It is important that technology application changes corporate mindset and corporate culture

"The era of viewing each individual technology separately just because it is called a technology trend has passed. Now the perspective of matching strategy and technology is important in finding a business model."

This year, technologies from various fields became issues, including IoT-based smart home technology, virtual reality (VR), augmented reality (AR), machine learning and deep learning, big data, physical-digital integration, blockchain and cryptocurrency. What technology will be suitable for business models going forward?

Kim Jin-young, CEO of ROA Invention Lab, predicted that "the technologies that came out this year will evolve and deepen next year," and "the areas that will become visible from a service perspective are IoT and smart home technology, automation technology based on machine learning and deep learning, and physical-digital integration will be fully launched."

The most notable among smart home technologies is the artificial intelligence (AI) speaker. Amazon's Echo, launched in November 2014, sold a cumulative 14.1 million units as of the second quarter of 2017. Google Home has also recorded 11 million cumulative units since its November 2016 launch. Of these, 4.7 million units were purchased by customers who bought both Echo and Home. In Korea as well, various products have been successively launched, including SK Telecom Nugu, KT Giga Genie, Naver Wave and Friends, and Kakao Mini.

Apple is also preparing for the launch of artificial intelligence speaker HomePod next year, and competition is expected to accelerate. HomePod has differentiated itself in high-performance speakers by utilizing seven Twitter speakers and one woofer speaker, with six microphones to receive sound from all directions equally. It is integrated with Siri and Apple Music and has home assistant functionality to control home devices by voice.

Kim said, "From a B2B perspective, AI speakers are a medium to transform organizations and business models, and from a B2C perspective, based on accumulated data, they can connect to e-commerce and create new services, making it difficult to predict how far they will evolve."

The application of omnichannel using machine learning and deep learning algorithms is an area where services will become visible. Stitchfix, a U.S. fashion e-commerce company, has no clothing photos on its shopping site. When accessing the site, customers check body measurements, style preferences, and lifestyle. Based on customer profiling data, artificial intelligence recommends clothing, and professional stylists select five of them for delivery. Customers pay only for clothes they like and return the rest. Artificial intelligence learns customer preferences and reasons for returns through their social accounts to apply to next recommendations. 80% of customers make repeat purchases within 90 days of their first purchase.

The application of artificial intelligence technology is expanding beyond fashion and clothing to cosmetics and accessories. The higher the information asymmetry and search costs, the greater the expansion potential.

As technology competition between physical and digital retailers intensifies, attention is focused on physical-digital integration. Amazon Go, an offline grocery convenience store operated by Amazon, is a market without checkout counters. Using an app to select items, automatic payment is made. This is possible through 'Just Walk-Out Technology' that integrates artificial intelligence such as computer vision, recognition sensors, and deep learning technology.

Kim said, "Computer vision technology, deep learning algorithms, and sensor fusion are three key technologies applied to autonomous vehicles," adding "Amazon has applied autonomous driving technology to commerce. Changes in how work is done, service product development, and processes are inevitable."

He emphasized, "It is important to transition to platform-based thinking from a corporate strategic perspective in response to technological change and to pursue open innovation. In the past environment, there was a fixed market, specific customers, and a certain value chain. Now only companies that create completely new customer value based on digital capabilities can survive."

Hyundai Motor has established open innovation centers in Israel and Silicon Valley, and KB Kookmin Card is running the FutureNine program to cultivate startups. Hite Jinro has also stepped up efforts to discover startups. Along with efforts to secure digital capabilities internally, attempts are being made to achieve mutual growth by securing 'human resources' that understand mechanisms for new technologies.

Kim emphasized, "It is more important to innovate through technology adoption than simply reading technology trends," and "we must change existing preconceptions and view technology itself as a medium for creating new business models."