Modern technology, especially web-based, enables companies to offer highly personalized products to its customers. Meaning, companies are able to offer the most suitable and the most appropriate products to its customers – based on behavioural and individual attributes of every prospective or every existing customer.
We actually live in the world where companies, such as big online retailers, offer us the most suitable products, based on information we provided about ourselves and based on the actions we take or we took with our internet browser. So, it is not uncommon to get recommended products by visiting the website of specific retailer, which highly reflect that what we searched a couple of minutes ago, using our search engine. The idea behind this concept is, more or less, well-known today. You tell something about yourself by providing direct information into customer account, or you tell something about yourself by taking specific actions with your browser, such as by searching for a specific term using search engine. Various algorithms process those information, using existing mathematical and computing methods, and apply specific attribute to you as a website visitor. This attribute, or a group of them, describe you as a customer and enable the retailer to offer you the most appropriate and the most suitable product, which they have in their product catalogue. However, despite the fact that the huge number of the companies still struggle to introduce such and similar digitalisation-based concepts with their online platforms, the new trend will emerge in the next few upcoming years, which will not make previous concept outdated, but will certainly extend it and take over the primacy. It is the concept I like to call “smart dynamic product”, or SDP for shorten.
The term “smart dynamic product” (SDP) represents an idea where products, with all their attributes, actually don’t exists in their final selling or imagined form. Thus, the products and their final selling properties are not previously defined, developed or functionally realised by the business. Products, their forms and attributes are defined on-the-fly and proposed to the customers during and based on customer current activities. And of course on the basis of customer profile attributes where and if possible. They exist only at specific moment and are functionally realised only if the customer orders such product. This concept is similar to the CPQ (configure-price-quote), however it is not the same, as it goes one step further – it does not require a catalogue of existing products. As already mentioned, products don’t exist and are defined and proposed on-the-fly.
Smart Dynamic Product is an approach that enables on-the-fly definition and delivery of highly individualised and personalised products, but really personalised products, where customer gets the specific product that fits only her or his needs. This approach is future for energy supply companies, internet providers, telecommunication, and other similar companies that deliver products that could be highly customizable on individual basis. For example, to enable on-the-fly definition and proposition of the new, more appropriate and more functional electricity-based products, energy supply companies could use individual customer energy consumption information in combination with the information what kind of an electrical vehicle has customer searched a few moments beofore, using Google or a specific car dealer website.
However, the challenge is not why and where to apply the concept such as “smart dynamic product”, but how. To enable such concept, a specific technical environment is needed that supports product self-definition based on various inputs, by applying appropriate computing algorithms and mathematical calculations; however, in the scope of given constraints. Arguably, from mathematical definition perspective the concept is not complex as it seems to be; however, its technical implementations would be massive. A few of the world leading online retailers are trying to conceptualize similar approaches, and one is for sure, we will see some artefacts, and probably be able to experience them in the near future.
Cheers!