The razorfish5 report 2011
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The document discusses the accelerating pace of technological change and its implications. It notes that computing power is growing exponentially and will soon match human brain power. While some argue this will overload people, the author believes it will enhance human abilities. The document highlights how mobile devices like the iPad were adopted much faster than previous innovations. It concludes by predicting five emerging technologies that will be important for businesses in the coming year.
![It just works: The interface and the device One Size Does Not Fit All
operate together in a way that consumers
can easily learn and master. The tablet is With projections of global sales reaching
closer to an appliance than a computer; +100 million units by 2012 and the plethora
users expect it to work like a TV. When it’s of choices in form factors and operating
on, it’s on. Additionally, you simply tap the systems, the neo-tablet signifies the
screen to do something. next generation in end-user computing.
However, one of the driving forces for
“The fact that you can’t do everything with creating multi-purpose tablets is the ability
a [tablet] like you can with other PCs - is to create and consume content on the same
exactly what makes it successful” - Forrester, device. After all, the content that’s available
May 2010 on the tablet is critical to the experience,
whether it’s user-generated or not.
Clearly, the tablet’s user-friendly touch
interface, convenience, portability and high In these early days, the iPad commands
degree of usability signifies the beginning of 85% of the tablet marketshare, despite the
the end for a computing experience that had fact that it is often disparagingly viewed as
become almost painful for consumers. With a device suitable for content consumption
the release of the iPad and forthcoming rather than content creation.
devices from other manufacturers, like the
Samsung Galaxy Tab and Motorola Xoom, It can perform some light productivity tasks
the tablet device has finally fulfilled the such as email or word processing, but the
promise of delivering a truly transformative on-screen keyboard is not optimal for data
computing experience. entry or programming. Additionally, the
iPad owners spend a longer amount of time with their content
Weekday Length of Time per Weekday Length of Time per
Session by Category - iPad Session by Category - iPhone
78%
49%
44%
40% 40% 37%
34% 35% 32%
31% 32% 27%33% 24% 31% 29%
25% 31% 28%
25% 22% 24% 30% 27% 22% 25% 22% 24%
20% 19% 18%
18% 22% 16% 15% 15%
16% 7% 9%9% 8% 10% 10% 14% 11% 9% 8% 4%
7%
2% 5% 5% 3% 3% 5%9% 3% 7%
2%1%
Movie TV Book Magazines Music News Movie TV Book Magazines Music News
Less than 15 minutes 16-30 minutes 31-60 minutes 1-2 hours More than 2 hours
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![creative executions and media plans, among the growing crowd concerned with
and immediately tweak them to deliver privacy matters. Let’s back up and define
the best-performing ads and reach the targeting or, to use a more benign synonym,
optimal audiences, even as measurement personalization. At the highest level, it is
data starts to come in. To enable this, our using data that can be gathered from either
analytics approach has become advanced anonymous web users or from people who
and sophisticated enough to identify true are identifiable because they’re logged into
relationships across the data that will be a website. This process allows us to create
meaningful for consumers and profitable for consumer segments and those segments
clients. are used to create relevant experiences. For
example, if the data tells us that you are in
Amid the vast sets of data, it’s the tiny a particular segment and we know that that
subsets that have the most significant segment is interested in mountain bikes, we
impact on our customer interactions. We can show you mountain bike experiences
have already altered the way we design our instead of road bike ads. Think about it
analytics and data management solutions by this way—lots of data sources map into
initiating strong measurement and KPI [key segments, and segments drive experiences
performance indicator] strategies alongside and messages anywhere you can create
our technical solutions to drive our clients’ experiences where experiences are driven?
business goals.
In our experience, just about every display
These Razorfish-led innovations ensure ad is somewhat targeted and personalized.
sound business logic and measurement Have you ever noticed that when you start
techniques combine with our Business looking for a product, ads for that product
Intelligence to drive down latency to a start showing up more often? Combating the
near real-time basis, creating an almost low clickthrough rates challenge of display
immediate feedback loop. The renaissance ads, advertisers have used targeting data
in data-driven display ad planning and for years. However, it is far too rare that
measurement is just one example of big data this data and targeting information is used
in action. beyond display ads, and leveraged across
multiple channels, from websites, to mobile,
Targeting or Personalization to email, to social applications, and beyond.
Often times someone will click through
Targeting is one of those hot-button an ad to end up on a web experience, and
marketing terms that means different things all that wonderful information that was
to different people. Its vaguely threatening available in the ad never makes it to the
sound doesn’t hold – no one wants a desktop or mobile site, or even in-venue
bullseye on them after all – especially kiosk. That is the opportunity we have here.
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The razorfish5 report 2011
- 2. Copyright 2011 Razorfish LLC. All rights reserved
- 3. Contents Introduction: The Pace of Change ................................................................................................... 03 Near Field Communications ............................................................................................................ 07 The Interface Revolution ................................................................................................................. 13 Open Digital Services: Open API Platforms Enabling Consumer-Driven Innovation ........................ 21 Marketing in the Age of Big Data ..................................................................................................... 26 The Cloud’s Influence On Enterprise Architecture ........................................................................... 35 Looking Ahead: Predictions from our Authors ................................................................................. 41 02
- 4. 5 The Pace of Change Bob Lord, Chief Executive Officer (@rwlord) Ray Velez, Chief Technology Officer (@rvelez) In his book “The Singularity is Near,” Exponential Growth of Computing inventor and futurist Ray Kurzweil predicts a Twentieth through the twenty first century pace of technological change that will make our recent strides feel glacial by comparison. 10 60 He sees cures for pollution and poverty, 10 55 10 50 aging and illness, even death. Physical Calculations per Second per $1,000 10 45 products will be conjured out of thin air – 10 40 or, more accurately, out of very expensive 10 35 printers. The rise of nanotechnology will 10 30 All human Brains 10 25 bring together man and computer in a 10 20 way that “will enable us to transcend our 10 15 One human Brain biological limitations and amplify our 10 10 One Mouse Brain One Insect Brain creativity.” By 2021, computer power will 10 5 1 be equal to that of the human brain, a 10 -5 state of affairs that will make Watson, the 10 -10 IBM-designed supercomputer that recently 1900 1920 1940 1960 1980 2000 2020 2040 2060 2080 2100 Year trounced a couple of flesh-and-blood brainiacs in a series of “Jeopardy!” matches, squeeze more information into our heads. look like a Commodore 64. In the past it’s been said that most folks only use 10% of our brain. Well, maybe we Not everyone is embracing this trend. The can up that to 12% or 15%. bandwagon of people who believe that all this information is actually overloading Whether all of these predictions come true us or rendering us Google-hooked know- by the dates assigned by folks like Kurzweil nothings is getting crowded. We believe doesn’t matter. The point is that change is that the opposite is true. Our brains have occurring at a more rapid rate than ever. been getting faster and faster at processing Our position here at Razorfish is that we images, an improvement that helps should simply ride the wave. As businesses, 03
- 5. 5 Brain Scanning some of the key trends that show how the Image Reconstruction Time pace of change is quickening. The most breathtaking is the lightning-fast adoption 1000 Logarithmic Plot of Apple’s tablet, compared even to the 100 other hot products developed by Steve Jobs since 2001. Three months after launch, it’s 10 shipped over 14 million units. At a similar Seconds 1 point in time, only about three million 0.1 iPhones were in circulation. But before 0.01 Apple had a chance to kick back and relax, 0.001 the Google-developed Android platform basically took over the smartphone market Year 1970 1975 1980 1985 1990 1995 2000 2005 in just 9 months. Think of all the amazing computing power now available to be we need to be continually innovating and stuffed into the back pocket of a pair of adopting technologies to keep pace. It’s less jeans. We’ve already seen these devices about science fiction than science fact. put mobile application development on the map. That’s only the beginning. Consider the mobile space. iPods grew fast, iPhones even faster, and iPads left For the second year, Razorfish Technology’s them in the dust. The former Morgan- Group has compiled a list of five Stanley analyst Mary Meeker, speaking at technologies that will become crucial to Google’s Thinkmobile conference, captured your business in the coming year. Our best KP iPods Changed the Media Industry... iPhones Ramped Even Faster... IPad Growth leaves its “Siblings” in the Dust CB First 3 Quarters Cumulative Unit Shipments, iPod vs. iPhone vs. iPad 16,000 ................................................................................ iPad iPhone iPod 14,000 ................................................................................ Global Unit Shipments (1,000) 12,000 ................................................................................ 10,000 ................................................................................ 8,000 ................................................................................ 6,000 ................................................................................ 4,000 ................................................................................ 2,000 ................................................................................ 0 0 1 2 3 Quarters After Launch 04
- 6. KP Android has Hit Critical Mass CB First 9 Quarters Cumulative Android Unit Shipments 80 ................................................................................ Global Cumulative Unit Shipments (MM) Android Global Units Shipped 70 ................................................................................ 60 ................................................................................ 50 ................................................................................ 40 ................................................................................ 30 ................................................................................ 20 ................................................................................ 10 ................................................................................ 0 0 1 2 3 4 5 6 7 8 9 Quarters After Launch strategic and creative minds have come intuitive, attractive and approachable. It together to ensure holistic look at upcoming seems like the days are numbered for that technologies, tying them to key business and dynamic duo of the mouse and keyboard. marketing priorities. The Razorfish Emerging Experiences team takes us through the new interfaces and One of the most exciting areas of innovation their implications. is around Near Field Communications, a set of short-range wireless technologies that Two Razorfish technology leaders, Basel facilitate the use of contactless payments. Salloum and Salim Hemdani, both group Google has built the capability into its VPs, walk us through Open Digital ServicesSM. Android OS with a production phone in ODS is about organizations opening up December 2010. Apple is rumored to follow services in a way that makes them available suit. NFC will usher in a whole new way of to any technology at any time, safely and interacting with our devices and it’s not securely. Building on Open APIs, this is a just for payment: think of the implications company’s best chance of keeping pace with couponing, added-value information from changing business models and technologies. merchants, and so forth. Paul Gelb, VP-mobile and Heiko Schweickhardt, technology lead, In the new digital reality, the amount of will give us an overview of what’s to come. consumer data available to organizations is colossal. Ignoring it is just as big a missed Interface change is going beyond tablets opportunity. With new cloud-based tools and and touch in 2011 as the ways available to techniques we can finally make sense of the interact with computers have gotten more trillions of rows of data to have better and 05
- 7. more targeted conversations with our clients. Whether those conversations are through display ads or on web sites, you need to make sure you are listening to your customers with data and analytics. Ray Velez, Razorfish CTO, and Pradeep Ananthapadmanabhan, CTO of Publicis Groupe’s VivaKi, pull together some of the innovative technologies and techniques we have used to help clients such as Best Buy and others. Lastly, as the cloud infrastructure has become top of mind for most CIOs, it’s important to understand how your business and technology architectures change. Technology directors Jibi Scaria and Mandhir Gidda along with Ray Velez pull together best practices from across the organization learned from work we’ve done with clients including O2 and Mercedes. It should be clear by now that we’re not going to tell you how to inject nanobots into your customers’ bloodstreams. But we’d bet that by the time you’re finished reading this report you’re reeling a bit from the sheer speed with which the business scene is changing due to technologies like the ones we’ve identified. We hope we provide some guidance and, of course, we hope you enjoy. 06
- 8. 5 Near Field Communications Paul Gelb, VP of Mobile Heiko Schweickhardt, Technology Lead In June 2007, a slide for everyone to learn the ins and outs in a Razorfish client of the technology and what it means for presentation painted a commerce, marketing and privacy. In the bleak picture for near field hands of those companies, NFC yields communications. “Today, a much broader opportunity than what the NFC contactless mobile payment arises from the contact-free nature of solution that is prevalent in Japan and mobile payments and a slice of merchants’ many emerging countries is not a viable transaction fees. Payments aside, NFC solution in the U.S.” We found that the has the potential to ignite billions of growth and impact of NFC had been stifled dollars of incremental revenue from by the competitive situation already in mobile marketing services. This windfall place, not by a lack of infrastructure to would finance countless transformative support it. Because the market for credit applications of NFC technology. It is in this and debit cards in the U.S. is saturated, context that the emergence of NFC in 2011 a new payments system would have to will be a watershed moment for mobile, provide significantly more value to users and impacting every industry. solution providers. NFC technology has been available for years, but it has only attained This new data and integrated service significant adoption in a few markets as a offering could generate billions if contactless payment solution. So, given all not hundreds of billions of dollars in that, near field communication (NFC) may incremental ad revenue. The increase in seem to be an odd selection for this report. inventory would come from the number of mobile users and the amount of time What’s changed in four years? that they spend with their mobile phones. There are over 5 billion mobile phones, Apple, Google and Facebook. NFC figures which is over 4 times the number of TVs. in the immediate plans of these uber- In fact there are more mobile phones disruptors and that means it’s important than people with access to fresh drinking 07
- 9. 5 water. The penetration of smartphones, the system in which they match ad requests devices marketers will predominantly be from advertisers with consumer profiles able to target, is growing exponentially. The that reside in a database that they control. device is always with the consumer, creating According to the patent request description, the possibility for it to trigger a targeted an advertiser, using the dynamically-priced ad on nearby digital signage or any other system, may pay a unique price for an digital consumer touch point. Last, and advertisement based on an assessment of most importantly, the additional data would characteristics unique to the target recipient. increase ad effectiveness and efficiency by allowing marketers to target the most A great deal of NFC’s value is in its ability valuable consumers with the most effective to replicate ancillary value streams from ad content at the time they would be most credit and debit cards. For example, the receptive to the message. aggregated data from each user’s purchase behavior creates purchase histories that are NFC’s advertising potential is what is of the integrated into data from various sources most interest to new NFC market entrants by credit report firms to create robust such as Google, Microsoft, Apple and consumer profiles. These profiles are used Facebook. In fact, Apple has submitted a to create highly targeted lists of consumer patent for a dynamically priced advertising sales leads that can be sold at high prices to Apple´s Dynamically - Priced Advertising System www.patentlyapple.com Patently Apple 110 112 112 112 Advertisement Advertisement Advertisement 110 114 Infrastructure Owner/Manager 116 116 116 Advertisement Advertisement Advertisement 124 126 Target Advertisement(s) Marketing Factors 118 118 118 Bill Bill Bill Target User 122 Infrastructure Owner/Manager 114 08
- 10. direct marketers. The list of consumers can pattern will allow marketers to reach a whole be targeted by geography, demographics, new level of analysis and optimization of behavior (lifestyle activities like golf or marketing programs. gardening), methods (preference for online purchasing vs. mail order) and life stage events (new parents or new home owners). Privacy Some banks and credit card companies have even sold highly targeted ad space on Most readers by now have likely started account statements directly to marketers. to think, if not scream out loud, about privacy issues. A comparison to other similar This value stream provides an opportunity products and user behavior patterns shows for NFC to generate exponentially more that privacy concerns will not impede value than credit or debit cards. NFC can mass market adoption rates. As previously connect a consumer with the physical world discussed, credit and debit cards provide in ways that generate an infinite number of numerous institutions with consumer data, interactions or valuable profile data points. which includes more personal information Consumer profiles could now include a user’s than any digital property currently collects. current location, where they have been, who Adoption and usage of these cards they have been in contact with, who is in their skyrocketed when loyalty point programs social network, what media content (across emerged. Consumers clearly demonstrated multiple channels) they have consumed and their willingness to relinquish the anonymity even how much influence they have on other of cash as long as they were compensated. consumers’ purchase decisions. When Amazon provided product NFC providers can also close the loop recommendations, based upon items the between mobile marketing programs and user had viewed but not purchased, many conversions. Evidence from NFC Pilots, posted were apprehensive. Consumers’ fears were job descriptions and registered patents has assuaged when Amazon communicated revealed the imminent release of several the value of those recommendations. integrated mobile marketing and commerce Netflix and Pandora provide more extreme solutions. These solutions would enable examples. Both companies are able to one service provider to deliver targeted provide and communicate enough product ads and promotions (coupons), integration value from information submitted by users of consumer profiles with product/store that the average user is now submitting all databases, promotion redemption, retailer kinds of data in the form of content ratings support for enabling m-commerce at the POS and movie account queues. These examples and consumer NFC contactless payment. The clearly prove that privacy issues are ability to see a consumer’s full behavioral removed when a company communicates 09
- 11. the value the user will get from data NFC touchpoints for consumers. Potential collection, there is transparency around the interactions with touch points include virtual data collection and/or the user is given a check-ins to participate in loyalty programs, choice to opt in. special offerings and related product recommendations or virtual concierge NFC providers could follow these tactics by services like indoor augmented reality having a personal information and loyalty and floor plans. All these services can be program management application for mobile consumed with an intuitive wave gesture. devices. Users would be able to opt in to a Touch points like these will likely drive more collection of their personal information and consumers back into retail stores, providing select what bits could be used for ad targeting. them a richer, hands-on experience throught In exchange for opting in, users would be the integration of services. compensated by mobile wallet dollars. These rewards dollars would be based on events in which their information was shared Security with advertisers and could be redeemed during any m-commerce / NFC transaction. Security will likely be a greater challenge These virtual dollars could be financed by than privacy for NFC. The high value of a nominal percentage of the incremental access to a person’s financial assets and revenue generated from ads that leverage the personal data will increase the risk of consumer’s information for targeting. potential threats. Several NFC providers are planning to offer remote deactivation of the NFC functionality and deletion of profile User Experience information. Another security protection will be a biometric sensor that can read Consumers would benefit from a highly fingerprints or other anatomical features. improved user experience with NFC as Once again the revenue potential of this well. While contactless payments can be opportunity will allow market leaders in the technically achieved in different ways, the space to invest in and constantly improve ease and swiftness of waving a mobile security protections. While NFC may never phone in front of a retail register is far more be completely secure , there should be likely to be understood and embraced than the same level of protection as personal is a process where you have to scan visual information data bases and financial services codes with an embedded camera app. companies offer on other digital channels. Ultimately, we have witnessed significant However, again extending our focus database breaches over the last few years, beyond payment reveals a value that can but there has been a negligible effect on be significantly increased by providing consumer adoption. 10
- 12. The last hurdle for mass implementation of NFC chips, is currently offering businesses NFC is the cost of producing and distributing in pilot cities free NFC receiver hardware hardware to stores that are capable of when they participate in ongoing tests. Even receiving payments from consumers’ governments have begun to invest in the mobile devices. NFC providers and public technology. The French government has institutions have already demonstrated spearheaded the purchase and distribution their willingness to absorb all or at least a of thousands of receivers for businesses in portion of this cost. This is especially true 13 cities that are participating in one of the when mobile devices are leveraged as largest NFC pilot testing programs ever. As the receiver hardware. Google is said to well, public transportation authorities in be poised to distribute as many as eight several U.S. cities have begun to invest in million “custom mobile devices” to small testing and implantation of NFC payment businesses around the U.S. Apple has pilots receivers for rider mobile payments. with several retailers, that includes IOS devices with preloaded m-payment receiver The large number of players investing in accessories, dedicated customer support NFC is evidence that the costs of addressing agents, expedited dispute resolution, challenges presented by privacy concerns, invitations to VIP events and merchant security threats and receiver hardware costs rewards. Bling Nation, an NFC start up are not prohibitive to the NFC business that leverages stickers with embedded model. However, to maximize ROI and Communication Between Controlling & Controllable Devices www.patentlyapple.com Patently Apple 90 94 Controllable Device 32 24 25 WAN Wired 1/0 IR Interface 34 24 30 NFC Interface PAN LAN 106 110 102 104 96 98 100 114 116 Internet Web Service 34 28 108 112 30 NFC Interface PAN LAN 32 24 25 WAN Wired 1/0 IR Interface 92 Controlling Device 11
- 13. profit margins, potential NFC providers for companies that have looked beyond are investing in the development of non- mobile payments to uncover its untapped payment NFC applications for users. These potential. What will make NFC’s emergence utility and entertainment applications in 2011 even more exciting are the potential will provide non-monetary benefits to revelations from innovative companies that consumers and generate additional value are able to take the next step. Applications in creating consumer profile data. These and device accessories have exploded innovative NFC products could be offered alongside the recent rapid growth of smart as part of the compensation for opting into phones and tablets. When we look beyond data collection. NFC entirely, what new opportunistic industries will be revealed? For example, Apple has already patented an NFC application that could align with this strategy. The patent describes mobile devices that leverage NFC as becoming universal remotes capable of controlling any other NFC device, including TVs, DVRs, DVD players, gaming consoles and even garage/ doors. Data generated from this application of NFC technology would include what content and commercials a user had seen across multiple media channels. NFC powered remotes are just the tip of the iceberg. Numerous executions have been patented, prototyped and/or piloted. Social applications will enable users to share music, videos, contact information, a social network connection request or even an app. Travel applications will create virtual room keys, ID and ticket submissions and baggage check in. The list of potential functions is only limited by the creativity of the developers. NFC, a technology that is not new or particularly sexy, will open up nearly unprecedented opportunities for ad revenue and ground-breaking consumer experiences 12
- 14. 5 The Interface Revolution Luke Hamilton, Creative and Experience Lead Contributors Jonathan Hull, Group Director Steve Dawson, Technology Lead James Ashley, Technical Architect Crystal Surrency, Strategy Analyst The Mouse, as We Knew It, is Dead iPad), game consoles like Microsoft Kinect, Nintendo Wii, and Playstation Move, Once revolutionary, the 25-year dominance advanced TVs with built-in cameras and of the mouse and keyboard as the microphones, and touch-enabled monitors, main interface for communicating with all remove mouse and keyboard mediators. computers is nearing the end of its lifecycle. As a result, consumers have begun a mass The mouse, after all, is merely a pointing migration away from GUI experiences device we awkwardly use as a substitute for toward interactive interfaces that are closer the finger. We click a button when we mean to the natural human experience, also to point; we slide a mouse across the table known as natural human interfaces (NUI). when we mean to swipe; we bang away at a keyboard when we mean to simply Consumers are responding to this speak. These mediated input methods are revolution by purchasing devices driving behaviors we have learned because the NUI experiences in record numbers. Brands technology, up until now, has not been must be prepared to adapt to the demand available to allow us to do what comes most by providing experiences that leverage naturally to us - touch, speak and gesture. these interaction metaphors across multiple devices. The mouse and keyboard as input devices will still have their place for some time to By observing the tablet as one of the come –driving graphical user interfaces outcomes of the interface revolution, we see (GUI) that are relegated to more precision how content, natural interfaces, and form and data-oriented niche tasks. However, factors shape the technology of the future. smartphones, tablets (mainly the Apple 13
- 15. 5 Rise of the Tablets 3.3 million iPads sold in three months Think of the tablet computing concept this Compare the numbers of days it took these devices to way: it’s an idealized vision of a digital book, reach 1 mln units sold an object that shares the size, weight, and feel of a book or a clipboard but does so 360+ much more. Early tablet devices consisted of laptop computers with convertible 300+ screens on a hinge. These devices allowed for traditional interaction – keyboard and trackpad or stylus – when in tablet mode. 180 The operating system used on these devices was often a tablet-friendly version of a standard OS and not optimized for more 74 natural human interaction. 13 15 28 In the years following the release of the first ii S ne s od ad ry ok D W er ho iP iP bo o tablets over two decades ago, the device o kB nd iP nd et ac te N te Bl in in had failed to find mass adoption until April N N 3, 2010, when Apple released the iPad. Like nothing before, the sleek gadget popularized companies such as Intel, ARM, nVidia and a new tablet computing slate form factor: Qualcomm. However, it’s not just the no keyboard, touch-only interaction and a hardware that defines tablets. That job is new gesture-based operating system. The done by the instant-on, lightweight form combination of the hardware, software and factor coupled with the robust gesture- the established Apple eco-system helped based interface that simplifies experiences. create a neo-tablet experience which The intuitive discovery of richer content has captured the heart of consumers. been the catalyst that brought neo-tablet computing to the masses and created the Nine months later, 15.7M tablets have fourth largest consumer electronics channel been sold globally. At CES 2011, a wave overnight. of over 100 neo-tablets was announced. Not surprisingly, today’s tablets represent a multitude of fragmented form factors, Computing Without Tears resolutions, and features. From a hardware perspective, tablets are getting thinner, The various interfaces employed in the lighter and more powerful thanks to tablet category for personal computing innovation around chip technology from did not exist in the mind of the average 14
- 16. Exhibit 1 Print and Video Benefit from the The iPad could potentially become the 4th largest iPad´s Larger Screen CE category next year Content Regularly Accessed 53% 51% $30.0 44% 39% 41% $25.0 U.S. CE Catagory Sales ($B) 33% 32% 25% 21% 22% $20.0 13% 11% 12% 8% $15.0 Book TV show Movie Magazines Radio News Music $10.0 iPad iPhone $5.0 $0.0 hands, or no hands. Because of the larger s es s ad es e as Cs s TV PC er ar on on er sP iP ay dw am k ed Ph Ph Pl op oo ar screen size users have more robust ways to nc lC P3 kt ar ll eb H Ce va es M ita Sm ot g Ad in D N ig interact and explore larger amounts of content. am D G consumer less than a year ago. But the iPad Speed: Responsive, fast-loading, simple and has transformed the computer electronics intuitive apps are winning over users. industry and the way users expect to interact with digital content. In doing so, Intuitive: Tablets have opened up a new Apple has created sustained demand for a way of thinking about how we interact with product that no one knew they wanted until computing devices using inutitive gesture- it was released. based interactions through metaphors that draw from real-world experiences. But in addition to adding to Apple’s ever expanding bottom line, tablet devices are Sized to share: The shape, weight and changing the user’s expectations of what touchscreen interface enables multi-user, computing means in a number of ways. They simultaneous or sequential experiences are not laptops, nor are they mobile devices while sitting or standing. (who is really going to walk around with a tablet in their pocket?); so what makes them Curated Computing: Tablets excel at so unique? delivering more relevant and less complex experiences – consider how its personalized Size: The iPad is smaller than a laptop, but media consumption has been a boon to larger than a pocket-sized phone. Plus, the casual games like Angry Birds. The devices interface can adapt to the device orientation also allow for light productivity experiences allowing users to hold it with one hand, two like document editing and email. 15
- 17. It just works: The interface and the device One Size Does Not Fit All operate together in a way that consumers can easily learn and master. The tablet is With projections of global sales reaching closer to an appliance than a computer; +100 million units by 2012 and the plethora users expect it to work like a TV. When it’s of choices in form factors and operating on, it’s on. Additionally, you simply tap the systems, the neo-tablet signifies the screen to do something. next generation in end-user computing. However, one of the driving forces for “The fact that you can’t do everything with creating multi-purpose tablets is the ability a [tablet] like you can with other PCs - is to create and consume content on the same exactly what makes it successful” - Forrester, device. After all, the content that’s available May 2010 on the tablet is critical to the experience, whether it’s user-generated or not. Clearly, the tablet’s user-friendly touch interface, convenience, portability and high In these early days, the iPad commands degree of usability signifies the beginning of 85% of the tablet marketshare, despite the the end for a computing experience that had fact that it is often disparagingly viewed as become almost painful for consumers. With a device suitable for content consumption the release of the iPad and forthcoming rather than content creation. devices from other manufacturers, like the Samsung Galaxy Tab and Motorola Xoom, It can perform some light productivity tasks the tablet device has finally fulfilled the such as email or word processing, but the promise of delivering a truly transformative on-screen keyboard is not optimal for data computing experience. entry or programming. Additionally, the iPad owners spend a longer amount of time with their content Weekday Length of Time per Weekday Length of Time per Session by Category - iPad Session by Category - iPhone 78% 49% 44% 40% 40% 37% 34% 35% 32% 31% 32% 27%33% 24% 31% 29% 25% 31% 28% 25% 22% 24% 30% 27% 22% 25% 22% 24% 20% 19% 18% 18% 22% 16% 15% 15% 16% 7% 9%9% 8% 10% 10% 14% 11% 9% 8% 4% 7% 2% 5% 5% 3% 3% 5%9% 3% 7% 2%1% Movie TV Book Magazines Music News Movie TV Book Magazines Music News Less than 15 minutes 16-30 minutes 31-60 minutes 1-2 hours More than 2 hours 16
- 18. touchscreen interface is not ideal for editing by enabling consumers’ ability to research photos or creating commercial content. It is, products from anytime, anywhere, and however, great for surfing the web, flicking increasingly in-store, tablet devices are through photos and bringing previously becoming not only a research platform, but static experiences to life by connecting your a commerce platform. digital appliances together. For example, Disney has created a new platform that Traffic is up 77% and growth continues. leverages your Blu-ray player, wifi and tablet This is not only attributed to the ease of to create a second screen experience which use (simple, intutive interface), form factor unlocks content that allows you to control and (much better ability to view content vs interact with your movies like never before. mobile) and convenience (portability is great And while smartphones are making a huge when in bed or relaxing on the couch), but impact on pre-purchase research behavior consumers are using their devices during iPad: Is this a device for a weekend? Web browsing activity of iPad users grows significantly on Saturdays and Sundays Sunday, Black Friday, Sunday, Sunday, Sunday, Nov, 19th Nov, 26th Dec, 19th Dec, 26th Jan, 2nd 77% Nov 17 Nov 25 Dec 3 Dec 11 Dec 19 Dec 27 Jan 4 Jan 12 Jan 20 4/15 4/18 4/21 4/24 4/27 4/30 5/3 5/6 5/9 5/12 5/15 5/18 5/21 5/24 5/27 5/30 17
- 19. consumption hours when they are most • Simplify processes and tasks while likely to make purchases (prime time has maintaining rich and powerful content. always been the most expensive slot for “Maybe the new thing that everyone a reason, and now users have a device to recognizes is the unit of economic value is satisfy those sudden urges). the platform, not the device.” - Forrester, As the devices unlock additional capabilities Feb. 2011 and flexibility, there will be more producivity options for the average user. Some The rapid level of adoption has proven that companies are already working to solve this, these devices are beyond a novelty and providing peripherals that add keyboards, must be treated as a new channel that offers while others are creating dual purpose new and unique opportunities to connect tablet/netbooks still others are working on with consumers. optimizing input and interaction methods like stylus and speech support. There will also be continued exploration of form factors and To Infinity and Beyond experiences as the market matures. There are some key considerations when it comes Tablet devices are a great example of the to optimizing the end-user´s experiences: way consumers are responding to the interface revolution, but there are many • Design the experience for the particular more devices and platforms emerging in method of interaction and for the screen the market that leverage the NUI paradigm. real estate. This should include human input The technologies going beyond the touch factors, like occlusion (obstructing the user’s experience are so sufficiently advanced they view of the screen with a hand) and finger can feel like magic. vs. thumb size. Technology like Microsoft’s Xbox Kinect, • Introduce simple interactions at the leverages cameras and infrared to recognize beginning of an experience, more complex enough of your actions to enable full gesture interactions later. recognition without needing a controller or touching a screen. With the release and • Make the path to gestural learning success of Xbox Kinect the gesture control smooth, clear and direct so as to ensure that market is heating up. users understand how to maximize their own interactions. Much like the original iPhone brought touch interaction into the mainstream by • Consider the size, orientation and single or putting millions of devices in the hands of multitouch capabilities of the device. consumers, Xbox Kinect will do the same for gesture control. Imagine being able to 18
- 20. virtually try on clothes from the comfort of Autonomos Labs, they are taking this literally. your own home. Or order a pizza with a flick They have engineered an experience that allows of the wrist while sitting on your couch. you to drive your car with your thoughts alone. (George Lucas would be proud.) Gesture control technology is not just for the living room either. There is a growing All of these will continue to transform the community of developers and designers interface and in turn transform all our experimenting with these technologies in touchpoints, including in-venue retail, retail and digital out-of-home experiences. desktop, tablet, mobile or out-of-home. Gesture-based interaction is great when touch isn’t practical. For instance, on a large screen projected display it is difficult or Delight the Eye Without physically impossible to control the entire Distracting the Mind area using touch. For example, the Discovery Channel recently created an out-of-home In dumping the old mouse-enabled experience that allows users to participate interaction paradigm, the tablet and its in the story as well as share the content with bretheren have opened up a new way of their social networks. interacting with computing devices. Using intuitive actions as metaphors that draw It’s not just Xbox Kinect that’s getting in on from real-world experiences means that the fun, there are people grabbing basic web touch, gestural and voice interfaces provide cameras and creating algorithms to recognize additional opportunites to interact with moods and emotion as well as gender and customers and potential customers in more age. Toshiba has built basic face recognition personalized ways. and tracking into its laptops. Mercedes-Benz has a feature that detects drowsiness and What does this mean for your brand? the warning icon is a cup of coffee. If you’ve sat in any of the new cars hitting the market • Brands must first acknowledge that the most of them have some kind of voice revolution in NUI means that there is no control. And InnerScope Research has been “one size fits all” solution, and they will need using a biometric sensor vest that measures to adapt and interact with consumers on responses in heartbeat, skin conductivity multiple platforms or channels. and perspiration, respiration and physical motion. But wait there’s more. • Brands should not fixate on the devices themselves but rather on how they can best Some really exciting opportunities on the leverage the new interface capabilities to bleeding edge are using mind control, yes mind enhance the user experience. control, to drive experiences. In the case of a 19
- 21. • Brands should weigh the pros and cons of before possible will usher in the next native apps vs. device optimized web-based revolution, not just in computing, but in experiences, as both are expected to take design and marketing. advantage of cloud computing over the next few years. In fact, Google, Microsoft and Amazon are all betting on this as they invest even more heavily in their respective cloud infrastructures. Because tablets will have less available storage space than the typical PC or netbook, storage for tablet-based apps is expected to take place in the cloud. • Brands will need to offer deeper, more interactive content. It’s not about a single task but the customer journey. The experiences need to evolve and adapt to the consumers’ lifestyle and how they want to consume or create content. • Brands must recognize that ubiquitous, portable content will enable a better connection with consumers by being where the consumer is, no matter what platform they are using. • Connected experiences weave brands into the consumer’s life. However, ultra- personalization is the key to making the devices and content invaluable to consumers and transforming them into brand advocates. Brands that can successfully leverage these new user environments by creating personalized, natural user interfaces will build stronger and more lasting relationships with their existing customers and open doors to potential new customers. Tapping consumer buying power in ways never 20
- 22. 5 Open Digital ServicesSM: Open API Platforms Enabling Consumer-Driven Innovation Basel Salloum, Group VP, Technology Salim Hemdani, Group VP, Experiences and Platforms So after more than a few late nights, you’ve Now you’re probably thinking that it’s gotten your branded iPad app out the door. easy for those companies to open up. They It’s moving well, but it’s no, well, iPad. Your were built that way; it’s hardwired into customers seem to like it well enough. A their culture. I don’t work at an Internet few four star ratings, but there are many company. I sell physical items work at a more three and two-star reviews. You can’t large company with a big bureaucracy. It’s help wondering if it was worth the time, like comparing apples and oranges. cost and energy; and if there’s a better way to engage with your consumers, to cut to Wrong! the heart of how they understand your brand in a digital age where new devices For most brands, even the stodgiest among and interfaces are invented on a daily basis. them, there is huge potential in Open API. There is an enormous opportunity for true There is a way, and it’s the path that allow innovation by connecting with consumers companies like Facebook, Google, and and empowering them to transact with Twitter to innovate so rapidly: Open APIs. your brand on their own terms. This is All these companies have been built in no where an Open Digital Services (ODS) small part by their user communities. It’s model is essential. pretty clear by now that there’s no better way to give your consumers the digital Once the brand/consumer connection experiences they want and need than to let is established through an ODS platform, them do the innovating themselves. empowering consumers to innovate opens 21
- 23. 5 up endless possibilities. Best Buy, Amazon, public in a secure and scalable manner, using eBay and Netflix have also embraced a modular or service oriented architecture the idea of open platforms. They have (SOA) as the backbone of this platform (e.g., experimented with this new model for APIs or Web Services). It provides consumers marketing their products and services at with a highly customizable mechanism almost no cost. For instance, Best Buy´s for consuming content and executing Open APIs – BBYOpen-- allows other brands transactions through a set of “digital services” across the world to freely access product available for a wide audience such as information, store details and reviews. So developers, publishers and advertisers. ODS a developer can create an app that allows must be designed and built specifically to a purchase from Best Buy to be performed your business, it is not a product that you can right in the app itself. eBay made a similar acquire and customize, although there are move, with respect to auctions. Netflix, middleware products that could complement as another example, has incentivized its your platform architecture. community by holding a competition to build the next generation recommendation As a technology platform, a typical ODS engine. These brands are tapping into the implementation has a set of public-facing passion of the developer community to digital services that are inter-linked and further enhance their marketing cause. integrated with your existing back-end And, bear in mind, they’re all publicly-traded systems and/or third party systems. That companies for whom there is a lot at stake in integration is managed through a middle- these kinds of programs. tier “broker,” which could be a custom- built engine or a middleware product such as an enterprise service bus, which What is ODS? is primarily responsible for security, transaction integrity, entitlement and At Razorfish we have been helping clients service deployment. This model promotes build these sorts of programs since the many advantages around security, code advent of the web. Back in 1999, we helped reusability, rapid application development, MLB.com build its open video platform that ease of maintenance and much more. In aggregated all content across the clubs. addition, your legacy systems are expensive More recently we helped a large financial to maintain, modify or replace, and their services company build open feeds around proprietary APIs should never be opened up learning content. directly to the outside world. In the simplest terms, Razorfish Open Digital ServicesSM (ODS) is a platform that allows you to expose your business services to the 22
- 24. Advantages of ODS applications and ideas in the hands of your most loyal advocates—your customers. Lower cost and ease of integration: Having an enterprise-wide ODS platform will eliminate the need for direct integration ROI with each back-end system every time an application or a functionality needs to be Imagine what consumers will be able to built. The separation of existing backend do if the automotive industry provided API systems from consumers through an ODS access to Bill of Material (BOM) for every platform, will lower development cost and single vehicle they ever built? What if the increase the ease of integration. consumer goods industry provided API for nutrition details of every edible product Increased Flexibility and Agility: they market? What if technology companies One of the key benefits of this platform is provided API to a set of unique and cutting it allows companies and/or consumers to edge features of their latest R&D project? transact in a dynamic and agile manner. What if financial services companies opened Whether it’s consuming a content feed up access to product and services they or executing a financial transaction, offer? What if insurance companies allow marketers will have the ability to quickly API access to their claims data? Imagine create experiences that pertain to their the possibilities. Consumers will create consumers and provide a benefit to both meaningful and engaging experiences using parties. Over time, these experiences can these APIs on their own terms. ODS can be greatly enhanced from learning through facilitate and support the process of building iterative development cycles of consumers. a community of brand evangelists with a A framework for flexible experiences lifetime customer value that can beat the ROI ultimately results in a happy customer. of any other campaign! Additional sales and the introduction of new sources of revenue Extensibility: can be recognized through channels that are Extensibility is also a core principle and an re-using API, including suppliers, partners, advantage when users are no longer limited etc. And brand evangelists are happy too. to in-house and on-payroll developers building applications. Suddenly the new ideas landscape is virtually unlimited to all ADVICE audiences; providing extensive variety of media through many digital channels, all of Not every brand or organization is a which revolve around the user´s needs and candidate for ODS. While in most cases ODS behavior´s changes. Open Digital ServicesSM is a solution, you should first go through puts the tools for innovation, new functions, an applicability and feasibility exercise to 23
- 25. validate whether or not it’s advantageous to conflict situation arises then consider creating your business and consumers. Even if there two different services. isn’t a strong business case for it, you’d be amazed by the benefits that it can bring to 2. Loose Coupling of Services: It is inevitable your consumers. that in some instances, service output will be processed by the client in order to engage in Once you do get the platform in place, rely further transactions with the platform. After on the power of community to help you find the first service call from the client in a given new methods of marketing and expanding transaction, it is possible that subsequent your products and services. Some of the calls to other services may be highly most powerful and most used mobile dependent on values returned in previous applications are ones that were built by a calls. Despite this dependency scenario you single developer who had access to an open must always keep all of your services self- platform through an enterprise. contained and allow loose coupling that will let the client (e.g., developer) manage While ODS provides agility and flexibility the transaction integrity. Do not force the and promotes innovation, it can be complex service coupling by making things mandatory to create, not only from a technology or prescribing specific coupling mechanism. standpoint, but also organizationally. This Each service should maintain awareness of is why it’s crucial to adhere to the guiding other services offered but shall always be principles listed below. Building a true ODS independent. It is tempting to force your platform is more than putting together audience to the follow same procedures as a bunch of web services and calling it a your business does and this temptation must platform. Definitely prioritize which services be avoided to allow free thinking. you want to open up, and create a SOA based architecture utilizing a middleware 3. Industry Compliant Access Model: engine such as an enterprise service bus. Service Oriented Architecture (SOA) is a highly evolved discipline. SOA prescribes various methods, models and guidelines ODS Guiding Principles for authentication, authorization, service contract, payload management, security 1. Self-Contained Services: Any service you and service orchestration for developing wish to open up has to be self-contained. Every and deploying interoperable services. These service shall have one and only one response industry standards shall be meticulously type for all requests. Service response can be followed to avoid any one-off rules or an array of an object type but service shall practices that are specific to your company never respond with two different types of and utterly unnecessary. objects irrespective of request parameters. If a 24
- 26. 5 4. Start Small and Simple: Your business as turn to cloud computing to address their it exists today has evolved over a period concerns about scalability, high availability, of time. Your business model is no longer upfront hosting cost and time to market. as easy as buying low and selling high, ODS will no longer be optional or a nice- or introducing simple services with high to-have; it’s already becoming an industry ROI. Over the years, one-off exceptions, best practice and a key standard for internal processes, regulatory compliance, organizations. This revolution of connecting promotions, discounts and a myriad of consumers with brands will create more other things have shaped your business service providers specializing in open rules. How can you open-up APIs without architecture platforms as an offering, and considering these business rules? Yes, you it will push existing technology service will get caught-up in these discussions when providers to revisit their capabilities around identifying what products and services shall SOA based architecture and web services. be made public. The solution is to follow the rule: Keep it simple! Identify the minimum set of self-contained services that you can open and roll them out. Let your consumers define what is next. PREDICTION Some organizations will trail behind and some will not survive unless they create an open digital platform based on service or modular based architecture, and give their consumers the ultimate flexibility and agility. We’re going to see more traditional organizations overcoming their fear of certain standards around security and scalability and join the Open Digital Platforms movement. Financial Services brands in particular have been reluctant, although companies such as ETRADE*, PayPal and MasterCard have embraced it. The notion of “private data centers” and “hardware procurement” is on the path to becoming obsolete. Organizations will 25
- 27. 5 5 Marketing in the Age of Big Data Ray Velez, Chief Technology Officer Pradeep Ananthapadmanabhan, Chief Technology Officer, VivaKi Nerve Center Mark Taylor, Solutions Director, Global Solutions When we talk about information overload, • Survey-based data available from the we usually associate it with consumers Nielsens of the world who, in the course of going about their day, are smothered by thousands of bits of • Vast amounts of social data available data, branded or otherwise. But these days through open APIs and connections to marketers, too, can be overwhelmed by Facebook, Twitter and tools like Open the sheer amount of data pouring in from Social the billions of online interactions they have with their customers on an annual basis. Historically, these data sets have been Consider just this partial list of data sources: simply too large to allow any meaningful data analysis and processing to take place. • Clickstream data available from tools like Now we have new technologies to help us Atlas and Doubleclick—who have cookied make sense of and use the data. With big over 90% of the Internet data techniques, all of these touchpoints become usable assets and present an • Site or digital experience data that enormous opportunity for almost any organizations track through logs and/or organization that wants to improve the analytics tools like Omniture, Webtrends dialogue with its consumers. Technologies and Google Analytics such as MapReduce, noSQL, and cloud- based Massively Parallel Processing (MPP) • Other channel data across various databases have pushed the limits of the touchpoints (email, call center, mobile, etc.) amount of data that marketers can process without having to blow their entire budgets. • Client data This has enabled us to not just manage • Transactional data big data but to, simply, think big. We have 26
- 28. progressed from a technology culture based What to do with all this data? around constraints and managing known parameters to an environment of innovation Here at Razorfish, we have been innovating where we continue to explore the frontiers data-led marketing for years. Our DNA is of what we can do. This changes marketing grounded in data innovation, including the in a major way—not just in the technology creation of the ATLAS platform (a technology organization, but across the whole spun out of Razorfish and acquired by framework of how a company does business Microsoft) and any number of patented with consumers. But this is no cakewalk. techniques that leverage advanced analytics There is a major challenge in the form of against clickstream data. Now that we have consumer privacy, which is shaping us a greater access to big data solutions, we’re cultural issue as well as a legal one. With innovating faster. the influx of data comes great responsibility to respect customers’ information while In the past, the industry process has working to give them and your clients the been very linear: marketers plan their most efficient communications strategy campaign, buy ad space, run the ads and possible. What follows is your guide to measure the results, often with weeks in striking that balance. between each stage. Now, we test multiple Each touchpoint is an identifiable interaction and an opportunity to communicate to your customers intelligently at scale >100M interactions » Categories » Content SITE » Merchandising ~ 35+Million interactions >500M interactions » Email » Display » Billing CUSTOMER » Paid search » Mail COMMS MEDIA » email <5M interactions » Facebook 1 ½M interactions » YouTube » Site service » LinkedIn SOCIAL » Online service SERVICE 27
- 29. creative executions and media plans, among the growing crowd concerned with and immediately tweak them to deliver privacy matters. Let’s back up and define the best-performing ads and reach the targeting or, to use a more benign synonym, optimal audiences, even as measurement personalization. At the highest level, it is data starts to come in. To enable this, our using data that can be gathered from either analytics approach has become advanced anonymous web users or from people who and sophisticated enough to identify true are identifiable because they’re logged into relationships across the data that will be a website. This process allows us to create meaningful for consumers and profitable for consumer segments and those segments clients. are used to create relevant experiences. For example, if the data tells us that you are in Amid the vast sets of data, it’s the tiny a particular segment and we know that that subsets that have the most significant segment is interested in mountain bikes, we impact on our customer interactions. We can show you mountain bike experiences have already altered the way we design our instead of road bike ads. Think about it analytics and data management solutions by this way—lots of data sources map into initiating strong measurement and KPI [key segments, and segments drive experiences performance indicator] strategies alongside and messages anywhere you can create our technical solutions to drive our clients’ experiences where experiences are driven? business goals. In our experience, just about every display These Razorfish-led innovations ensure ad is somewhat targeted and personalized. sound business logic and measurement Have you ever noticed that when you start techniques combine with our Business looking for a product, ads for that product Intelligence to drive down latency to a start showing up more often? Combating the near real-time basis, creating an almost low clickthrough rates challenge of display immediate feedback loop. The renaissance ads, advertisers have used targeting data in data-driven display ad planning and for years. However, it is far too rare that measurement is just one example of big data this data and targeting information is used in action. beyond display ads, and leveraged across multiple channels, from websites, to mobile, Targeting or Personalization to email, to social applications, and beyond. Often times someone will click through Targeting is one of those hot-button an ad to end up on a web experience, and marketing terms that means different things all that wonderful information that was to different people. Its vaguely threatening available in the ad never makes it to the sound doesn’t hold – no one wants a desktop or mobile site, or even in-venue bullseye on them after all – especially kiosk. That is the opportunity we have here. 28
- 30. Privacy of communication. You wouldn’t ignore the information from a conversation Since data is so abundant, it’s critical with a customer in the store or on the to ensure that all data practices follow phone, would you? And, quantitatively, privacy laws that govern whether and how we can increase relevant and meaningful personally identifiable information can be engagement time, increase conversation used. Netflix learned during a contest it and increase referrals—all of these metrics created so its community could develop a leading to increasing revenue. It takes a new recommendation engine that even with focused effort and time to correlate metrics, large, highly anonymized data sets it is still but you are creating a framework that possible to identify a unique user. That is enables understanding of the impact of probably the best way to think of personally the targeting updates. Inevitably some will identifiable information: date that can increase and some will decrease. identify a unique person when it is captured. If that person has opted in, you can store Our clients have seen huge benefits within you the data. If there was no opt-in, you’re single channels like display where near out of luck. Most wide-scale segment real-time marketing decisions generate data providers, like ad servers or firms like increase in relevancy and conversion. The Nielsen, enable the capturing and sharing of next phase of benefit realization is being anonymous data in a way that is consistent seen in cross-channel intelligence combined with U.S. legal and general consumer with targeting across multiple touchpoints. guidelines. Often times this is enabled with This provides an incremental return-on- anonymous user cookies. However, it is insight that is in turn leveraged to drive important to note that Europe is looking greater relevancy, while improving delivery at anonymous segment data in a different incrementally across channels that are way than the U.S. The EU Privacy Directive typically working in siloes. may require that users must consent before placing an anonymous cookie. The final interpretation is due out in April. Platform Led Process This is truly historic times for marketing. Where’s the Value? Just a couple of years ago the tools to comb through colossal data numbers were From a customer perspective, a qualitative not available. Trillions of rows of data and benefit comes from the fact that you petabytes of information are created daily are observing and listening to your and in some cases every hour or less. And it is consumers. Every action or piece of only growing. Traditional RDBMS would choke information a customer provides is a form and fail on numbers of these sizes, or would 29
- 31. Big Marketing: Moving past single channel siloes to drive customer-centric insights and experiences. From behavior in a single channel or To a holistic view of the customer and session or by product (for example: segment groups over time conversion, visits, orders, etc.) be prohibitively expensive and fragile. But • Google making its MapReduce algorithm having the capability is only part of the story. publicly available. This is the algorithm that allows Google to index the vast swaths of To do this right, process is key. The data data across the web in a distributed fashion warehousing technology landscape has using thousands of servers across the world. traditionally been dominated by two types of solutions: • Yahoo open-sourcing Hadoop—an implementation of the MapReduce 1. Traditional databases such as Oracle, SQL algorithm—thereby making the power Server, Informix etc. These are used when of “MapReduce” and big data processing data size is on the order of gigabytes available to the world at large. 2. Data warehousing appliances such as • Amazon launching a cloud-based Teradata, Netezza, etc. These are used for data implementation of Hadoop through their processing needs in the terabytes. Elastic MapReduce service, solving the Datawarehouse appliances, with their massively problem of getting access to large amounts parallel processing capabilities, can be quite of hardware on an as-needed basis to run expensive and so were not unaffordable for Hadoop for large data processing needs. most marketers. However the landscape has changed dramatically over the last five years These developments provide the ability to primarily due to a few developments in the data process data in the order of petabytes at processing world in general: vastly lower price points than previously 30
- 32. available and in a much faster and more jobs were taking more than a day to process flexible manner. For example, at Razorfish and the situation was getting worse with we have been able to bring down the time every passing day. Fast forward to 2009 it takes us to process 90 days’ worth of where the Hive/Hadoop cluster at Facebook Atlas cookie data (a data set that could be stores more than 2PB of uncompressed data 5-10TB in size) from an average of 15-16 and routinely loads 15 TB of data daily! hours to 3-4 hours by using Amazon’s Elastic MapReduce service a roughly 400% increase Finally, new types of Massively Parallel in processing speed, not to mention the Processing or “analytic databases” such cost-savings gained by moving to a pay-per- as Asterdata and Vertica, which leverage use service and the elasticity to increase the MapReduce/Hadoop technologies in the number of servers needed at will! cloud, offer another attractive alternative to marketers. They offer most of the The other important development is the benefits that commercial data warehousing emergence of what are called “noSQL” appliances have traditionally offered but at databases sporting names such as a lower cost and with the flexibility that a Cassandra, membase, CouchDB, etc. These cloud-based architecture can offer. have been developed primarily to meet the massive data storage and processing needs For Best Buy, Razorfish was able to leverage of social media firms such as Facebook, Amazon’s implementation of Hadoop, Digg, and Zynga. In simple terms, noSQL Amazon Elastic MapReduce, and use it to databases offer extremely fast read/write generate amazing results. We created about capabilities at the cost of not guaranteeing 36 different personalization segments for ACID (Atomicity, Consistency, Isolation the retailer. Those segments were able and Durability) properties associated with to drive close to 2 million personalized traditional SQL databases. These databases messages. We would import about .5 offer marketers a solution to scenarios trillion rows of data into 100 machines AWS where speed and volume are more EMR cluster on demand to personalize our important than accuracy. experiences. This all happened in about 8 hours a day and resulted in about 500% To get a sense for the data processing return on advertising spend. Doing this with capabilities that these technologies old world big data technologies would have have ushered in, consider this: Facebook taken weeks to months simply to get the started with a commercial RDBMS-based servers provisioned. And the servers would infrastructure that began to crumble sit around idly between sessions. when it reached around 15TB in size. The infrastructure at that time was so inadequate that some daily data processing 31
- 33. Practical Implications understanding of the same customer groups interacting across multiple touchpoints in a It’s a fundamental rule of statistics that non-personally identifiable way. the larger the sample size you use for your calculations, the more accurate the results. A good example of a channel whose data set Marketing intelligence is no exception. As works at different frequencies and velocities previously mentioned, marketers have been is social media. Social can pose a number traditionally constrained by the amount of of unique challenges from an analytics point data that they could look at to understand of view. For one, it is very real-time. Ideas their consumers and predict their future are formed, enter the collective stream behavior. That is, until now. of consciousness, and can propagate very quickly. Marketers therefore need to react The timing couldn’t have been better. As in real-time to happenings in social media if consumers spend more and more time they want to effectively communicate their online there has been an explosion in the message, especially in cases where negative digital exhaust that accompanies their online feedback about the company is involved. activity. A majority of online cunsumer Real-time analytics is therefore critical as activity is also social in nature—from it can help steer the marketer’s focus and tweeting about their latest obsession to attention to where it is most needed at “liking” the hottest new restaurant in town any given point in time. Unlike a traditional to watching videos of a family member’s media campaign where a message is created most recent vacation. From a marketer’s and mass-delivered to the target audience, point of view, the deeper they can look into social media campaigns involve continuous a customer’s social activity, the better they interaction with the target audience can target their marketing programs and throughout the duration of the campaign. maximize the ROI on their budgets. Given this scenario, it’s vital that the A critical component is to think about marketer is able to gauge the reaction to the how your new data architecture will bring campaign throughout the process, instead all these data sets together for targeting of at the end of the campaign, and make and still retain a usable and meaningful modifications as appropriate along the way. understanding of your customer. To create a Social media analytics also need to factor in line of sight to your customers, regardless of processing of unstructured data to be able channel, depends on harmonizing disparate to paint a complete picture of the customer. data sets, recognizing that they are available It’s not enough to know the “volume of and that they refresh at different frequencies buzz” your product is creating. It is also and velocities. They must be organized vitally important to understand the nature of on a unique level to ensure a greater the buzz. For example, you need to be able 32
- 34. Platform approach for data-driven, targeted branded experiences EXPAND OUR ABILITY TO REACH THE EXPERIENCE PROSPECT AND COSTUMER CREATE A PERSONALIZED, RELEVANT COMMUNICATION ACTIVATE SYSTEM CARVE THE AUDIENCE INTO VALUABLE PROFILES AND ANALYTICS SEGMENTS CONNECT ALL OF THE DATA SOURCES TO CREATE A PLATFORM SINGLE VIEW OF THE COSTUMER MEDIA SITE CUSTOMER SOCIAL CLIENT DATA DATA COMMS DATA DATA to parse a tweet like, “Flight delayed, yet In order to work, our systems will need to again. Gotta love United!” and determine become absolutely transparent and it’s critical it to be one that needs to be counted as that we design solutions that factor this in. negative sentiment. Consumers need to understand the power of their actions and interactions with brands and, in the long-term, we need to do our best Brave New World to make these things clear for consumers as well businesses. The future really is in the hands of those who are set to benefit the most: consumers. Today, we are finding huge potential in our Consumers will have access to much of the big data solutions to execute compelling same data that companies have historically personalized experiences and relevant only had access to. This is a shift from B2C messages, but consider our next-generation (Business-to-Customer) to a more C2B personalization where open innovation is a (Customer-to-Business) model, enabled norm. We are already thinking about how fundamentally by big data management. we can help our clients develop experiences 33
- 35. for consumers who are increasingly able to connect with your employees, compliment or complain about your company or redesign the product or experience. They can influence thousands of customers in real time with a simply click, more effectively than a corporation can with a million dollar media campaign. Historically power resides with governments. Now powerful entities are increasingly multifaceted influencers brands and individuals who even can influence the geopolitical landscape with social media such as in the Middle East revolutions. Once we move big data solutions from simply doing the same thing better (improving messaging), and start embracing customer dialog and crowdsourcing as part of our business, marketing and data process, then we will see radical change in the relationships between companies and people. Companies like yours will be turning to innovation to compete in the race to win and retain consumers by using big data techniques that embrace people’s interactions and their explicit voice. Ultimately what benefits the customer will benefit your brand. 34
- 36. 5 The Cloud’s Influence On Enterprise Architecture Ray Velez, Chief Technology Officer Jibi Scaria, Technology Director Mandhir Gidda, Technology Director Introduction companies like O2, Netflix, and others are reaping huge advantages in cost, scalability, During the past few years, business has security, performance, and fault-tolerance. had its head in the cloud. We’re not And that is just the beginning. In many cases talking about not paying attention to these large infrastructures are building on your surroundings, though some could be what startups and marketing campaigns accused of that too. We’re talking about have already learned. the vast shift away from physical servers to a more flexible system. Moving to the In this article we will talk about these cloud is demanding new web application business and technology architecture architectures and changes to the way we do changes. In essence, the business business planning. Cloud infrastructures act advantages will force adoption. Forcing more like software and less like rigid physical change at the infrastructure level is difficult, devices. Security can be an issue, but these but the benefits are too great to ignore. setups can be more secure than traditional approaches. Technologies like Amazon Web Services are forcing architectures to Business Changes be able to deal with IP addresses that may change without notice or a backup plan So, why are businesses excited about that leverages two different cloud services moving to the cloud, other than it being a for better redundancy. Architectures that priority for CIOs? The first consideration is depend on traditional datacenters aren’t in a capex vs. on-demand. The cloud has been position to take advantage of cloud services referred to as a utility payment model i.e. it and addressability. Large infrastructures at works more like your electric bill. 35
- 37. 5 You only pay for what you use. Traditional and your infrastructure scales without computing resources were purchased either administrator intervention. That was never ahead of or below business needs. Basically possible with traditional hardware, which you paid for a computer and everything that required someone to procure, install, and went along with it in terms of space, HVAC, configure hardware ahead of time. There operations, etc. whether you used it or not. was always the guessing game about how In the new cloud computing world, you pay much traffic a campaign would drive. for only what you use when you need it. If With the unpredictability of social traffic, everyone stops using a computer at night, organizations need to be prepared. Look you could even shut the operation down and at the huge increase of social networks restart when folks are back to work. We have and imagine what happens when your site only started to envision the new use cases. experience dives into that wave. Rising Unique Twitter Unique Facebook ity Capex demand ac scenario ap 100% increase rc de ty ci un pa users in million users in million Capacity 500 ca 100 100 er ov 92.87 Falling 90 90 demand scenario 60 60 250 Time 44.52 40 40 Demand Classic Capacity Cloud Capacity 20 20 0 0 The big impact here is on an organization’s June 09 June 10 July 09 July 10 budget. Often times organizations will allocate dollars for hardware even if they don’t use it-the inefficiency that got Rackspace put it best: moving to the cloud is a Amazon into this business, t he retailer was revolution, not an evolution. They list four main trying to figure out what to do with all the areas that are changed thanks to the cloud. hardware it needed to be ready for the holiday buying cycles. Now organizations • Virtualization – The ability to increase don’t have to budget ahead of the cycle computing efficiency and instead keep pace with business -- even scaling automatically on demand. • Democratization of computing – Bringing So, your marketing team purchases media enterprise scale infrastructure to small and or keywords, causing a spike in traffic medium businesses 36
- 38. • Scalability and fast provisioning – Bringing and now we are seeing commerce in the web scale IT at a rapid pace cloud. Increased compliance standards on the cloud will help allay concerns and • Commoditization of infrastructure – continue to grow adoption. Enabling IT to focus on the strategic aspects of its role New cloud technology architectures are enabling amazing innovations and driving All of these factors are increasing the pace at business at a faster pace than ever. We are which companies are moving to the cloud. seeing innovations that are happening in We are seeing this tangibly on an almost real time that we never would have thought daily basis. The number of websites using possible. Organizations, like Etsy and Flickr Amazon Web Services and Rackspace Cloud are using the cloud to release code to their Services is exploding at a meteoric pace. production environments very frequently, From the start there have been concerns sometimes even daily. Many large around security. The greatest concern is enterprises are pleased if they can launch really about the security practices that code to production environments once a a cloud provider follows. The best way quarter. The low cost and rapid turnaround Number of Websites Amazon´s Virtual Computers Using Cloud Providers Created Per Day 4000 3 month moving average 3500 94% Growth 106% Growth August 2009 100.000 August 2010 3000 1500 80.000 2000 60.000 1500 146% Growth 188% Growth 40.000 1000 500 20.000 Amazon EC2 Rack pace Cloud GoGrid Linode Servers 2007 2008 2009 2010 to prove these processes is by following enables us to make decisions based on real- auditable processes that have passed key world working software instead of document standards. For example, when the cloud speculation. We can have working servers in providers started they didn’t have Payment the cloud in less time that it takes to reboot Card Industry(PCI) compliance. As expected most laptops. The cloud enables what users not much commerce was happening on the and business experiences have always cloud. They’ve now added that compliance wanted, experiences that learn from users 37
- 39. quickly. I think Werner Vogels, Amazon´s traditional datacenters. I really liked the CTO put it best, “The cloud lets its users architecture he laid out:. focus on delivering differentiating business value instead of wasting valuable resources Old Datacenters vs. on the undifferentiated heavy lifting that New Cloud Arch makes up most of IT infrastructure” Central SQL Database Distributed Key/Value NoSQL Sticky In-Memory Session Shared Memcached Session Technology Architecture Change Cahtty Protocols Latency Tolerant Protocols Tangled Service Interfaces Layered Service Interfaces We’re about to get really technical. So if Instrumented Code Instrumented Service Patterns you don’t know your Hadoop from your Fat Complex Objects Lightweight Serializable Objects chatty protocols, you might want to fire up the Angry Birds. Otherwise, read on. Over Components as Jar Files Components as Services a decade ago when server virtualization *from Netflix slide share by Adrian Cockcroft software like VMWare and later Zen was introduced it was hard to predict the Let’s look at these transitions, one by one: massive impact it would have on physical technology infrastructures. In fact, it has Central SQL Database becomes a taken us close to a decade to start to harness distributed key/value NoSQL approach its potential. At its core, what virtualization – the central SQL database has been the and modern day cloud computing APIs weakest link in traditional data center have made possible is the ability to treat architectures. RDBMS clustering is a complex physical hardware more like software. Cloud and difficult task, with the number of nodes computing allows us to automate more than in a cluster eventually being finite. NoSQL ever before - enabling greater automation or distributed key/value-based databases for system recovery, monitoring, scaling, systems are built from the bottom-up for and even software application deployment. scaling. Technologies such as Hadoop or However, to really enable these things we Amazon’s implementation of Hadoop, have to cut the chains to the old ways of Elastic MapReduce, enable scaling without doing things. Rigid three-tiered architectures limits. Of course this has had a huge impact based on traditional SQL Relational on how we treat our data, but provides a Databases have to change. scalable alternative. If your data still requires relational elements, than the traditional Recently, Netflix’s cloud architect, Adrian RDBMS with techniques like sharding or Cockcroft, did a presentation that he shared memory caching layers like Memcached or on Netflix about the changes that come Microsoft’s Velocity will help, but NoSQL from using the cloud when compared with provides a much simpler alternative. 38
- 40. One of the biggest issues with traditional volume of data however has been growing RDBMS is that new releases or schema exponentially, as has the compute power changes often require some complex way to required, necessitating an entirely new take the RDBMS offline, update it and bring approach. We have chosen to use Amazon it back online. Often times it is easier to take EMR consisting of the Apache Hadoop/Hive/ the site down for a short amount of time. HBase product sets, to host and process With NoSQL, there isn’t a schema to change, the increasing data volumes. This approach so there is no outage. Our own experience makes the most use of Amazon’s cloud of working with O2 on a telecommunications offering, as well as the frameworks that product catalogue has lead us to consider others have positioned on that cloud e.g. a NoSQL solution as the natural path in the NoSQL databases. ecommerce platform evolution. The O2 business model and the types of products Sticky In-Memory Sessions become shared that it now sells includes not only handsets, Memcached sessions – traditionally, load tariffs, and accessories but broadband, balancers use sticky load balancing to avoid games, ringtones, consoles, financial having multiple application server nodes services, content, and could progress onto share in-memory sessions. This usually many other yet-not-envisioned physical and happened because it was difficult to get logical product offerings. We have been application server nodes to share session looking at NoSQL ‘Graph’ databases as a data or it was inefficient to store session data way of modeling products, their attributes, in the database. This forced odd workarounds relationships, and eligibilities to customer that would drive our services to get heavy segments in an attempt to develop a to avoid round trip requests. Enter the more product catalogue that can continue to offer flexible cloud design pattern that uses round- flexibility as the business evolves. robin load balancing. This requires external shared caching, but increases application As we have learned from Google’s approach, redundancy and encourages better design of dealing with colossal data requires a lighter weight services based on REST. This departure from traditional fixed servers leads us to the next traditional data center and RDBMS. Traditional databases have anti-pattern, chatty protocols. physical limits on server clustering . NoSQL is based on an unlimited scaling model. Chatty Protocols become latency tolerant Consider Razorfish’s own EDGE platform. protocols – traditional protocols required Historically this application and its data and expected internal networking low would have made exclusive use of Enterprise latency requests, often based on serializing level database infrastructure, hosted in a Java objects. Satisfying one use case means proprietary datacenter with an appropriate that the client has to make more than one ‘disaster recovery’ configuration. The request - typically a series of requests - to a 39
- 41. service layer to obtain the final result. This Fat complex objects and components as is slow and inefficient. This usually happens JAR files become lightweight services and when both objects and service layers are too serializable objects – focusing on a layered fine-grained, so finding the right balance for approach to exposing your services, both the service layer - between coarse-grained externally and internally, helps you build services and batch requests - is critical. New flexible and scalable architectures. It’s easy lightweight protocols like REST and JSON to look at Java or JAR files as ways to publish allow for a lighter way to define services new services, but that drives an architecture and share objects. Building technology that tries to build everything into one architectures that support asynchronous overweight object. Long term this decreases services and efficient caches makes this maintainability. As with many things, strive possible. As with many of these innovations, to keep things simple and focused in your these approaches were built on the heels architecture. of great traditional architecture advances. The cloud pushes us to adopt these best In summary, the core design guideline is to practices more aggresively, given the cost keep your design architecture resilient to savings and the push to do more with less. failure. As described above there are too many areas in our traditional architectures Tangled Service Interface becomes layered that are fragile. To truly take advantage service interfaces – as mentioned earlier, of the cloud we need to weed out those traditional technologies like Spring and weaknesses, which will eventually enable us Java have provided the platform to jump to focus more on business value and less on to the cloud based architectures. The key keeping the infrastructure up and running or design principle to follow is to decouple scaling up for new business. your business logic from your data layer, for example. Learning from Netflix and their outstanding APIs, build service layers that have two core components - one is the SAL or service access library, providing basic object serialization on top of the business logic. The other is to provide an ESL or extended service library, that enables caching, promotes consistency and helps developers better understand your API intent, avoiding misuse. The layered service interface allows us to use instrumentation service patterns instead of mixing instrumentation logic with the core business logic. 40
- 42. 5 Looking Ahead: Predictions from our Authors NFC • Connected experiences weave brands into the consumer’s life, but ultra- • NFC will be used to provide real world personalization is the key to making the interfaces for our digital handsets, experience invaluable to consumers and connecting ourselves with transportation transorming them into brand advocates. and public services, retail touch points, digital signage and other physical objects. In the long-term we will be able to find tags Open Digital Services in urban areas just about anywhere. • More and more brands will look beyond • NFC coupled with motion-enabled the construct of paid, owned and earned technologies will help move creative media to embrace open and innovative experiences out of the home and into ODS models as part of marketing efforts. public areas. • In the next three years, all • NFC will be adopted at a much faster pace major brands will have a de-facto than expected, even while standards and “developer.<brandname>.com” property to approaches are being worked on by the big support community participation. three: Apple, Google, Microsoft. Social Analytics Interfaces • Big Data is clearly becoming a top IT • Brands that successfully leverage priority as evidenced by IBM’s acquisition new user environments by creating of Netezza and HP’s acquisition of Vertica. personalized, natural user interfaces will build stronger and more lasting • The role of ‘Data Scientists’ is going to relationships with customers. become more and more critical for a lot of companies across industries. 41
- 43. 5 • Being able to interpret and glean insights from data will be just as important as collecting, monitoring or listening to it. The Cloud • Cloud vendors will be more compliant with standards like PCI and others driving faster and greater adoption. • Enterprises that don’t embrace the cloud will lag among the competition. 42
- 44. About Razorfish Razorfish creates experiences that build Visit www.razorfish.com for more businesses. As one of the largest interactive information. marketing and technology companies in the world, Razorfish helps its clients build Follow Razorfish on Twitter at @razorfish. better brands by delivering business results through customer experiences. Razorfish Learn more about the Razorfish 5: combines the best thought leadership www.razorfish5.com of the consulting world with the leading capabilities of the marketing services industry to support our clients’ business needs, such as launching new products, repositioning a brand or participating in the social world. With a demonstrated commitment to innovation, Razorfish continues to cultivate our expertise in Social Contacts: Influence Marketing, emerging media, Ray Velez creative design, analytics, technology and Global Chief Technology Officer user experience. Razorfish has offices + 1.212.798.6610 in markets across the United States, [email protected] and in Australia, Brazil, China, France, twitter: @rvelez Germany, Japan, Spain, Singapore and the United Kingdom. Clients include Carnival Cruise Lines, MillerCoors, Levi Strauss & Co., McDonald’s and Starwood Hotels. With sister agencies Starcom MediaVest, ZenithOptimedia, Denuo and Digitas, Razorfish is part of Publicis Groupe’s (Euronext Paris: FR0000130577) VivaKi, a global digital knowledge and resource center. 43