Supersized options can slow tech adoption
For years I have been pushing the concept of using innovation to become and remain a market leader. Innovating products can help companies push through difficult financial straits by making their products viable in weak economies. However, this summer I saw how innovation could perhaps impede the market’s ability to adopt new products. America’s craze for new and innovative products might be hindering our access to some of the better solutions.
While vacationing in Australia for two weeks this summer, I made a couple of observations that led me to reflect on our use of technology in the United States. I made the first observation when paying the taxi fare for the ride from the airport to the hotel. I used my new chip-enabled credit card as I normally would, but instead of taking my card and running it through a swipe card reader, the driver had me personally insert the card into a chip reader without the card leaving my hand. This happened repeatedly at every opportunity I had to use my credit card. Every business I frequented was enabled with chip readers – both mobile and at point-of-sale terminals.
I made the second observation while touring along the Great Ocean Road. At the end of the day, the tour guide stopped for dinner in a small town along the route that offered several fast food options. I chose to go to McDonald’s (called Macca’s in Australia). After entering the restaurant, I was surprised to see several touch screen ordering kiosks set up where you could review the menu, pick from the standard items, or customize your own meal (see example kiosk in Figure 1). I could select my bun, make it cheesy, turn up the taste, freshen it up, and get it saucy! The kiosks presented detailed photos and an itemized list of your selections before confirming your order, which you could pay for with your chip-enabled credit card. Your order number was displayed above the counter when your order was ready.
I was duly impressed by the fact that both of these technology advances were widely used in Australia. In contrast, I have only used my chip-enabled credit card once in the United States, at a Walmart, where it was a bit unreliable and required me to run the card a couple of times before the transaction completed. I had never seen kiosks in any restaurant in the United States like those I saw in Macca’s.
These observations caused me to think about why these types of devices are not common in the United States, the epicenter of the Internet of Things. It struck me that perhaps one of the reasons we are slow to adopt a lot of innovative solutions is because we have too many options. Our economy is not particularly good at filtering options and going with a solution that can be rolled out across the country. Chip-enabled credit cards and readers are not new; they have been around for decades, yet we are probably the last major economy to begin using this more efficient solution. Even now, with the pervasive problems of identity theft and stolen credit card information, we are slow to complete the changeover that is critical to making our financial transactions much more secure.
The Australian Outback was the last place I would have expected to see my first McDonald’s kiosk. I would have guessed my first such experience would be in Silicon Valley.
We do see exceptions to this. Apple’s iPod is a classic example of innovation that quickly squeezed out the competition, leaving us with a fairly universal and compatible solution.
I propose that the reason we are sometimes slow to adopt new technology is that we are offered too many choices – so many choices that it takes way too much time for one to bubble to the top. Competing kiosk companies push their own designs. Take for instance smart phone payment systems. Several have rolled out, yet few businesses use them because of the differences. Regions like Australia see a more limited number of choices and subsequently sort out the winners and losers faster, leading to widespread usage of solid solutions.
Don’t take this as a message to give up on innovation, but as a message that standards provide a way to help innovation gain market traction faster.