Olof Schybergson knows a lot about the Nespresso business model. Fjord, the indie firm he co-founded 13 years ago that’s now owned outright by Accenture Interactive, is a customer experience and service design firm working on Nespresso’s impressive business case. Service design, in case you’re wondering, is not design in its classic aesthetic form but how companies create services as a revenue stream.
It’s one of the hot topics for any company strategist trying to figure out a future.
“What we’re seeing in Europe is products becoming services,” says Schybergson. “And what that means for something like Nespresso is when you connect the Nespresso machine to the internet, it has the ability to understand you’re running out of supplies and so we’ve built a concierge service for when you’re running low. Nespresso is an example of a company that’s pushing into this space. “Adidas is another example we have worked with. They’ve obviously made most of their money from selling shoes, shorts, shirts and so on, but one of the things we’ve done with them is the development of a digital service that manifests itself as a watch on your wrist.”
Yes, there’s an army of smartwatches coming to market from Samsung, Google and Motorola but Adidas is also in the frame with its individual coaching service. Nike has obviously been there for some time with its Nike+ service and Fuel Band.
Schybergson says there’s a key reason why these product companies are racing to the services sector. “They want and need to earn that place in your life and add value to your life in a convenient way,” he says. “Otherwise they just become a commodity product and a commodity brand alongside others.
“The meta question many people across industries are asking themselves is they used to have local competition which is now global but also it’s not just coming from their industry but from others. Industry boundaries are blurring, geographic boundaries are blurring, so how do you stay relevant in customers’ lives for a long and sustainable period of time with a service they will pay for? Instead of doing what many companies have traditionally done, which is to look at their processes and look at their products and then think ‘how can we push this out into the market?’, you need to look outside-in. I don’t think there’s an industry that’s not ready to be disrupted.”
As part of this messed up, disruptive digital cycle we’re in pretty much for good, Schybergson makes some good points around the need for companies to present “elegant simplicity” to consumers and customers. But there’s also a salient point about how schizophrenic we have become as individuals.
“You have this kind of bizarre, slightly schizophrenic situation where people on one hand want to have lots of control and always want the best deal; they want immediate access to anything they want. And on the other hand that access and that information and brand overload has become too much for them,” says Schybergson. “So if you ask people if they want more money or time, increasingly people are wanting more time. What they want is more time with their families, time for themselves. They want more and paradoxically they want less.
“So part of the solution for companies and brands will be to be contextually aware. Within Accenture we have this design driver we call ‘elegant simplicity’. The insight is that the strategic value of simplicity is actually growing as complexity is growing.”
Which gets us to Michael Buckley’s plans for all this service design thinking from Accenture in Australia.
Buckley was a veteran with digital agency Amnesia Razorfish before moving to King Content and now as managing director of Accenture Interactive. The plans are for Fjord to launch a unit in Australia this year.
“We’ll announce that later this year but Fjord is already active with clients jointly with Accenture in the Australian market,” says Buckley. “We’ve had tremendous demand which is one of the reasons Fjord is establishing here. There is not an industry that’s not ready to be disrupted. All brands and industries will increasingly be digital businesses. Sure it’s definitely easier to say it coming at, say, automotive in a major way, because the connected car is here and the semi-autonomous car is around the corner. In the FMCG market there hasn’t traditionally been as much progress in digital services – it’s been more focused on digital marketing but that’s also changing. And it’s changing thanks to examples like Nespresso.
“The manufacturers of Cadbury chocolate bars or any other type of goods are increasingly rethinking how they reach customers and how they stay relevant in the market.”
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