November 18, 2011
Nomura Research Institute, Ltd.
Nomura Research Institute, Ltd. (NRI: Tokyo; Tadashi Shimamoto, President, CEO & COO), a leading provider of consulting services and system solutions, has released its latest IT Roadmap1 forecasting the evolution of "customer experience" via the combination of smart devices and social media and its impact through 2016. The smart device market, including smartphones and tablet computers, is growing rapidly, and going forward a variety of sensor data obtained from smart devices will be shared and stored on social networks. Smart devices are expected to be utilized as a "concierge" to introduce and recommend the most suitable services to a person connected to social networks based on their needs.
Over the last several years the number of smartphone users has grown sharply, and today, smartphones account for more than half of all the mobile phone handset models sold by mobile telecommunications service providers in Japan. In addition to smartphones, the market for tablet computers, such as the iPad and Android tablets, is also growing. With devices featuring superior user interfaces much like the iPhone and iPad being sold around the world and as a result of the growing number of applications made for these devices, smart devices are set to become widespread around the year 2015.
Smart devices come equipped with a wide variety of sensors including touch sensors, acceleration sensors, cameras and global positioning systems (GPS). Previously, not all developers were necessarily able to develop applications for mobile phone handsets using sensor functions. In contrast, the Application Programming Interface (API) 2 of various sensors used in smart devices has been opened up to all developers, making it easier for companies to provide a variety of services using positioning information obtained from smart device sensors.
Social media3, which emerged around the same time, is a distinctive service area that developed in combination with the sensor functions used on smart devices. Improving smart device usability with touch sensors has made it easier to browse the large quantities of comments and photos found on social media sites, while GPS sensors have eliminated the need for a user to manually input their location. Going forward, the combination of sensor functions on smart devices and the data obtained from them with social media will likely mean an increase in the sharing and accumulation of data via social networks showing a consumer's interests and behavior.
By utilizing data from smart devices, companies will be able to provide customer support and a wider range of information to a larger number of consumers via social networks. Companies can also perform analysis that combines the interests and behavior of customers as seen through social networks with other customer-related data internally, such as point of sale (POS) data, customer purchase histories and the response records of customer service centers. All of this will enable companies to further enhance the value-added nature of their customer services.
NRI foresees that the combination and utilization of smart devices and social media as company's customer channel will specifically develop according to the following roadmap.
![[Roadmap for Evolving Customer Services through the Combination of Smart Devices and Social Media]](111118/1.jpg)
2011 to 2012: Beginning phase of smart device utilizationAdvanced companies are beginning to utilize information disseminated by consumers through their smart devices for marketing and sales promotion purposes. More and more retailers in Europe and North America are starting to use Location Based Services (LBS) that collect the positioning data of individual consumers obtained from their smart devices and enable consumers to share this information. LBS examples include Foursquare, used by Starbucks and McDonalds, as well as Shopkick, used by Best Buy and Target.
Consumers are beginning to use LBS to share information on their current location over social networks with friends and acquaintances using GPS data from their smart devices. With stores in the retail and restaurant sectors becoming a part of this location information sharing, they are able to encourage consumers to stop by stores that are located close by or provide coupons based on the number of times the consumer has visited the store, which in turn boosts their sales promotion capabilities and improves customer loyalty. This type of scheme is becoming more popular in Europe and North America. Furthermore, use of a smart device's precise location information recognition function is making it possible for stores to introduce products based on a consumer's exact location, to direct the paths of consumers and to analyze consumer shopping patterns in stores.
In the past, companies tended to simply disseminate information to consumers in a one-sided fashion. Today, however, companies are in the process of achieving "sense and response," where the most suitable feedback is provided based on an understanding of the consumer's current situation obtained from smart device sensors.
2013 to 2014: Development phase of smart device utilizationAs is the case with Long Term Evolution (LTE), a standard of high-speed telecommunications for smart devices, once network infrastructure is further developed, data that is sent and received by consumers through their smart device will expand both quantitatively and qualitatively. In addition, consumers will be able to use a wider variety of devices and services to connect to one another through smart devices and social networks.
For example, a social network service currently being planned by a major Japanese automaker will feature a function that enables vehicle owners as well as owners and dealerships to interact with one another via a social network. Moreover, plans call for sensors installed in the automaker's vehicles to "tweet" messages and various warnings, such as remaining battery life, over the social network to the owner and dealership.
In addition to vehicles, the machine-to-machine (M2M) communication era, where objects such as home electronics connected to a network, digital signage on the street, or urban infrastructure, such as buses and railways, can send and receive information each other, is also emerging. Once M2M communications are made possible, even larger amounts of data will flow back and forth, which will require a company to examine how it will respond to "big data," or how it processes and analyzes these large amounts of data.
2015 to 2016: Diffusion phase of smart device utilizationServices that connect consumers and machines via social networks are expected to first start out as services that connect individual companies with consumers. Eventually, this will evolve into a system where multiple companies connect to a consumer's social networks to provide a wide range of services. This is because a single company alone will be unable to meet the wide-ranging needs of consumers as sourced from the ever-flowing data of social networks. As a result, partner companies providing different services will join social networks operated by a single company in order to share sensor data and the interests of consumers as well as to provide value-added services that meet the needs of a wider range of consumers.
As both usable sensor data from consumers and the number of service providers involved increases, it will become ever more difficult to determine what type of consumer needs to detect as well as who should recommend what type of service. An overload of recommendations4 will conversely cause consumer dissatisfaction and will produce a literal flood of information. As such, at this time, operators of social networks and participating companies will need to have more advanced consideration and optimization capabilities regarding what needs individual consumers have under what circumstances and who should provide the most suitable recommendations based on this. In addition, consumers with smart devices will demand a type of intelligent "concierge" service that sorts through and provides recommendations from among the most suitable information they request.
IT roadmaps for other technologies, including smart devices, will be included in a book entitled "IT Roadmap 2012 Edition - Changes in Information and Communications Technologies over the Next Five Years" (in Japanese), which is scheduled for publication in December 2011, by Toyo Keizai Inc.
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