The New Consumer Contract, with Erich Joachimsthaler of VIVALDI

Today’s guest is Erich Joachimsthaler, VIVALDI CEO and author of The Interaction Field (among others). Since his time at university, Erich has spent his career chasing the intangible value of a brand, far beyond sentimentality and logo recognition. In his latest book, Erich lays out the true intangible value brands can leverage — new digital business models that go beyond delivering great products and services. He shared why brands must enter into a new “Customer Contract” with consumers, one in which they work to solve problems faced by society, not the market.

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Light at the End of the Tunnel: How Dark Stores and Micro-Fulfillment Centers are Revolutionizing the Retail Supply Chain

As the well-worn proverb says, “necessity is the mother of invention,” the pandemic hit retail spaces particularly hard, pushing consumers to use ecommerce more as social and safety protocols increased. While there may be more stores open now, shoppers have found that the convenience and speed when ordering items online is invaluable even long after the protocols have gone.

To take advantage of this, retailers have turned parts or all of their spaces into “dark stores,” which act much the same way a warehouse or fulfillment center would. The opportunity then arises for retailers to not only leverage a wealth of direct consumer data from these types of transactions, but also provide greater personalization and localization services. This itself sets off a bevy of offers and angles from which to engage their customers.

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Pulse Issue 21

The Path Forward for Ambient Computing: How the pandemic both suppressed the development of ambient computing and laid down a foundation for its long-term domination

September 2020

*This month's issue of Pulse is a guest post written by Richard Yao, Manager of Strategy and Content at IPG Media Lab. @ryaoipg
*This month's issue of Pulse is a guest post written by Richard Yao, Manager of Strategy and Content at IPG Media Lab. @ryaoipg
The ongoing pandemic has had a strong yet complicated impact on the development of ambient computing, which refers to the contextually aware software that can serve users without requiring explicit commands. Things like smart home, smart city, and other IoT-enabled experiences, based on technologies designed to fade into the background as part of the ambiance, are all building toward the future of ambient computing.
Surprisingly, smart home devices have shown no significant breakthroughs in either use cases or wider adoption, despite the conditions that stay-at-home orders have created. Adoption of smart home devices among U.S. adults is predicted to grow from 33 percent in 2019 to 39 percent in 2020, according to market research by Hub Research, indicating a growth rate that is at par with previous years.
To be fair, research suggests existing users are using their smart home devices more frequently when stuck at home. Fifty-two percent of voice assistant users say they interact with voice tech several times a day or nearly every day, compared to 46 percent before the outbreak, according to a report released in late April by NPR and Edison Research. But this report also underscores the stagnant reality of use cases for voice-enabled devices, as most usage cited is still limited to basic tasks such as playing music or checking the news.
As long as most use cases remain confined to native functionality, branded voice experiences will likely not get the audience they could theoretically reach via smart speakers and smartphones. All in all, smart home devices may have missed the boat on this round of pandemic-accelerated adoption.
That being said, some implications of pandemic recovery are changing consumer behavior outside the home, making a strong case for accelerating the development of ambient computing.
As we enter the recovery phase, top-of-mind concerns about hygiene, health, and safety may push technologies that enable or aid contactless interactions, such as voice commands and authentication, mobile payments, and contextual suggestions, up the priority list. (The one exception here is facial recognition, which has been losing momentum and facing regulatory challenges due to the discriminatory dangers of biased AI data and misuse by law enforcement.) Most of these technologies would better demonstrate the full potential of ambient computing in a public or a semi-public context, which shifts the focus of ambient computing from inside the home to public spaces.
For example,  some places have already started using contactless devices for checking visitors’ temperatures, or using voice commands to operate a touchless ATM. Checkout-free retail stores such as Amazon Go, which are reportedly coming to Whole Foods stores soon, are also gaining traction as they help minimize human contact and time spent in stores. Once the ambient computing infrastructure is put in place, it will likely remain in place out of our common need for consistency and convenience.
Granted, the home environment is a different context than public spaces, and existing barriers to adoptions at home may persist over the recovery phase. After all, most people have been avoiding public spaces since March, thus stifling some of the developments in this regard. For instance, Sidewalk Labs, an Alphabet subsidiary, unveiled its master plan in 2017 to transform a stretch of Toronto’s waterfront into a smart city powered by ambient computing features, but announced in May that it had decided to shelf the project indefinitely, citing economic uncertainty caused by the pandemic.
Nevertheless, adoption of ambient computing technologies in public spaces will flatten the learning curve by getting consumers comfortable with the kind of context-driven, hands-free interactions that underpin most smart home devices. This, in turn, could pave the way for consumers to be comfortable with ambient computing devices in and out of the home, thus opening up new communication channels for brands to reach their audiences.
The fallout of this pandemic has created a perfect environment for the ambient computing technologies to educate the general public on the use cases and user experiences they enable and demonstrate their worth. For marketers, this is a key innovation area to watch, for it will usher in the next stage of digital transformation and bring new ways of frictionless brand interactions.
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About ANA Marketing Futures

Knowing that marketers are increasingly challenged in their efforts to keep up with the latest trends and technologies, the Association of National Advertisers (ANA) tasked itself with creating a program designed to help marketers anticipate—and prepare for—the future of marketing.


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