive will be the ones who embrace speed and agility as the drivers for success in this exponentially-changing world.

That said, those who limit themselves to merely upgrading technologies in their quest for speed and agility are unlikely to thrive. Instead, true digital transformation requires a fast-paced reimagination of business models for a digital world.

The global pandemic has thrown even sharper focus on this need for speed, with businesses rushing to bring new D2C offerings, new services and new digital products to market – a recent survey found companies had digitised activities 20 to 25 times faster than they had previously thought possible in the first six months of Covid.

 
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Freedom to flourish

The challenge now for those traditional businesses in these turbo-charged times is to make a success of these new innovations in their bid for survival. A sobering thought is that right now – according to this survey – only 21% of executives believe that they have expertise, resources and commitment to pursue new growth successfully.

It’s not too surprising. Traditional businesses were built on a bedrock of cautious stability – the rapid experimentation required of successful innovation is alien to them. With the best will in the world, ingrained culture will not change overnight, but businesses who have established innovation hubs, in-house accelerators or digital teams that sit outside of the shackles of the existing infrastructure, processes and mindsets of the organisation are on the right path. Those offered the fullest freedom – in terms of technology stack, talent and process – are likely to run the fastest.

Working with partners for whom speed is already in their DNA is also an advantage. Candyspace recently helped Rolls-Royce – who’ve created their own data innovation hub, R2 Data Labs – explore, define and build a disruptive new business model: an open platform to facilitate the sharing and monetisation of data across the aviation sector, Yocova.

Time, as ever, was critical in securing internal funding, and through rapid ideation and build – marrying customer need with business goals – we were able to bring an MVP to life in four weeks.


Keeping pace with the customer

Disruptive new business models such as these need to be founded on a relentless focus on the customer – be that in a B2C or B2B environment – and, again, speed is paramount. “For better or worse, our lives are accelerating, and the only speed fast enough is instant,” says futurist Kevin Kelly in his book The Inevitable – an assertion supported by an Akamai study that found a 100m/s delay in website loading times can hit conversion rates by 7%.

The speed, quality, consistency and personalisation of customer interactions is paramount for all businesses (PwC reports that 1 in 3 customers will leave a brand they love after just one bad experience).

Covid threw that need into sharp focus for another Candyspace client, Mazda. With dealers shut (then partially open, then shut again), the automotive brand’s web platform became a central hub for customer engagement and lead conversion. Our rapid user testing with Mazda owners and prospects exposed key areas for fundamental improvements in user journeys, allowing us to optimise UX and ensure consistency of experience across all digital touchpoints. As a consequence we reduced bounce by 50%, increased finance conversions by 55% and improved dealer locator conversion by 39%.

Another example of a brand who reacted quickly in Covid to enhance omnichannel experience is Levi Strauss & Co, who launched a a virtual concierge service allowing customers to have one-to-one interactions with employees; turned closed stores into micro-fulfilment centres; allowed consumers to make purchases through links posted to TikTok; hosted nightly concerts on Instagram; used AI to drive a 4x increase in sales during an e-commerce promotion; and upped the ante on the personalised features available to loyal customers on their mobile application, with download rates doubling from the first to second quarter 2020.


Data-driven decision-making

If long-term success – and survival – is dependent on this type of nimble pivoting and bringing customer-centric digital products to market in new business models, then businesses also need to think differently about how they maximise the value of these investments once launched.

“The road to recovery is paved with data,” says McKinsey senior partner Kate Smaje, adding, “Winning companies are investing in the tech, data, processes, and people to enable speed through better decisions and faster course corrections based on what they learn.”

To deliver on this need for fast-paced, data-driven decision-making – rooted in the needs of customers – businesses need the right analytics products. And while well-established tools such as Google Analytics do a good job of assessing the performance of marketing activity, they’re not set up to reveal how customers are actually engaging with digital products and experiences.

Product Analytics tools such as Mixpanel allow businesses to understand why customers engage, convert and retain – providing results in seconds and allowing them to rapidly identify areas to improve experiences, drive customer value and inspire growth.

But this type of data-driven decision-making cannot reside in the hands of analysts alone: the Harvard Business Review reports that 48% of executives cite “people issues” as the number one barrier to being data-driven as an organisation. Mixpanel enables anyone across a business (whatever their personal technical capabilities) to self-serve answers and gain deep insight into the needs of their customers in real-time.

And that combination of a data-driven understanding of customers, the ability to iterate digital products at speed and deliver value back to the business is a potent one. That’s why Candyspace and Mixpanel have teamed up in developing an AI-driven mobile app for Mars Petcare to help dog owners monitor the health of their pets.

While creating real value for customers, it helps deliver on the strategic purpose of creating a better world for pets and provides data enrichment and potential new revenues for the business. As Gordon Cameron, Global Design & Innovation Leader at Mars Petcare, says: “Our customers now live in a world where they blur the lines between brands and services, and products and goods. And what they're looking for is total support and total service solutions, not compartmentalised into individual, little categories.”

Candyspace brought the AI-driven mobile app to Alpha testing in 12 weeks. After all, if we’re going to see 20,000 years of progress in the next 100 years, there’s no time to waste…

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