Magnetic Thought Report: Tech and Touch

The world we’re shaping tomorrow through the trends emerging today. Continuing our series on the big topics on leaders’ minds, next in our series of articles we are chatting about new digital enhancements to our physical world. If you missed our series, catch up with Trend #1 Green by Design, and Trend #2 New Digital Worlds.

With our online and offline worlds increasingly overlapping, a multitude of physical experiences are now enhanced with digital tools that make them faster and easier. Technology, with its sleek devices and interfaces, has redefined how we interact with the world around us. Tap, click, swipe, scroll, touch in, touch out… These are our gateway to an astonishing global matrix of interactions, information and experiences.

We can expect more merging and harmony between tangible experiences and digital interfaces, in areas including transport, retail, home and cities.

Considering the history of shopping — right back to the marketplaces of the ancient world — the digital changes in stores have been revolutionary. Yet we’ve adapted to them, relatively speaking, in the blink of an eye. These have included QR codes, click and collect, in-store iPads where we can check sizes, availability and price, and secure contactless payment systems such as Apple Pay or Google Pay that wirelessly connect our device with the retailer’s terminal.

Only a few years ago, these would have been unimaginable, even far-fetched.

Three areas of opportunities

Retail
With the big shifts in consumer behaviour of the past few years, speeded up by the pandemic, customers have become more connected and informed, more online, and less loyal. Along with the general downward trend in retail sales, this makes tech modernisation key to driving growth.
This applies to both customer experience, such as omnichannel shopping (multiple integrated digital and physical touchpoints) and XR experiences, and retail operations, such as new business models, headless commerce and better capture and use of data.

• Omnichannel shopping. Often, ecommerce systems have been developed separately to a retailer’s legacy tech, so prices, promotions and inventory aren’t synced in real time across all touchpoints. It makes an omnichannel offering difficult. However, the API in a headless commerce system directs information from the commerce platform to all touchpoints and customers have a consistent experience across all channels, whatever application or
  device they’re using.
• Digital first but not digital only. Let’s not forget that while online shopping has grown, most shopping is still done in stores. In the UK, which has the most advanced ecommerce market in Europe, online shopping now accounts for 26.5% of retail sales. But it has decreased since the 2020–21 high, and that figure means 73.5% of shopping is still done in person. Perhaps surprisingly, according to a survey of 15,000 consumers, young people are the group that most want brands to offer both digital and physical.

Smart Home

Music, movies, coffee, doorbells, heating, lighting, fridges, robot vacuum cleaners… as the list of home automation devices increases, so does the number of us who have them. In 2018, 23% of homes in Britain had at least one smart device and in 2023, this has grown to three-quarters of us. Reasons include the wider shift to digitalisation and our desire to protect the environment by being more energy efficient. With nearly half of us expecting to buy more smart devices in the next few years, this creates opportunities. (Did you know the proper name for home automation is domotics?!)

• AI in home automation. This could bring more and faster improvements to energy efficiency and cost savings; personalisation, as devices learn our preferences as we use them; and predictive maintenance, avoiding breakdowns and expensive repairs.
• Independent living. The world’s population is ageing more rapidly than ever. In England and Wales there are now more over-65s than children under 15 — almost one in five of us. If smart devices can make homes safer and more comfortable for people who might otherwise need hospital or hospice care, it’s a triple win: improved wellbeing and independence for older people; reduced pressure on our struggling health and care system; and the wider benefits, to community, society and the economy.

Magnetic Example — Sky Protect: smart tech and home insurance in one. Following its purchase of insurer Neos, who we worked with on its launch in 2017, Sky was about to launch into the UK insurance market with a new product: smart tech and home insurance in one. But it wanted to stretch its proposition, to gain market volume and reach new audiences. We looked at opportunities to solve problems for typically overlooked and more vulnerable customer segments. We narrowed in on the elderly population and, through home visits and ethnographic interviews, uncovered their needs, pains and family dynamics. With these insights, we developed a prototype solution that we rapidly tested on real customers. We discovered which features of the smart home offering could be applied to look after older people at home, and expanded Sky’s proposition.

Smart Cities

A smart city uses digital technology to make it more liveable, sustainable and prosperous. It is about people and place as much as technology and data.

A successful smart city is human-centred, data- driven and technology-enabled, an ecosystem of solutions that benefit everyone and improve the quality of life. It addresses urban challenges and improves infrastructure and services, including transport, traffic management, waste management
and more. This requires collaboration and innovation from government, business, public sector and academia, with strategies that include environment, economy, people, living, mobility and governance.

Inspiring Example — London is one of the smartest cities in the world
and, with its digital infrastructure, smart city technologies (especially transport) and citizen data, one of the best-prepared for a smart future. London has more 5G towers, EV charging stations and green infrastructure than any European city.

• Smart mobility. Efficient, safe, resilient and sustainable city travel, including improved infrastructure, traffic management, mobility-as-a-service, micromobility, logistics solutions, autonomous vehicles and net-zero solutions. An analysis of 3,000+ smart city startups and scaleups identified mobility as 2024’s top smart city opportunity.
• The digital citizen. More than responsible online behaviour, this is an expanded meaning of the term, adding digital to the traditional idea of citizenship. It’s how we participate in society but seen through the use of technology and datafication, and with the focus on empowering and democratising. This includes collaborative community, citizen engagement, inclusive access to civic participation, work and education (e.g. remote and personalised learning) and AI-powered, data-driven healthcare ecosystems.

CEO’s POV

Tech and Touch. In our digitised world, touch has come to have an additional meaning: digital touch as well as human, sensory touch. Touch is no longer just the sensation of feeling objects or person-to-person touch. But these hard, electronic tech touchpoints of our daily lives are fast and often mindless, encouraging us to speed through life and get more done. So what can we do?

For me, it makes mindful moments and the simple, grounding, sensory pleasures of soft human touch even more important. The touch of a hand, a hug, a smooth new sheet of paper, the satisfaction of kneading dough, feeling warm water on our skin. There are some things tech can’t replicate (yet!).

This is an exert from our latest Thought Report, the full report can be downloaded here.

Author: Jenny Burns, Magnetic CEO

Jenny is always happy to talk about the issues teams and businesses are facing, and how we can unpack problems together to find and design for unmet needs. Coffee? Email jenny.burns@wearemagnetic.com.