10 trends reshaping digital - updated Q1 2016

10 trends reshaping digital
Updated Q1 2016
A Beyond Report

Introduction
What’s in this report?
The digital industry is fond of coining new words and terms, often for things
that aren't so new when you scratch the surface. But it is also an industry
where rethinking the status quo is a constant. You may already be familiar
with many of the trends in this report, but the cycle of innovation and
iteration that this industry is known for means existing concepts can
suddenly find radically new trajectories. In this report we highlight ten ideas
that are gaining rapid traction today, and which will reshape how we
digitally interact with the world around us.
How to use it?
To help you organize your priorities for the trends  
in this report, we have organized them as "Trends  
to prepare for now" and “Trends to start thinking
about”.
Trend to start thinking about
Trend to prepare for now

Non-traditional UIs are
changing interaction design  
as we know it
1

We are moving further
away from traditional
input and display modes
for information.
Already, people are bypassing apps and completing tasks through
interaction with notifications - especially with the rise in popularity  
of wearable devices. Increased innovation around voice and gesture
recognition will continue to render traditional UIs even less important  
in app design as users complete tasks on their mobiles without even  
picking them up.
At WWDC 2015 Apple claimed that Siri
currently serves up
1 billion
requests a
week
(almost as much as a tenth of the mobile searches  
Google is estimated to be serving) and is
40% faster
and more accurate than last year.

The sensor can track sub-millimetre motions at high speed and accuracy.
This means that once the chip reaches mass adoption, users could control
their phone by simply rubbing their fingertips together in mid air.
(https://www.youtube.com/watch?v=0QNiZfSsPc0). Brands will need  
to start thinking about how they can adapt their online and app-based  
services to ensure consumer interactions are simplified through a more
invisible, yet intuitive, UI layer. Getting this user experience right will be
particularly important as more and more notifications compete for our
attention.
In 2015 Google  
introduced Project Soli,
a new interaction sensor which tracks hand
gestures using radar technology.

- Hal Varian, Google
App functionality on demand
will blur the distinction
between the web and apps
2

- Hal Varian,
The app experience outperforms the mobile browser experience -
it's faster and more streamlined, typically using a cleaner UI. It
also has a better integration of native functionality, such as using
the camera to add credit card info rather than having to type it.
This level of experience means that people prioritize apps over
their mobile browser.
Apps dominate the time we
spend on our phones - it’s  
as high as 90% according  
to Flurry.
But app use is dominated by a small handful of social networking
and messaging apps, with Facebook being by far the largest.
By some estimates, the top 0.01%  
of apps garner 99% of all use and
monetization.
This concentration of attention is a huge barrier for mobile app
developers and threatens the diversity of choice that we are used
to from the web.

The two largest platforms - Apple and
Google - need to address those barriers or
risk leaving customers with much poorer
diversity as part of their ecosystem.
Google has already introduced streaming of apps and we should expect  
to see other new ways of accessing app functionality in 2016. For example,
using app functionality on demand for a temporary amount of time could be
a feature introduced soon by Apple and Google. Brands should start
thinking about how they could leverage this, especially if they don't qualify
as having a use case for an "everyday app" relationship with their customers.

Intranets are having a resurgence
through the advent of Employee
Experience Design
3

A third-generation of internal
business comms platforms  
have emerged, and they are
using social networking-style
functionality to drive more
effective collaboration.
It’s not the first time companies have tried to bring social  
to the enterprise, Yammer (acquired by Microsoft) being a
notable early incarnation.
Now, with the rise of user-centred consumer experience
design putting pressure on businesses to pay similar
attention to their employees’ needs, employee comms are
moving away from cumbersome, feature dense project
management tools and linear services like emails.
Companies are overhauling their internal comms platforms
to become lean, interactive and reminiscent of the digital
experiences that employees partake in outside of work.

Slack, Hipchat and the recently launched Facebook at Work are
rethinking work communication with Slack earning the
distinction of being the fastest-growing enterprise app ever.
Slack has formed integration partnerships with tools such  
as Lyft, Dropbox, Twitter and Trello, so employees get an
overview of all the information they need in one well-designed
experience. The reinvention of intranets represents fertile
ground for user-centred design that has a focus on employees
rather than customers.

Employers are moving towards
much more flexible workplace
tools and solutions -
ones that resemble how consumer apps easily combine data
streams through APIs to bring much greater convenience to the
user. These tools are emblematic of how so many business tools  
and systems have catastrophically failed in the past. Instead of
implementing monolithic systems designed to satisfy technical
requirements, companies can now rapidly build and customize
systems by connecting the components that best meet their
employees’ needs.
Slack isn’t for everyone, but it has shown that workplace apps
are in dire need of using today’s digital design practices. The
beauty of Slack and many of these other tools is their
simplicity - the barrier to entry (and to user benefit) is so low
that they gain enough momentum to be adopted en masse.
Our patience for software that offers a poor user experience is
incredibly low - if we struggle with something, we will simply
abandon it and try something else. Our level of expectation is
incredibly high, both as a consumer and an employee.
Companies are now starting to realize they can use new
frameworks to design solutions that can be as good as the best
digital consumer experiences - something the enterprise has
been lacking for a long time. The key is to design these
solutions around the needs of their employees, rather than
force their employees into a solution that doesn't fit their
needs.

Virtual assistants will enable new
commerce platforms, replacing
search engines as we know them
4

Companies are racing to build
products that act as omniscient
personal assistants, automating
cognitive tasks.
Some products - like Apple’s Siri, Google Now, or Microsoft’s Cortana -  
rely entirely on algorithms and though they can be used by a lot of people,
their range of tasks remains limited. Others, like startups Magic and
Operator or gig-economy companies like TaskRabbit, employ people to
respond to text-based requests. These services can get nearly anything
done, but are hard to scale. Facebook M is a hybrid. It’s a virtual assistant
powered by artificial intelligence as well as a band of Facebook employees,
dubbed M trainers, who will make sure that every request is answered
while also training the AI so that it eventually can take over. Early reports
indicate that this hybrid approach is paying dividends and may prove to
be the way forward. We’ve seen this approach be effective in getting text
analytics (NLP) to work better, and next-generation machine learning
techniques should enhance this further.

Google Now takes this further, using passive AI technology  
for Android phones. This means your phone has access to  
all the information within its apps, and can make
recommendations or offer to take action based on everything  
it knows about you and the information within its apps. If  
you have a flight booked, Google Now will keep you updated
on the flight status, advise you on timings for your journey to  
the airport and prepare your boarding pass for you.
The company that wins the virtual assistant race stands to
profit from matching businesses with people looking for
services similar to theirs, much as Google currently does
through search, creating a gold rush in the years ahead
between the tech giants.
Many see a more advanced
and reliable assistant
replacing search engines.
Whether controlled with voice commands like Siri or through a text-
based messenger like Facebook M, AI-powered assistants not only surfaces
information you are looking for based on what it already knows about you
but can go one step further and complete tasks. These services are
becoming more ingrained into the way we interact with our devices.

Open data is finally taking off
5

Now 70 countries have made their data relating to transport,
crime, property tax records and much more available to the
general public. Although around
1 million datasets
have been published to open data portals, historically much of
it was poorly labelled, disorganized, lacking context and seldom
updated. We are seeing a growing trend of ‘open-data
hackathons’ that connect data custodians with analysts, coders
and entrepreneurs. These cross-functional teams look to create
successful businesses by comparing different data sets to
provide valuable information to end users.
Six years ago America  
became the first country to
make all data collected by its
government “open by default”
- except for personal
information and that related
to national security.

Property website Zillow, GPS company
Garmin and the route planning app
Citymapper are just three examples of
multi-million pound businesses built
using free government data.
A large number of startups have been founded on the basis of
exploiting these new data sets. For example, we recently worked with
a startup that developed machine learning algorithms that use WHO
data sets to solve medical insurance problems. We have probably only
seen the start of this and there will be many more new ventures that
will find new ways to create value through open data.

The personal information
economy market will take off
in earnest in 2016
6

The idea of personal information being an asset class was circulated by the
World Economic Forum back in 2011 and Doc Searls (author of the Cluetrain
Manifesto) has been writing extensively about customers taking charge of their
own data. When discussing data collection by companies, Apple CEO Tim Cook
was quoted as saying “we think customers will rebel over this. Over the arc of
time, customers will move to people they trust with their data.”
Consumer backlash against personal  
data collection by companies is creating
an opportunity for new intermediaries  
to help consumers take back control of
their data.

89% of consumers agree with this statement:
“I should be able to control
what data a company collects
about me online, and what it
uses this data for."
Source: BCS / YouGov December 2015
Enter the idea of a Personal Information Economy, where value is
created by letting consumers take control of their data and use it to
better manage their tasks. Consultancy Ctrl-Shift is now tracking
500 companies in the space who have received a total of
$2.5 Bn in investments
so far. We saw MyWave’s presentation at this year’s Personal
Information Economy conference in December 2015 (organized by
Ctrl-Shift) and were duly convinced that this market is now ready
for take-off.

/
They will be able to build on this trust by launching new services that
help their customers manage more aspects of their lives. This shift will
be part of the continued move from generic mass marketing campaigns
to tailored targeted interactions initiated by consumers sharing -
knowingly or unknowingly - a purchase intention or unfilled need
online. Businesses need to build an online infrastructure to support
this new kind of relationship with consumers by developing the correct
online skills, capabilities, technologies and channels.
PIMS (Personal Information Management Services) is one example of
the kind of services that can help consumers complete life tasks more
efficiently. As an extension of the mortgage products they sell to their
customers, a bank could, for example, offer a solution for consumers to
manage the whole process of moving house. Much of the data captured
in the mortgage application process can be repurposed to facilitate the
complex task of moving.
Smart brands that
understand this
opportunity and actually
build data strategies that
benefit their customers
will win in the battle for
customer trust.

Brands that fail to improve the
mobile checkout experience are
facing big drops in overall
conversion levels
7

When it comes to the share of traffic coming from mobile, almost every
company we talk to has long passed the 50% mark, and some are bracing  
for the 70% mark. Sooner or later, e-commerce sales will have to follow - and
consumers now seem to be getting comfortable with the idea of buying  
things on their phone.
Black Friday was a key milestone in
2005 in the UK and US. Mobile sales
represented almost half of all online
sales in the UK, and 63% of traffic.
The US wasn't far behind.

Mobile conversions, including
transaction values, have
historically been limited. They
have underperformed against
PC conversions, due to
customers being deterred by
small screen sizes, awkward
data entry and security
concerns.
The mobile checkout experience for most brands is poor,
leading to sub-optimal conversion rates. Businesses are
often too focused on trying to transpose their desktop
checkout experience onto a smaller screen, rather than
considering the mobile context and functionality and
designing the experience accordingly.
The fact that consumers are now ready to buy things on
their phone is a wake up call for brands that have not
optimized their mobile experience, especially the most
critical part – the checkout journey.
With the rapid change in consumer behavior, brands that
are too slow to adjust will lose out faster than they
expect.

Increased friction in the
competitive sharing economy8

The connecting power of the internet
and the rise of digital platforms that
leverage a ‘sharing economy’ business
model enable professionals to monetize
specific skills they have or resources
they own.
New businesses like Uber, Mechanical Turk and MyClean successfully
exploit the advantages of a light-weight, low investment, internet-based
set-up: a reduced need for physical offices; a reduced need for full time,
contracted employees; the use of computers to repackage consumer
needs into another set of users tasks; and an ability to access spare time
and cognitive capacity all across the world.

As these businesses scale up from challenger brands to
industry leaders, they will struggle to hire, train, manage and
motivate employees who have little loyalty to their part-time
employer - and they will also face more regulatory scrutiny.
Brands like Uber are focusing on retaining their customer
base by slashing prices but as a result, they’re losing drivers to
their competitors, who pay better. These companies need to
strike the balance between customer and resource retention.
As seen with Uber in France and Germany, new markets,
competitors and regulators will respond to the cannibalization
of established brands and industries by these digital
alternatives. Better value to the customer may not save new
digital upstarts from being politically outmanoeuvred by
established players.
Although this new generation
of businesses are fulfilling
unmet consumer needs,  
they fail to offer sustainable
employment to their part-
time staff.

It’s not just entertainment
companies betting on the mass
adoption of VR
9

As they bet on second- and third-generation headsets achieving mass
adoption, a range of uses and revenue opportunities will open up through  
the platform. It’s not likely to be an overnight success, but rather, similar  
to the adoption of mobile phones: large, somewhat cumbersome devices  
will attract early adopters but as devices become better performing,  
better looking and cheaper, more people will begin to use them.
Certainly, major brands within the entertainment industry such as Disney,
Sony, Comcast, Time Warner, 20th Century Fox and Legendary
Entertainment have already invested millions in VR content. But there are
many other industries betting on it becoming a mass-market medium. Piper
Jaffray investment bank predicts that, by 2025, the market for virtual reality
content will be $5.4 billion, while the hardware component will be worth $62
billion.
Dozens of industries are
investing in the VR space

“People are valuing experiences
more than things”
Raja Rajamannar, CMO of MasterCard,
which is why MasterCard is discussing how it might use VR
technology to give customers insights into places they might like to
visit. Companies will continue to explore B2B uses for VR as well.
Ford has started using Oculus headsets to help its designers see
what new cars will look like before they are built, while the aviation
and medical industries are developing training programs using VR.
2016 will be about proving that VR is a truly disruptive product
rather than a luxury tech gimmick. To achieve this, designers
will have to meet the challenge of designing interfaces to be seen
in a three-dimensional ‘real world space’. This will involve
testing the waters to find out the level of interference users will
tolerate in their field of vision as well as battling various privacy
issues.
VR headsets have the ability to track and record a user’s
movements and reactions, which is the sort of data that, when
combined with the kind of information collected by companies
such as Facebook, can reveal a lot about the users’ private lives
and habits.

"VR is going to grow slowly.
If you think about the
arrival of computers or
smartphones, the first units
shipped did not ship tens of
millions in their first year.
But they proved an idea and
made it real.”
Mark Zuckerberg

Retailers and consumer brands
will collaborate to create more
seamless customer journeys10

Brands and retailers will  
pool their data to achieve  
a deeper understanding of  
their consumer’s broader
online behavior.
For brands that don't sell directly to the consumer (such as
drinks and snack manufacturers), e-commerce remains
tricky territory. These brands invest large sums to create
branded online experiences, content and campaigns. But
by not controlling the final part of the journey - purchase -
they are in effect stuck with a broken customer journey.
Retailers can significantly enhance the value they deliver
by providing more flexible solutions for brands to connect
their marketing efforts to the point of online sale. Key to
this is the utilization and sharing of data. It enables
promotion types that are difficult to get right offline, such
as personalized offers based on purchasing behaviors. It
can also enable brands to reach the right customers with
rich content at the point where they are trying to make a
decision.

E-tailers like Amazon are innovating in this space, but
many traditional retailers are also pioneering new
solutions that consumer product manufacturers are
getting excited about.
Perhaps the biggest opportunity is that of sharing data.
By pooling retailer data with brand data, both can start
to learn more about the entire consumer journey - from
awareness through to purchase. This can enable better
targeting and personalization - which doesn't
necessarily mean more ads and retargeting. In fact,
most large brands worry about excessive targeting and
want to use data to minimize the showing of ads to
someone who has already seen it, or has just bought the
product. As brands strive to be more relevant to
consumers’ needs when they are looking to get
something done, data is key to understanding user
intent.

Contact details
Matt Iliﬀe
GM San Francisco
77 Maiden Lane, 3rd Floor
San Francisco
CA 94108
USA
T: +1 415 374 2874
E: sanfrancisco@bynd.com
Charlie Lyons
GM London
75 Bermondsey Street
London
SE1 3XF
UK
T: +44 (0)20 7908 6555
E: london@bynd.com
Matt Basford
GM New York
481 Broadway, 2nd Floor
New York
NY 10013
USA
T: +1 646 535 1677
E: newyork@bynd.com
San Francisco New York London
Emma Downham
GM Mountain View
1300 Villa St
Mountain View
CA 94041
USA
T: +1 415 374 2874
E: mountainview@bynd.com
Mountain View

Thanks for reading.
This trend report was brought to you by the research and strategy team at Beyond as
part of our ongoing work to help create a world without friction.
www.bynd.com

10 trends reshaping digital - updated Q1 2016

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