Throughout my career, one of the primary ways to classify a company has been its industry. Knowing a company’s industry gave you a solid start on understanding the company. From an analytics perspective, you could make highly accurate assumptions about what data an organization would have, what problems it was trying to solve, and what types of analytic processes would be beneficial for the organization’s business.
I have noticed a trend forming where these historical industry classifications and associated assumptions are becoming less and less accurate. I believe that this trend is tied in large part to the rise of analytics and big data over the past few years.
Consider the Nike+ product line and specifically the Nike+ FuelBand. While the FuelBand is being sold and marketed by what many perceive to be a “clothing company”, it really isn’t clothing at all. It is an electronics product. Yes, Nike is in the high tech manufacturing business. The product also has associated web and smartphone applications. Nike is also in the software business. But wait, there’s more! The primary purpose of the device is to capture data on your daily activity such as how many steps you take and if you meet your daily activity goals. That data gets uploaded and stored by Nike. Nike is in the data collection and storage business. How do users interact with their data? Through reports and charts within the associated applications. Nike is in the analytics as a service business. And some might argue they are in the health business as a result of their analytics.
By now you should get the point. Based on the above, it is clear that Nike is no longer purely in the clothing business. In fact, they are in several businesses that have nothing to do with clothing and that have completely different challenges. What led to Nike’s success in the past won’t apply directly in these new spaces. Whether or not you’ve realized this change, Nike certainly has. Nike has been steadily developing these new capabilities as it pushes to realize its vision, which is “To bring inspiration and innovation to every athlete in the world.”
What Industry Is Your Company Really In?
Are there areas of your business that are really more about capturing data and using it for analytics than the underlying product itself? If so, it is important to recognize that fact and to adapt your business accordingly. It would be a critical blunder to continue to focus on what your company used to be, or what customers still perceive it to be, rather than to focus on what will actually drive your products’ success in the future. That success may have little to do with the industry you’ve traditionally been a part of.
Nike FuelBands are selling like hotcakes and consumers don’t care that what they may still consider a “clothing company” is selling the product. What those same consumers may not have taken time to realize is that Nike isn’t just a clothing company anymore. Is your organization missing the chance to make a similar transition that challenges the notions of what industry you are in?
Originally published by the International Institute for Analytics