Personalize or die? 3 ways large companies can embrace startups way.
People expect personalization. Everybody needs and expects personal, customized, well crafted products and services. Startups already knew that, large companies learn fast.... embracing startups ecosystem.
Coca-Cola invested in AI driven restaurant in Singapore.
In this restaurant (software which manages it) collects a lot of data about us. So the menu, the service, menu, recipes can be highly personalized by artificial intelligence. Moreover, the more I come to this place, the more the restaurant will learn me preferences. Scary?
If you look at the food processing and food tech industry, you can see examples like Nestle investing in the DNA project. They want our DNA to drive personalization on their side. How does Nestle approach it? They want you to share your DNA with them. Nestle will send you a kit with the request of sharing your most personal data - DNA. After you complete this task, Nestle will send you a highly personalized diet. At this point think about fitness industry. Nestle technology and business model around can be a deal-breaker. It can be a disruptor to a fitness industry which is about personal trainers, diets, exercises and gym programs. It can change how we fight allergies or use drugs.
Lick the paper and I will tell you who you are.
So Nestle wants our data to deliver personalized diets, which is only a first step from disrupting many markets (food processing, food delivery, allergy medicines).
Few days ago Apple acquired a startup that is able to predict if the new Justin Bieber will be born somewhere in the cyberspace. There's a startup which technology is flying around the net and it knows how to find the next big artist, which can be born soon somewhere on YouTube, Instagram, Facebook, Spotify etc.
Think about, if you are a large company, what kind of personalization you can quickly drive with startups. Personalization is startups DNA. Startups can't afford selling general products, everything needs to be personalized. Otherwise startups will die. It can't deliver value without personalization.
Think about WeWork, Uber, Spotify, Slack, all of those companies try to gather so much data and personalize the product. Personalization of offering is easier for start-ups because they stay small and flexible, so they can digest data quicker and listen more effectively. You need to have flexibility. Good thing is, you can bring it to the corporation world.
How to bring flexibility to large company? Hire startup or run your own.
Think about Coca-Cola, Nestle's, Apple. These companies embrace startups ecosystem often and globally. There is another great example - McCormick in the United States. The company almost turns itself to be an algorithm. Whole company is data driven. It builds software and data structure that is able to analyze what kind of recipes people read and study. Let's say I am chocolate, peanut butter, meat, avocado and rice guy. McCormick's algorithm creates a circle of food prints. I am those prints. I can be described by 5 - 7 different flavors. It's a huge value for restaurants and hotels to personalize a diet, menu and room service.
Data drives personalization but how to get that data? Some companies buy startups. Some of them, like McCormick, run their own startups.