Published Monday 14th March 2022
People have long joked about how artificial intelligence and data harvesting will one day be used by companies to target individuals, and it would seem they were right. Or, half right, at least.
In this article, we look at the rise of Smart Services, what they are, what they do, and how more companies should be harnessing the data they collect to better market and deliver their product to their customers.
What are Smart Services?
With more things becoming digitised, now is the time for businesses to be prepared to make the shift towards Smart Services and invest in digital solutions.
In essence, Smart Services are a service offered by a company that combines data collection with the power of AI to provide a service to their customers. Spotify is a great example of a Smart Service. Not only does it offer the user libraries of music, but it also collects data on the songs/artists/albums you listen to the most and uses that data to recommend similar music.
Spotify even harnesses the data it collects every year and then shares it with its users in its ‘Spotify Wrapped’ campaign. Here, users can see their top listened to songs and artists of the year in a single playlist. While this might not sound like much, in 2019, Spotify gained almost 3 billion streams from their Wrapped playlists, and the campaign was mentioned in 1.2 million Twitter posts that December. The following year, Spotify saw a 21% increase in app downloads.
To put it simply, we are no longer in a world of selling products but one that sells services. Some of the top companies in the world have achieved their success without selling anything physical to their consumer. Just look at Google and Meta.
Even Amazon built their success by selling a service through which others can sell their products in exchange for a cut of the proceeds – albeit while still selling physical products as well. And with 150.6 million mobile users in 2019 alone, there’s really no question as to why this service is so successful.
This is why, going forward, it is essential for companies to better understand their customers and begin harnessing the data they provide.
The collection and use of this data could be the difference between thriving in the current climate or falling behind competitors. Industries are forever changing, and businesses need to be able to adapt. This is why harnessing data to create Smart Services could transform your business.
Characteristics of Smart Services
Before a company can begin to utilise Smart Services, they first have to know what an effective Smart Service entails. There are five key characteristics that make for a good Smart Service, including:
A connection between the physical and digital world
Upgrade of value creation and economic efficiency
Extension of products and services with a digital level
Transformation of the product into a part of the service
Change from product-centric to customer-centred business models
However, despite these characteristics, there is still one thing to remember when it comes to Smart Services – they are fundamentally preemptive as opposed to being reactive.
Smart Services use the intelligence gathered from customer data to foresee customer needs. They do this by analysing product performance and customer behaviours to gain insight into customers’ needs and supplying the service before the customer thinks of it as a need.
Why You Should Consider Smart Services
While this all might sound new and exciting, Smart Services have actually been around for a long time. Amazon, which we have already mentioned, was founded in 1994 and has been growing more and more every year. Netflix, an online streaming service, has become a household name, and they began offering their service back in 2007 and have since begun offering original content.
So, while the use of Smart Services is not brand new, the need for businesses to adapt is becoming more prevalent if you are planning to stay ahead of (or keep up with) your competitors.
The more innovative your company can be, the more you can outshine your competition. After all, anyone can create a Smart Service, but it takes real creativity and understanding of the harnessed data for a company to create one that succeeds.
Where to Start With Smart Services
We have said it already, but it bears repeating. Smart Services depend on data. Not just how you harness it, but what you choose to do with it.
Every company is a tech company now, which is to say that there isn’t a company out there that can deliver or market itself effectively and efficiently without the use of technology.
Whether this is by creating apps, utilising social media, or just by having a website, companies need tech, and tech breeds data. What will set you apart in this world of rising Smart Services is what you choose to do with the data you collect.
If you would like more advice on how to best adapt to and adopt the latest trends in technological advances for your company, contact our expert team at Expense Reduction Analysts and see how we can help you.