There's Data in That Toothbrush (And Lots of Other Products, Too)
Imagine for a second that you could interview a product. How often is it being used? For how long? And where in the house does it live?
Sounds crazy, but it's increasingly probable as marketers mine for data beyond the usual places -- web browsers, loyalty programs and smartphones -- and capture information from pill packages, soda fountains and the most mundane of consumer implements, the toothbrush.
Take the $49.99 Beam Brush, launched in January. It syncs with a user's smartphone to record brushing time, and that data can be tracked and shared with dentists, orthodontists and, eventually, insurance companies, all on an opt-in basis.
"People often refer to us as a toothbrush company, but we're not. We're actually not interested in toothbrushes at all. We're interested in health data," said Alex Frommeyer, co-founder of Beam Technologies, based in Louisville, Ky. "In many ways, [data-tracking] is the entire point" of the Beam Brush.
Beam is conducting a pilot with an insurance firm and negotiating a deal to distribute the Beam Brushes to policyholders, who would agree to exchange usage data for incentives such as lower rates.
The Beam Brush is the latest twist in the development of data-producing products such as GPS watches, internet-synced bathroom scales, the Fitbit calorie-and-exercise tracking system and the Nike+ FuelBand, a bracelet that uses an accelerometer to gauge a person's activity throughout the day.
But beyond fitness and health care, the data mined from sensor-equipped products could hold huge advantages for marketers. The biggest opportunity could be in more "simple product" categories -- such as consumer packaged goods -- in which data-generating technology helps marketers test ideas and could eventually guide everything from product positioning to distribution.
In effect, data allows marketers to get feedback directly from products, said John T. Cain, VP of SapientNitro and co-founder of Sapient-owned Iota Partners, an agency that "instruments" products and environments to understand consumer behavior.
"If you could talk to the products, you might get a completely different perspective," he said, doing his best rendition of a 21st century Dr. Dolittle. "As the price of technology comes down, increasingly there will be and can be embedded sensing bits in products."
For now, instrumentation mostly comes in the form of attaching sensors to products, often for testing rather than for tracking sales and live consumer interactions. SapientNitro, for example, enhanced a household-cleaning product with cameras to capture how the cleaner was used in consumer's home.
"The client came to us and asked if we could do a customer journey and we said we can do one better—we can do a product journey," said Mr. Cain. "We can outfit real-world products with cameras and ... data loggers."
Tracking noted the days of the week the cleaning product was used and showed its "stuckness" -- meaning it was often left in a cabinet, garage or basement versus being used throughout the home, said Mr. Cain. "That provided a lens into where it's not going."
SapientNitro also worked with Mars-owned Wrigley and a grocery retailer to measure consumer interest in a poorly selling confectionary product. The system detected mobile-phone signals to track dwell times and consumer paths around the product. "It gets you thinking about new ways to pair the product with other allied categories ... maybe [in] the dental aisle," said Mr. Cain of the product, which he declined to name.
Ogilvy Innovations Worldwide, meanwhile, is working with 14 clients on projects that feature some sort of data-gathering element, according to Mark Seeger, the division's director. The agency is testing data-tracking technology in a CPG brand in Europe, though wouldn't share details on the client or category.
Coca-Cola has 12,000 consumer-data-collecting devices across Five Guys burger joints, cineplexes and college campuses. They're better known as Freestyle machines: digital fountains that let consumers choose from 125 flavors and drinks and then feed data on those choices back to Coke.
There's a lot the global beverage giant could learn from Freestyle usage patterns, such as flavor combinations that could inform products or marketing and regional preferences.
Susan Stribling, Coca-Cola's director-public affairs and communications, said the company is starting to look at how it might use the data.
"We're able to attain a significant amount of ... data which allows us opportunities to leverage new-product ideas," said Ms. Stribling. "But our current focus is on using that data for supply-chain benefits." Coke sometimes provides reports on consumption, inventory and forecasting to help outlets budget and gauge top-selling products.
"We do have the ability to leverage data for new-product ideas and other future innovations—and we plan to become more active in this space -- but we're just starting to scratch the surface," she said.
As the potential for data-generating products rises, it raises questions, most notably: Whose data is it, anyway?
"That's the prime thing in contention here," said SapientNitro's Mr. Cain.
Marketers need to tread carefully to strike the right contract with consumers. At Beam Brush, the user owns the data collected by the toothbrush, according to Mr. Frommeyer. He added that Beam needs to access the data through its brushes "for security and maintenance."
"From there we are presenting the opportunity for certain customers to sell their data in the form of getting insurance [discounts], for example. ... The consumer is at the center of the model."
Health-tracking armband maker Body Media, recently acquired by Jawbone -- another activity-tracking bracelet seller -- does not sell its data but stores it and uses it to refine algorithms, according to Gwen Smith, director of marketing.
Assuming consumers see benefits from data-tracking products, the possibilities for gathering behavior data through everyday products are endless.
Car makers such as BMW can track anonymized location data and vehicle speeds to gain insight into how vehicles are used and how they may be improved. And GE has built data-collection abilities into the dishwashers, refrigerators and heaters in its smart-appliance line. Part of the value proposition is for the consumer: Appliances connected to a smart grid allow homeowners to better regulate their own energy consumption and costs.
"Even saltines boxes and rubbish will someday have a kind of embedded sensing technology," said Mr. Cain. "But the equation has to be cracked for consumers to accept this technology in their lives. There has to be some sort of reciprocity ... some sort of intrinsic value."