“Obstacles don't have to stop you. If you run into a wall, don't turn around and give up. Figure out how to climb it, go through it, or work around it.”
—Michael Jordan
“There is no spoon.”
—Neo from The Matrix
I recently moved to the Bay Area to be at the epicenter of all the disruptive innovation being generated in Silicon Valley. “Disruption” has unfortunately become somewhat of a dirty word for many these days, conjuring up images of ruthless tech companies making traditional business models obsolete. Being a lean marketer, my view of disruption gravitates toward a classic definition. Revisiting my ninja metaphor, ninja fighters were skilled disruptors of conventional warfare, allowing them to successfully combat larger, established armies. According to Clayton Christensen, a professor from Harvard Business School, “disruption” in a business context describes a process whereby a smaller company with fewer resources is able to successfully challenge an established incumbent business.1
Leveraging disruptive technology is not a new idea. In fact, one of the key factors that contributed to the early success of McDonald's in the United States was its decision to place stores where it could take advantage of the emerging interstate highway system. President Eisenhower's Federal Aid Highway Act of 1956 created 41,000 miles of new interstate highway and lots of hungry drivers looking for a clean and convenient place to stop and take a break.2 McDonald's leveraged the expanding interstate highway platform and strategically placed its restaurants next to interstate off-ramps. The rest, as we all now know, is fast-food history.
In Chapter 5, we looked at the history of the Minute Maid brand. One of the key reasons the brand became so successful in the United States was because it was the first juice company to leverage a new type of freezing technology. This innovation allowed the brand to distribute “fresh” tasting orange juice throughout the entire country, regardless of the season.
The Minute Maid launch in China once again took advantage of new technology. This time, Coca-Cola developed a manufacturing process that enabled the juice to create a “pulpy” texture that emulates the consistency of fresh orange juice while reducing expensive juice content to 10 percent.
Equidam, a leading provider of online business valuation services, surveyed more than fifteen thousand companies in seventy-eight countries ranging from high-tech startups to well-established businesses. Equidam found that the average company forecasts an amazing 120 percent growth after year one, 82 percent after year two, and 60 percent after year three.3 Now contrast that to the historically low average sales growth rate for the S&P 500, which is roughly 3 percent annually.4
It makes perfect sense that businesses just getting off the ground can achieve higher growth rates because they are starting from a much smaller base. However, as companies become more established, it becomes harder for them to continue to grow at that same rate.
In 2018, Tesla forecasted 33 percent annual growth,5 while Airbnb predicted it would double its annual stays,6 and Uber's bookings have been growing at more than 100 percent a year.7 Each of these companies entered a well-established category like automobile manufacturing, transportation, and hospitality, and then disrupted the status quo.
In much the same way, when you are building a new brand in a developing or emerging market, you have the rare opportunity to quickly adopt disruptive technology and create a step change in the traditional growth curve.
Existing brands often get stuck focusing on maximizing the return on the investments they have already made, motivated by incentives to do business in the same way they always have.
According to a 2018 survey of top US marketers by Deloitte, Duke, the Florida School of Business, and the American Marketing Association, marketing budgets only increased 7.3 percent in the past twelve months. They were expected to improve marginally to 10.9 percent in the following year.8
However, it takes a lot more than increasing 10 percent here or optimizing 10 percent there to create a step change in growth. The good news is, as a new market entrant, you are less likely to be anchored to legacy investments. That means you have more freedom to ride disruptive technologies that can give you a competitive advantage.
Today there are many disruptive platforms that can become a catalyst for step-change growth, but if you want to create a competitive advantage, you must act early and fast. The problem is not predicting which technology will affect your brand but selecting which technology's growth you can ride on. That's why it is important to stay current on emerging technologies, especially those outside of your product category.
Figure 7.1. Applying disruptive platforms to the branded product value chain.
Although it may seem that some of these platforms have been around for a long time, continuous improvements in functionality and reductions in technology costs have pushed many of them to the tipping point. Examine the links in your brand's value chain and ideate with your team on how you can add value to each link by leveraging a potentially disruptive platform (see Figure 7.1).
In the following section, I have listed many platforms that have the potential to be disruptive when entering an emerging or developing market. Nevertheless, you should begin compiling your own list that you can add to whenever you come across a new technology that you believe has potential.
The Internet of Everything (IoE) refers to how more and more products are designed to allow them to be intelligently connected to each other and the Internet. Imagine a future where everything is connected, facilitating communication and learning between people, people and things, and even between things themselves.
The analyst firm Gartner says that in the near future there will be more than twenty billion connected devices.9 Intel's estimate is even higher, forecasting two hundred billion connected devices for the same time frame. That would equate to about twenty-six smart devices for every man, woman, and child on the planet.10
There is no doubt that the implications for IoE will be far-reaching and provide a catalyst for creating disruptive value for brands entering new markets. The following are a few examples showing how brands leverage IoE.
One of the primary challenges that global brands face in developing markets is obtaining visibility on who their end-users are—gaining a clear picture of consumers so brand builders can use that understanding to provide meaningful, brand-building content and solutions.
Coca-Cola's Freestyle platform received a lot of attention for offering more than one hundred different flavor options to consumers, as well as allowing consumers to create their own recipes. What often gets overlooked in all the excitement is Freestyle's ability to communicate data back to Coca-Cola and other stakeholders such as restaurants and retailers.
The Freestyle machine uses microdosing technology and flavor cartridges that resemble the ink cartridges found in color laser printers. Because Freestyle machines are connected to the Internet, they are able to automatically place orders for replacement cartridges and other supplies to reduce the losses that result from out-of-stocks. Additionally, the machine is designed to introduce new beverage flavors with a simple overnight software update. Consumers can even download a mobile app that allows them to save and share their favorite creations using Quick Response (QR) codes (see Figure 7.2).
Figure 7.2. The Coca-Cola Freestyle App with more than one hundred choices. Photo credit: Amy Hsu
Armed with consumer usage data, Coca-Cola can introduce new flavors that have been “co-created” and validated by real consumers.11 Recently, Coca-Cola North America launched Sprite Cherry and Sprite Cherry Zero into retail shops based on data obtained from the Freestyle platform. Bobby Oliver, director of Sprite and citrus brands in North America, said, “The fact that cherry was the number-one Sprite flavor mix on Coca-Cola Freestyle inspired us to create an all-new, delicious product for fans in a convenient, on-the-go bottle.”12
East-West Seed (EWS) is a leading global seed manufacturer headquartered in Thailand, specializing in serving the needs of small vegetable farmers around the world. The company's mission is to help farmers improve the quality of their lives and the communities they live in. So it is not an exaggeration to say that EWS is doing something very important for the world. It's estimated that roughly 2.4 billion small farmers produce about 70 percent of all the food that is eaten worldwide. It's also forecasted that by 2050, the world will need to feed an additional 2 billion people.13
Putting aside the daunting implications associated with the population surge, if we only consider the effects of rising income, rural migration, and global climate change, it becomes very clear that small farmers will need all the help that they can get.
EWS relies on a distribution network to resell its seeds to sub distributors who then pass the seeds on to an estimated eighteen million farmers worldwide, but how does EWS support eighteen million farmers when they only have about four thousand employees?14 Like many global brands operating in developing and emerging markets, EWS finds it difficult to gain visibility on such a large number of end-users (small farmers). So, the brand needed to find a way to communicate directly to small farmers in order to provide meaningful content and listen to their needs.
With mobile phone and data prices continuing to fall in developing markets, roughly 37 percent of the population now owns smartphones in nondeveloped markets.15 The number is even higher in Southeast Asia, with mobile Internet users making up nearly 50 percent of the total population.16 As a result, the prevalence of using phones for online activities once reserved for laptops and desktops is rising. In Africa, researchers are now predicting that mobile Internet usage will increase twenty-fold over the next five years. That's double the rate of growth we are seeing in the rest of the world.17
Seeing an opportunity to leverage the growth in smartphone usage, EWS created a “Knowledge Transfer” and “CropWiki” app for small farmers. Using these apps, the farmer can upload crop information, photos, and notes. Then, based on that information, EWS helps to provide digital training to farmers on good agronomic practices to help increase yields (see Figure 7.3).18
According to a Rithea Heng of EWS, the brand must engage “in knowledge transfer because having good quality seeds is not enough to make vegetable farming profitable. Good agronomic practices are essential to maximize the genetic potential of the varieties we introduce.”
Figure 7.3. East-West Seed Crop Wiki mobile app. Photo credit: Amy Hsu
McCain Foods, headquartered in Canada, is primarily a B2B food brand, operating in 160 countries worldwide. Like East-West Seed, McCain is using IoE technology to help improve the lives of small farmers in India.
McCain supplies French fries to McDonald's in India. According to McCain, it manufactures one out of every three French fries eaten around the world, with annual global sales exceeding $6 billion USD.19
India has the world's largest youth population with 356 million people between the ages of ten and twenty-four, making it a very important market for McDonald's.20 Prior to McCain entering India, McDonald's was forced to use expensive foreign-produced fries to meet its strict global quality standards. In an effort to improve the quality of locally manufactured French fries, McCain began working with Indian farmers on potato crop quality through better seed selection, sowing, irrigation, and harvesting techniques (see Figure 7.4).
Figure 7.4. Typical small farmer potato cultivation in India. Photo credit: Tuktuki | Dreamstime
These changes helped farmers not only increase their yield, but also resulted in a higher quality potato that required less water for irrigation. Because McCain purchases their potatoes directly from small farmers, it was able to eliminate the middlemen or “mandi,” resulting in more demand certainty and better margins for the farmers.21
In India, McDonald's is positioned as a value offering, and routinely asks suppliers like McCain to reduce ingredient costs to help it remain competitive. Meeting McDonald's cost-reduction demands required McCain to achieve a step-change in efficiency. There are many factors that need to be monitored by small farmers that ultimately affect crop yield, such as the type of seeds used, planting techniques, air temperature, humidity, irrigation, fertilizers, and pesticides.22
The typical small farmer in India records farming data manually, which can lead to inconsistent record keeping and lower crop yields due to bad decisions made from using bad data. McCain partnered with Cropin, an Indian digital farm management provider, to geo-tag plots and install digital sensors that can detect dew point, rainfall, frost, and other challenges associated with farming potatoes.
By leveraging IoE technology, McCain gained more visibility of field activities and the ability to monitor crop conditions through an interactive dashboard. All of this results in better decision-making and an increase in potato farming yields.23
Radio Frequency Identification (RFID) systems have long been used by companies like Zara to help manage global inventories and increase supply chain efficiencies. RFID technology uses radio waves to identify tagged objects. RFID tags contain an integrated circuit and built-in antenna that can transmit data to a reader at distances of up to 30 feet without physical contact or line of sight (see Figure 7.5).24
Figure 7.5. An example of an RFID tag. Photo credit: Audrius Merfeldas, Shutterstock
7-Eleven is the largest convenience store chain in the world with a network of more than sixty-four thousand stores. In Japan, a country with an estimated fifty-five thousand convenience stores, there are nearly twenty thousand 7-Eleven stores in operation.25
Each 7-Eleven store requires roughly twenty part-time workers.26 Unfortunately, c-store chains in Japan are finding it increasingly difficult to hire enough employees because of a dwindling labor force stemming from an aging and shrinking population.
C-store workers need to be good at multitasking. In addition to ringing up merchandise, they also keep track of what's in inventory, place products on shelves, and help keep the stores clean. The large amount of work combined with a shortage of employees inevitably leads to situations in which service quality becomes sacrificed. To help remedy this, 7-Eleven Japan aims to automate all convenience stores by 2025 with a new RFID technology.27
Integrating RFID technology will allow 7-Eleven consumers to check out an entire basket of items at one time instead of scanning each item separately.28 The hope is that this new process will not only decrease the amount of labor required, but also speed up customer transactions (see Figures 7.6 and 7.7).
Figure 7.6. How the newest RFID self-checkout machines work. Photo credit: John 062
Figure 7.7. An example of a new RFID automated checkout system that is being tested in Japan. Source: Panasonic, used with permission
When Tesco, a leading global retailer with more than six thousand shops around the world entered South Korea, the company created a new brand for the local market named Homeplus. The new brand eventually grew to become the country's second largest retailer behind E-Mart.29
With fewer stores than E-Mart, Homeplus needed to find a way to step-change its penetration and close the gap. The company believed the answer might be in the high usage of smartphones within the South Korean population. According to the Pew Research Center, 88 percent of adults living in South Korea own a smartphone. That's the highest smartphone ownership rate anywhere in the world.30
Homeplus responded by creating a “virtual” store campaign in subway stations using printed billboards that displayed ranges of products and corresponding QR codes. These printed displays were made to look just like product shelves found in “real” Homeplus stores (see Figure 7.8). Consumers scan a QR code with their mobile phone and the product gets automatically added to their shopping cart and delivered right to their front door later in the day.
Figure 7.8. South Koreans “virtually shopping” in a subway station. Photo credit: Jackmalipan | Dreamstime
Homeplus was able to break through the competitive clutter and encourage consumers to stop and re-evaluate the brand. The brand demonstrated to South Korean consumers how online shopping could be more convenient than visiting a real store. As a result, the virtual stores received more than nine hundred thousand app downloads in less than a year, driving substantial online sales growth. Because of these virtual stores, the number of new registered Home-plus app members rose by 76 percent and online sales increased 130 percent. Homeplus has now become South Korea's number-one online retailer.31
Ofo is the brand behind those canary-yellow bicycles you find on streets all over China (see Figure 7.9). Launched in 2015, Ofo at one point operated more than ten million share-bikes in China and another one hundred thousand bikes in more than nineteen countries around the world.32
Share-bike systems are not a new idea. Over a decade ago in Europe, brands like Vélo'v, Vélib, and Bicing were pioneers in creating large-scale share-bike systems. However, brands like Ofo, Mobike, and Hellobike in China created a step-change in usage by leveraging IoE technology to create dockless bike-sharing systems. The problem with the original bike-sharing systems was that they were inconvenient. Bikes had to be retrieved and returned to specific docking stations, often requiring users to walk long distances to reach their final destinations.
With the new systems, riders just need to download an app that helps them locate a bike nearby and then use the app to unlock the bike and begin their journey. When they arrive at their final destination, they can park the bike in any spot that is legal and lock it using an app.
Because the underlying technology has become more accessible, brands in this space need to remain agile. Competing for market share, some brands are finding success by combining several services under one app. For example, Didi, China's equivalent of Uber, recently purchased Bluegogo, a bike-sharing platform, to provide additional convenience and increase barriers to entry. According to Tu Le, founder of consulting firm Sino Auto Insights, people want to use one app to hail everything: scooters, bikes, and cars: “That's where the sweet spot's going to be.”33
Figure 7.9. Ofo bikes parked in front of a subway entrance in Fuzhou, China. Photo credit: StreetVJ/Shutterstock
Customer Relationship Management (CRM) is a term used in business to describe IT platforms that store customer data and interactions, so companies can more effectively manage customer relationships.
Although CRM platforms have been around since the 1990s, their ability to disrupt has recently reached an inflection point with the integration of mobile devices, e-commerce, social communities, and email marketing. The following 4S framework was developed to help illustrate to my teams the potential of integrated CRM platforms (see Figure 7.10).
In emerging markets, distribution can be highly fragmented at the wholesale and street level. Sales teams must often manage extremely large geographic areas and portfolios of accounts, which results in limited mental bandwidth to support large numbers of customers. With an integrated CRM system, sales teams can gain important visibility of purchases and activities even at the street level. A good system enables salespeople to respond promptly to requests made by customers. However, what is really exciting about today's CRM platforms is the ability to integrate emerging digital technologies to drive demand. Now, let's examine each leg of the 4S framework.
Figure 7.10. 4S CRM/E-commerce framework.
SEE the End-User
SPEAK to the End-User
SELL to End-Users
SERVICE End-Users
Figure 7.11. The Buyer Decision Cycle.
Coca-Cola Germany created an integrated CRM system that is disrupting the beverage industry in Germany by providing fully connected CRM applications to its distributors, retailers, and customers. The system increases the effectiveness of Coca-Cola's stakeholders by giving them access to data, devices, and customer interactions in real time.
Coca-Cola created an integrated mobile app that helps sales reps plan, prepare, and execute meetings with customers more quickly and with more accuracy (see Figure 7.12).
The mobile app also has a virtual reality (VR) function that leverages customer data to show retailers exactly how Coca-Cola products will look merchandised in their stores.
Figure 7.12. Strategy Deployment Smart CRM—360°. Source: Genetsis Partners, used with permission
Coca-Cola Germany has experienced the following results from using integrated CRM technology:
When asked about its CRM platform, Coca-Cola Germany's CEO Ulrik Nehammer said, “It's a very important time in history to have a great brand coupled with great technology. We are on to something very, very special. Some would call it a secret formula.”35
Domino's Pizza Enterprises, the largest pizza chain in Australia, decided to leverage emerging digital technology to step-change the brand's growth trajectory. It started by focusing on online ordering, which makes up more than half of the company's sales.
Domino's looked to leverage the growth in smartphone usage to appeal to a younger generation of consumers who are connected to their smart-phones and social media—and who demanded exceptionally fast service, online and off.36 Don Meij, the CEO of Domino's Pizza Enterprises said, “From a Domino's perspective, the great thing about mobile is that it puts a pizza store in everybody's pocket. So you can order a Domino's pizza anywhere, anytime, anyplace on any kind of mobile smartphone device.”37
Domino's began by developing mobile applications for smartphones and tablets. In 2014, the company added a voice-ordering assistant to the mobile ordering app that guides consumers through the ordering process using natural-language technology.38 In 2015, Domino's followed up by adding GPS tracking so consumers could track their driver from the store to their door, launched a two-tap ordering option for smart watches, and launched text messaging and Twitter ordering platforms (see Figure 7.13).39
Figure 7.13. Domino's large portfolio of digital ordering platforms. Source: DPE, used with permission
Domino's claims that its focus on disruptive technology in Australia and New Zealand helped drive 17 percent growth in both revenue and same store sales.40
Thanks to continuous advancements in mobile computing power, augmented reality (AR) is finally reaching an inflection point. Apple's new AR technology, ARKit, is a perfect example of the progress being made.
Apple has embedded sensors and software into its new iPhones and operating system that allows developers to create apps that utilize those AR capabilities. The ARKit hardware and software can map and make sense of what the iPhone detects around the user in the real world and then lays virtual objects on top of it.41
Unlike virtual reality (VR), AR only requires a newer AR ready smart-phone making it very easy for consumers to adopt the technology. Tim Cook, Apple's CEO, made a bold prediction regarding VR's role in business when doing an interview with Vogue magazine: “Last month, IKEA and Anthropologie released new versions on their apps that allow customers to see how a new chair or lamp might look in their living rooms—and in the latter's case, even sample different fabrics and colors. Over time, I think [these features] will be as key as having a website.”42
To piggyback on what Cook said, it is clear that AR will become extremely meaningful to consumers living in developing and emerging markets where product distribution is often fragmented and lacking depth. In these situations, AR can enable consumers to virtually try things before buying them, effectively lowering many barriers to trial. Consumers will benefit from this technology when evaluating a wide range of products and services, such as trying on new clothing or a pair of eyeglasses, experimenting with different kinds of makeup, or buying new furniture for their homes.
Converse was one of the first brands to use AR technology to make it easier to buy shoes online. The Sampler iPhone app by Converse was very simple to use. To imagine what you would look like wearing a new pair of Converse, you select a pair of shoes on the app and then point your phone at your leg. Instantaneously, you could see what it would look like to wear the shoe you selected (see Figure 7.14).43
Figure 7.14. The Sampler iPhone app by Converse. Source: WeAR Studio, used with permission
Topology Eyewear uses advanced AR technology that takes a 3-D scan of a face with an iPhone app and then lets the potential buyer virtually try on different frames without stepping into a store. Each eyeglass frame from Topology is bespoke, matching the precise measurements of a user's face (see Figure 7.15).
Figure 7.15. Three-dimensional facial scanning to custom fit eyewear. Source: Topology Eyewear, used with permission
Consumers are able to customize the color, lenses, and materials to meet specific tastes and needs. Before an order is finalized, users can share their creation via text or social media with friends to solicit feedback, reducing the anxiety associated with buying a new pair of glasses and saving a lot of time.44
Sephora is owned by the French luxury conglomerate LVMH and has more than 2,300 stores in thirty-three countries around the world.45 Sephora uses AR to keep consumers in its stores longer. Sephora knows that the longer consumers stay in the store, the more money they will spend. So, the brand step-changed the shopping experience compared to what is typically offered at department store beauty counters.
Sephora strives to create a playground for Millennial women by allowing visitors to stay as long as they want—there is no hard sell. The brand uses AR and RFID technology to empower guests to pick up items and “tap and try” using Sephora's Visual Artist software located throughout the store. In addition, guests have access to Sephora's Skincare IQ diagnostic software that determines the best products for their skin.46
International consumers especially love the technology and “play” format because less information gets lost in translation and the consumer owns the experience. Calvin McDonald, president and CEO of Sephora Americas, said, “When a client comes in and experiences Teach, Inspire, Play, she's going to experience it on her own, she's going to experience it through cast members, and she's going to experience it through technology” (see Figures 7.16. and 7.17).47
Figure 7.16. Photo of Sephora Virtual Artist interface. Photo credit: Amy Hsu
Figure 7.17. “Sephora Bar” play area in Shanghai, China. Photo credit: Amy Hsu
Taking a trip to IKEA to buy furniture can require a big time investment. Not only does it take time to travel to an IKEA store that is usually located on the outskirts of a city, but it also takes a lot of energy to navigate your way through the huge and often crowded store to find exactly what you want. Then, regardless of how much planning you did, you still have to take a leap of faith and hope that the furniture you selected will actually fit in your home the way you imagined.
Figure 7.18. The IKEA augmented reality app. Photo credit: Amy Hsu
Johannes Ferber, a managing director for IKEA, says, “There are many city dwellers who don't have a car or aren't willing to drive outside the city to do their shopping.”48 IKEA's own research has shown that almost “14 percent of its customers end up taking home furniture which turns out to be the wrong size for its intended location.”49 To make matters worse, IKEA faces the barrier of heavily congested roadways and a lack of infrastructure in many developing markets like India, where there is also strong resistance to carrying heavy, flat-packed furniture back home to assemble on your own.
So IKEA is now using the latest AR technology to help lower purchase barriers. IKEA's new catalogue app has more than two thousand products that can be virtually placed into scanned photos of any room using AR.
Consumers no longer have to take a long journey to a store just to measure dimensions, compare colors, and buy pieces of furniture on faith before seeing what it looks like in their homes. Now users can see the furniture, place an order, and schedule delivery and assembly all with one iPhone or iPad application (see Figure 7.18).
Aaron Luber, head of VR Partnerships at Google, said, “Film used to be the most immersive storytelling medium. But even with the best, highest-resolution TVs, you're still just watching. You're not there. The promise of VR is what the industry calls ‘presence’—the feeling that you're really somewhere else.”50
Virtual reality (VR) technology creates a three-dimensional computer simulation where users can explore a virtual environment as if they were really there. The technology has advanced to the point where it has become feasible for use in mainstream applications.
In the same way that AR can help consumers in new markets “try” things before buying, VR can help consumers in new markets “experience” brands in a way that would have been very difficult or nearly impossible in the past.
Patrón, the leading ultra-premium tequila brand in the world, now offers users a virtual tour of its hacienda in Mexico where the famous blue agave is distilled. All you need is a tablet, laptop, or Google Cardboard, and you can experience the handcrafted process that goes into making Patrón tequila and explore the hacienda's vast agave fields and surrounding landscape (see Figure 7.19).51
Figure 7.19. Patrón's virtual hacienda tour. Photo credit: Amy Hsu
Google Cardboard is an affordable and easy-to-use VR headset that you assemble yourself by combining it with a smartphone to deliver an impressive immersive experience (see Figure 7.20).
Now users even in remote areas of emerging and developing markets can experience things virtually that they would have never been able to experience before. For example, Google has created virtual expeditions for Cardboard that allows students, no matter where they live, to visit places like the Great Wall of China, Machu Picchu, and the Great Barrier Reef.
Figure 7.20. Cardboard virtual reality glasses. Copyright: lord_photon/Bigstock
I recently learned how students in Africa are now able to attend universities by using their smart mobile phones. VR technology seems like a natural next step in the evolution of mobile education.
Eon Reality is an American software brand that has created a VR platform that specializes in providing education and business solutions. Eon Reality believes that knowledge is a universal right and should be available, accessible, and affordable for every person on the planet.52 For example, Eon is partnering with the city of Tshwane in South Africa to help instruct local students on how to create and use VR content to teach vocational skills, math, and science in local colleges.53
Most language-learning experts agree that the most effective way to learn a language is through immersion. The problem is that language immersion programs are typically very expensive. For example, even the least expensive immersion option in South America will run you about $1,000 per month, effectively shutting out most emerging market students.
Romania-based ATi Studios is the owner of Mondly, the leading virtual reality language app that teaches more than thirty languages on Google's VR platforms Daydream and Cardboard. Like a real in-country immersion, Mondly recreates real-life situations and actual conversations in VR, offering instant feedback on pronunciation (see Figure 7.21). So far, there have been more than twenty million downloads in 190 countries.54
Figure 7.21. Mondly VR language app. Source: Mondly, with permission
From intelligent personal assistants like Apple's Siri to Google self-driving cars, we see the signs of artificial intelligence (AI) and machine learning almost everywhere we look. Experts agree that AI will have a significant impact on developing and emerging markets. The two areas that seem to have the most promise at the moment are healthcare and farming.
Zipline is a California-based robotics company that delivers blood and medical supplies to remote areas of Rwanda and Tanzania via autonomous drones.
In rural Africa, about two billion people lack adequate access to essential medical care due to challenging terrain and roads, according to the World Health Organization.55 In Africa, 95 percent of roads wash out every year.56 By riding on mobile technology, Zipline has created a step-change in the value that medical couriers provide in Africa.
To place an order with Zipline, a medical staffer needs only to send a text message. Upon receipt of the message, Zipline loads and launches a drone from one of its distribution centers. An autonomous drone then flies at speeds of up to 60 miles per hour, arriving at its destination within thirty minutes.57
Access to diagnostic medical imaging in developing and emerging markets is often in short supply. Ultrasound machines are extremely helpful in obstetrics, cardiology, and cancer detection, but a traditional machine is difficult to transport and tends to be very expensive (the average machine costs more than $100,000), and requires a trained physician to read the images (see Figure 7.22).
Butterfly iQ, a US-based medical device brand, sells a handheld imaging unit that plugs directly into an iPhone and starts at less than $2,000.
What really differentiates Butterfly iQ from competitors and provides an opportunity for the company to step-change the value it offers is its AI component? Butterfly iQ updates the software using vast datasets of ultrasound images so the app can discern between good- and bad-quality images for various body parts. The iPhone display can even guide the user to scan the best spot for capturing a good image, and the software can also conduct a simple read of the scans to help determine what steps should be taken next.58
Figure 7.22. Traditional ultrasound machine. Photo credit: uatp12/Depositphotos
The Tata group is made up of more than one hundred operating companies spread across six continents. More than 24 percent of all Internet routes travel over Tata's global communication network. Tata has invested $1.19 billion in its global fiber network, which can stretch around the world seventeen times.59
Vinod Kumar, MD, and CEO of Tata Communications, has spoken about the company's belief in “the transformative force that massively distributed computing and artificial intelligence can play in helping businesses get insights and solve their most complex big data problems.”60
India is an agrarian economy with more than 58 percent of rural households depending on farming as their primary source of livelihood.61 As we touched on earlier in this chapter, farmers in developing markets need to dramatically increase their efficiency just to meet the expected growth in demand from urban migration.
Rallis, a Tata subsidiary and one of India's leading crop care companies, is using AI to help improve the yields of Indian farmers. Rallis's AI technology takes massive quantities of data on crop health and soil conditions and distills it down to information that directs pesticide-administering drones that improve the yield of crops.62 In addition, the drones reduce the negative health side effects that come from spaying pesticides manually.
Microsoft India has developed an AI sowing app that has led to 30 percent higher yields. Dr. Sushas Wani, the Asia Director of the International Crop Research Institute for the Semi-Arid Tropics (ICRISAT), collaborated with Microsoft on the app and said, “Sowing date as such is very critical to ensure that farmers harvest a good crop. And if it fails, it results in loss, as a lot of costs are incurred for seeds, as well as the fertilizer applications.”63
To help farmers, Microsoft's AI technology analyzes historic climate data spanning the last thirty years, and real-time rainfall and soil moisture readings and forecasts. The app then sends advisories containing essential information regarding the optimal sowing date and depth, fertilizer applications, seed treatments, and more.64
This is an additive manufacturing process that creates 3-D objects guided by a computer-generated design. The 3-D printer lays down successive layers of building material that join together until an object is formed.
As more building materials are being developed to work with 3-D printers and the cost of the technology becomes more affordable, the popularity of 3-D printing is increasing. Gartner, a leading global research and advisory company, estimates that soon, nearly 50 percent of all consumer, heavy industry, and life sciences manufacturers will be using 3-D printing to produce some parts for items they consume, sell, or service.65
The solutions that 3-D printing provides for developed markets (e.g., tools for lean design, rapid prototyping, and bypassing a need for critical mass) become transformational in developing markets. Developing market experts agree that there is tremendous potential for 3-D printing to create disruption, especially in the areas of housing and artificial limbs.
As in many parts of the developing world, in China there is huge demand for affordable and safe housing as a growing number of rural workers relocate to cities.
Shanghai-based Winsun is a pioneer in 3-D printing technology. The company invented the first continuous 3-D printer for construction. Winsun's unique printers measure 10 meters by 6.6 meters and use a special mix of concrete, sand, and fiberglass to print walls and other components used for building housing structures in a factory. Then, workers assemble the structures using the prefabricated panels on-site.
Winsun claims that with this technology “they can save 60 percent of the materials typically needed to construct a home of the same size, build it 70 percent faster, and with 80 percent less labor. This minimizes the environmental footprint, as well as speeds up the process, greatly reducing the chance of on-site injury.”66
In 2013, Winsun made headlines when it built its first batch of detached single-story houses. The company constructed ten houses in less than twenty-four hours at a cost of $5,000 each (see Figure 7.23).67
Recently, Winsun signed an agreement to collaborate with Aecom, an American engineering firm, to help build 1.5 million affordable homes in Saudi Arabia. Yihe Ma, the chairman of WinSun, said, “This collaboration will enable us to further accelerate the development of our construction 3-D printing technology and help drive the integration of construction 3-D printing technology with planning and design.”68
Figure 7.23. The inside of a 3-D printed home. Photo credit: Matjazz/Shutterstock
The World Health Organization (WHO) estimates that about thirty million people require prosthetic limbs, braces, or other mobility devices. Unfortunately, fewer than two out of ten people who need mobility devices have them.69 Nia Technologies, a Canadian nonprofit social enterprise, has developed a technology platform called PrintAbility, which is described as a digital toolchain that combines 3-D scanning, modeling, and printing with custom software and affordable hardware to produce prosthetic devices.70
Nia is working with Google to build an open source digital platform for orthopedic technologists—a digital “toolkit” that mirrors the manual prosthetic development process in a digital environment. Instead of creating a cast with plaster, the residual limb is scanned to create a digital model (see Figure 7.24).
Then, a 3-D model is customized to fit the patient, and a prosthetic limb can be printed in about six hours.
This digitally assisted process results in faster production times, increased access to care, better fitting devices, and shorter hospital stays, all at a cost savings to the patient.
Figure 7.24. A prosthetic socket being oriented with PrintAbility technology. Photo credit: Nia Technologies
By leveraging 3-D printing, PrintAbility has enabled orthopedic clinicians in developing countries such as Uganda, Cambodia, and Tanzania to step-change their productivity by 333 percent and improve the lives of many young patients in those countries.71
