The products of the future are not digital or physical - they are both. So why can't companies make them?

Most companies can create great digital products. Some companies can create great physical products. But hardly any companies create products that are both. Why is that?

If they say that all roads lead to Rome, then all of the Internet leads to OSI. The OSI model shows the Internet as a stack of layers, and it was a staple of my CompSci degree. I'm not old enough to have forgotten it yet; whether that is good or bad is an exercise for the reader.

The OSI model

In the OSI model, the top most layer is the "application layer", where we have a bounty of billion dollar companies, like Google and Facebook. They're abstracted from the lower layers, which means they when write code or publish blog posts, they don't have to care about how the bits and bytes travel around the world on the "transport layer" or the "network layer".

How the Internet's application layer created billion dollar companies

Google and Facebook became billion dollar companies because they're scalable. The application layer is light and flexible, whereas owning something physical is expensive and only scales linearly, limiting opportunity. Thanks to agile principles, we can make great digital products in minutes over weeks, at no cost, and with no code. Most companies can create great digital products because of how the application layer scales and abstracts.

But creating great physical products is a different story. What happens when a billion dollar application layer company makes a physical product? Well, they look to the Internet of Things. And to be fair, IoT has come on leaps and bounds in the last decade. We can fit the whole OSI stack into a board the size of a couple of fingers (just look to the Amazon Dash button as my favourite example). IoT hardware will, however, always be big and expensive. This is simply a physical limitation - there is only an amount of minifying we can do before WiFi becomes impossible to implement, not to forget the space for a battery, no matter how small. Aside from the typically terrible digital side of IoT products (and never mind their security), some companies still create products that have had great impact, like Philips Hue, or my WiFi toothbrush (alright, that's a joke). But physical products with the whole OSI stack will always be big and expensive, and therefore difficult to scale.

So what does a product that is both digital and physical look like? And why can hardly any companies make them?

The language barrier

One problem is language. The word product implies something singular. We talk about companies having multiple single products, usually "apps" in the "application layer", of course.

Sure, we can think of smartphones as products with both software and hardware, but apart from devices with a screen and a browser and a WiFi chip, can you name anything else? The word "product" just doesn't work for something that is digital and physical, because something like that is more abstract. At Sticky, we like to use the word "experience" over product to help companies understand building products in both the digital and physical space. We like to use that word mostly because these products are seriously transformational, and thinking bigger than a product puts companies in the right state of mind for the future.

Will it blend? Yes. But will it scale?

Another problem is scale. If we have solved the scalability of the application layer but the physical layer is inherently difficult to scale, can companies even create these "experiences"?

Yes.

And we make it possible.

About Sticky

We remove the cost of IoT hardware by using the IoT hardware in all of our pockets - our smartphones and smart watches. We use their contactless technology to allow companies to create a new kind of product that is both digital and physical. And by contactless technology, of course, we mean NFC.

Connecting apps and workflows with things and people boosts consumer loyalty, convenience and interaction, and we're hyped to be at the forefront of experiences over products and the interaction paradigms of the future.