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EDITOR'S REPORT

Using Big Data to Add Value

Solutions from Data: Innovative Apps Can Bring Engagement, Loyalty and Revenue

With today’s systems and devices producing Big Data, there is a need for creative ways to gain insight and use it to create additional value by solving problems related to underlying products and services. This creates customer engagement, brand loyalty and leads to additional growth.

BY TOM WILLIAMS, EDITOR-IN-CHIEF

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Data. It is being relentlessly generated by almost every form of human activity—by commerce, government, research—and by billions of interconnected systems and devices all over the world. Even the smallest sensors generate data that is aggregated over local networks and eventually winds up on servers in the Cloud where it is used for . . . what? Time was, the answer to that question would come from the IT department and it would center around internal operations, cost control, inventory management, customer databases, etc., all very useful and necessary points. But that was data generated and managed about products and business operations. What we are coming to call Big Data is generated more by products and by customer interaction with those products and services.

As such, Big Data has the potential to be used in fundamentally different ways to enhance the user experience, reinforce brand awareness and effectively become an additional product that can add to company revenues and continue customer engagement. This opens a whole new arena for software development that seeks to leverage the digital aspects of a company and its products, many of which are consumer devices based on embedded technology that are connected in various ways and generate data that can be used by customers to improve their interaction with the purchased product.

According to David DeWolf, CEO of 3Pillar Global Software, “More and more traditional companies that aren’t software companies are building software products. Software is now your brand. You touch your customer more through software than any other way no matter what industry you’re in.” This appears fairly obvious due to the Web and how customers find out about and are sold products, but also increasingly in the software applications developed around products to enhance user experience. It should be noted here that the examples given are not necessarily all 3Pillar customers but serve to illustrate the points made by DeWolf.

Take for example, Nike. What does Nike make? Sports apparel, primarily shoes. Nike is of course known throughout the world by its trademark “swoosh” that adorns so many other products, persons and events. Now once we get past all the image, glitter, sports super stars and psychological manipulation, why do people buy Nike products? Well, they have an interest in pursuing sports themselves, physical activity, which also equates to an interest in their own personal fitness.

Nike also offers a low-cost digital product, a consumer embedded system called the Nike Fuel Band SE, which is a bracelet that contains technology to measure activity such as pace, heart rate, etc.; it also offers a Sport Watch GPS that will track pace as well as the path run. There is also a smartphone app called Nike+ Running that without additional sensors tracks distance, pace, time and calories burned along with GPS. In addition there is computer software to store and analyze the data and access to Facebook “buddies” with the ability to earn badges, set goals and generally track and motivate fitness progress. In fact, there is a whole online community called Nike+ dedicated to motivation and training.

All this to sell shoes? Well, actually these are software-based products that are also for sale and they have the effect of engaging the customer and represent value in their own right while reinforcing and adding to the value of the underlying basic product and/or service.

The example of Nike helps illustrate a much wider phenomenon that 3Pillar has identified and is actively involved in, helping a wide variety of companies identify and use software to create solutions that can have a similar effect on their  own growth and market presence. 3Pillar does this for customers by looking for innovative ways of using data related to a product to solve problems. They then create a prototype that can be put out for customer feedback. In this scenario, software development does not begin with a requirements document but rather with a functional concept built on data and knowledge of the customer. This prototype is then refined over time. “Market research,” DeWolf says, “is a thing of the past.”

Consumers have embraced the smartphone and the tablet experience, and the app is now the door to a world of innovative software solutions based on companies’ data and imagination. One customer that 3Pillar did work with to expand the value of its existing business was Carfax, the source for information on used vehicles. Carfax reports are increasingly used by dealers to supply customers with information about vehicles they have in stock. Carfax wanted to grow their company value and add customers by turning their Web-based consumer application into a mobile app.

Now a person shopping for a used car can simply subscribe—note additional revenue—to one or a number of reports and enter the license or the VIN number and get a full report on his or her smartphone. The app features maintenance reports, service records, registration, etc. In addition, the user can locate recommended service providers and receive repair estimates (Figure 1). This is a case of building on an existing software service to create a solution to a remaining problem, namely how to check the report while you’re actually out on a dealer’s lot with a salesman droning his pitch at you. And the app has built on the existing software and data in that it also provides a way to maintain service records on a given purchased vehicle (Figure 2).

Figure 1
The Carfax mobile app lets the user find a repair shop and get an estimate on work that may be needed in conjunction with a possible purchase.

Figure 2
Carfax offers access to a vehicle’s service record and also notifies of upcoming needed service.

But DeWolf emphasizes that such innovation is only the start. There must also be acceleration, the constant use of feedback to continue to differentiate over time. This involves using the customer feedback and customer engagement created by the initial innovative application to continue the product life cycle relying on existing information and information created from customer interaction in an agile development methodology.

This can also make use of other existing and available data that might not have been generated in-house. The existence of Big Data, of course, does not come from a single source. Consider, for example, the possibility of using the biometric data generated from sensors and apps such as those in the Nike+ or a similar environment for inclusion in a medical monitoring application that might bring in other data such as blood oxygen, more detailed EKG data, or more focused data about a specific condition.

There are, of course, other companies offering biometric training monitors besides Nike. What if one of them were to include data from recipes that would furnish information about caloric intake, trans fats or other nutritional data? That could then be correlated with the exercise data to provide an even richer training application or a weight loss program. In a similar way, it would appear that the Carfax app brings in more information than simply the vehicle records. It also accesses repair shop data and can get repair or service estimates. This relies on data well beyond that associated with a given vehicle, but it serves to enhance the value of the underlying product that Carfax originally offered.

The possibilities are endless. Maybe someday we can enter the information from a wine label and get data about that season’s sunshine and moisture, soil character, etc. There is a huge, largely untapped market for the creative use of data supplied by an ever growing number of systems and devices that can be used to create engagement, add to the user experience, increase brand loyalty and solve problems based on huge amounts of existing data. The secret is to look at it in creative and imaginative ways aimed at innovative solutions.

3Pillar Global
Fairfax, VA
(703) 259-8900
www.3pillarglobal.com