Creating products using data and insights
The algorithm economy has gained solid traction on many fronts. Some applications are related to infrastructure and back-office functions, while others are customer facing. Netflix was willing to spend $1 million for an algorithm to improve its video recommendation service for its customers. Other companies have been investing in algorithms not just to improve their current product and service offerings, but also to extend them in innovative ways. These firms have been infusing their core product offerings with data collection and analytics to enhance their performance. Consider the following customer-facing examples of the algorithm economy in action:
- Oral-B has designed a Bluetooth-connected “Smart Toothbrush.”8 The product works with a consumer’s smart phone to collect and analyze various data, enabling an algorithm to score that person’s “performance” on oral hygiene and give real-time...