As the internet continues to seep into almost every aspect of our daily lives, the way we use it as a tool and platform undoubtedly changes. And these changes, though they happen over time, can have serious implications for businesses.
Mary Meeker, a partner at venture capital firm Kleiner, Perkins, Caufield, and Byers, delivered her Internet Trends report for 2016 on Wednesday at the Code Conference in Rancho Palos Verdes, California. The report outlines global trends in internet use, as well as shifts in the way the internet is used as a tool for business.
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An annual occurrence for Meeker, this year’s edition is 213 slides long. For those who may not have time to pore over every line, here are some of the key points from the presentation.
1. Messaging is growing and evolving
Messaging apps and platforms are growing rapidly in both the number of users they have and the amount of time being spent on them. WhatsApp is leading the charts, followed by Facebook Messenger, and then WeChat.
A big part of the growth of messaging is the changes that have taken place to enable more than simple text communication. In consumer circles, emojis, stickers, and filter are allowing for more expressive communication, while business users are enjoying more professional services as part of certain messaging platforms. WeChat, Facebook Messenger, and Line offer businesses a way to increase customer engagement, improve customer service, and allow for payments on their platform.
Internet web and chat platforms, and social media, are the preferred way to reach Generation Y customers, which presents a great opportunity for business to use messaging and chat apps to expand their customer base. Additionally, Meeker noted, messaging apps are increasingly becoming the “second home screen” for many users, meaning businesses must target these apps to stay in front of their customers.
2. Interface changes
Over the past few decades, the primary way in which we interact with the internet, and our computers in general, hasn’t changed dramatically. We’ve gone from physical keyboards to touch screens, but the action itself hasn’t changed–until now.
Voice input is dramatically changing the way we use our devices and, in turn, the internet itself. Voice input is faster and easier than typing, and can be better personalized. It does require natural language processing (NLP), but it has a low cost and footprint. In theory, Meeker wrote that it “should be the most efficient form of computing input.”
While still in the early days, voice recognition accuracy is improving quickly and the use of mobile voice assistant and voice search queries are growing exponentially. In quoting Baidu’s Andre Ng, Meeker’s slide said that, by 2020, 50% of all searches will be either voice or image searches. As Meeker also pointed out, iPhone sales dropped for the first time in a decade or so in 2016, while Amazon Echo sales continue to climb.
Automotive technology is advancing, and the car could become the next big computing platform. Today’s connected cars are already making a splash in the market, with companies like Apple and Google competing to become the connectivity partner of choice.
Car automation and safety feature continue to improve, and millions of miles have been driven in autonomous vehicles so far. Regulators are typically slow to adopt innovative technology, Meeker argued, but it is absolutely necessary to advance the automotive industry–especially in the US. Growth in autonomous vehicles presents new opportunities for customer engagement and entertainment during daily commutes and road trips as well.
The automobile could also become the next aspect of mobility. Nearly half of surveyed millennials said that they expect their vehicle’s technology to be able to do everything that their smartphone can. If these trends are fully realized, we could be heading into the second golden age of the automotive industry.
4. Business disruptors growing fast
When most people think of disruptors, they often consider small startups who approach a market in a unique way. However, many of those once-small startups have grown enormous and they are causing big problems for incumbent firms.
Consider internet giant Amazon and legacy retailer Walmart. Amazon has a higher market cap than Walmart ($341bn vs $222bn), and is growing its revenue at 20% year over year, while Walmart’s revenue is falling 1% year over year. A similar story is Netflix, which has more than double the market cap of Viacom, and a staggeringly higher growth rate.
The same trends are seen in online marketplace and even the enterprise–the true disruption of some of internet-native companies is beginning to be felt. Business leaders should begin planning a contingency plan for dealing with potential disruptors, and understanding how to remain innovative and relevant. Disrupt yourself before someone else does.
5. Data as a platform
The amount of data being created has gone up, while the cost of storing that data has gone down. Data is the new platform powering everything from your systems, to your apps, to your infrastructure.
Data is also the new enterprise currency, and analytics are playing an increasingly important role for business operations. This is especially true now as it is easier to collect data and analytics tools are being built for knowledge workers as well as data scientists.
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However, the increase in data production and use has led to increased privacy and security concerns for that data. Billions of records have been breached over the past few years, and customer privacy concerns have grown to the point that many are limiting their online activity to better protect themselves. If your business relies on customer data, ensuring the security of that data and reassuring the customer should be one of your top priorities as a business leader. The same goes for your employees, as their data should be just as important as the data you collect or use from your customers.