Developments in AI, automation, augmented reality and robotics have spurred on changes that merely a few years ago would have been unimaginable. From self-driving cars to drones and even predictive analytics developments in genetic research, every sector seems to be going through significant changes.
The Pew Research Centre highlights that nearly half of US adults use a voice assistant to interact with their smartphones and devices. Indeed investors are increasingly attuned to these changes with PE houses such as Apax Partners, CVC and KKR collectively investing over $3bn in technology-focused funds.
While developments in technology have already catalysed fundamental changes in the way we live our lives, further seismic shifts are still expected. Much like the dot.com boom, it is likely that the next few years will be characterised by excessive speculation as consumer usage and adoption of this technology increases.
This begs the question: can data reliably indicate market demand and consumer sentiment towards “deep tech” products? Ascertaining market demand can prevent speculative investments and increase the likelihood of generating substantial ROI.
An analysis of the US and UK Markets and the consumer demand for deep tech products paint a very interesting picture for investors.
UK Market Demand for VR, Drones, Self-Driving Cars, Smart Home Technology
Consumer search demand data in the UK market indicates that searches related to these products have declined by 35% YOY. There was a notable surge in demand in December 2016 when Amazon conducted the first successful drone delivery, cleverly done at a period when sales are already boosted by Christmas. While it is evident that this had some implications on yearly trend, an analysis that accounts for this data still illustrated an annual decline of 10%
US Market Demand for VR, Drones, Self-Driving Cars, Smart Home Technology
Much like the UK market, consumer search demand for such products has also declined by 33% YOY in the US. An analysis of this data that accounts for the Amazon surge indicates that search demand has also declined by 9%.
Relative to the noise that has surrounded these products, the data presents a very different picture.
An assessment of public sentiment towards self-driving cars, for instance, also illustrates that consumers are less receptive to these products than it might otherwise seem. Net sentiment related to self-driving cars is currently at -8% negative, with a sharp drop of -21% in March following the death of a pedestrian caused by Uber’s self-driving car.
With consumers highlighting the risks associated with this technology as a significant bottleneck to adoption, investors and executives will need to carefully consider appropriate responses to these insights.
In order to survive this vastly shifting climate, investors will need to adapt not only to technological developments, but also to the market demand and sentiment around these products. In the dot.com boom, investors put their money behind companies that never realised any material revenue. It is, therefore, of paramount importance to understand the market using digital analytics. This data can ultimately inform investment decisions, operational improvements and modify market strategies.
The future is being designed, and those that want to bring deep–tech into the fold need to carefully consider how they can leverage digital analytics to better understand market growth, consumer demand and strategic navigation.
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To understand how onefourzero’s data-driven insights can help you navigate this exciting investment environment, please click here or contact our MD Fleur Hicks: fleur@onefourzerogroup.com
