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Mar 20, 2017 | 8 min read


Digital is Eating the Party

Innovation Trends at SXSW Interactive 2017

Elisa-Jo Harkness

Senior Project Analyst

South-by-South-West, the massive, 3-part music, film, and interactive media festival held each March in Austin, Texas, has long been a gathering place for the best thinkers in culture, technology, and industry. Of course, this festival is not for the faint of heart: the content is voluminous and chaotic and the sessions are hit-or-miss. First-timers and even veterans can easily get overwhelmed by the sheer size of this conference + festival, with its many tracks, sessions, special events, and exhibitions.

Of course, this festival is not for the faint of heart: the content is voluminous and chaotic and the sessions are hit-or-miss.

Innovation is a mix of art and science: this means that, while designers and developers and strategists may have a lot of frameworks and methods that help us move forward empirically (lean, agile, design thinking, etc), we’re also groping our way in the dark a large part of the time. One of the great things we get at SXSW Interactive is to hear our peers from other places and perspectives discuss the trends they see and the successes (and learnings) they’ve experienced. This happens in sessions but also at parties and even standing in line.

Facebook’s launch of Messenger Day immediately prior to the opening of the Interactive portion of the festival may count as a point in favor of the continuing relevancy of the event to the movers and shakers of the digital realm, but we’re generally pretty okay letting the big unveilings come at CES or at GAFA-hosted conferences like Google I/O, because that makes South-By a place for conversation, reflection, and connection – a place where what’s-brand-new is less important than what-we-can’t-stop-talking-about. With that in mind, here are five key trends FABERNOVEL saw at SXSW Interactive this year:

1/ AI is Everywhere

“This year was all about Automation and AI,” says Dominique Piotet, CEO OF Fabernovel US. “You couldn’t go to a single talk where AI and Bots of any type were not mentioned.”

Until recently, AI and Machine Learning were widely considered to be too technical to interest c-levels outside of tech companies, but we’ve seen that changing in the past year – and the change was visible at SXSW. Not only was Artifical Intelligence – or a technology enabled by it – the central topic of many panels, but AI-related sessions were consistently oversubscribed, with long lines winding around the corridors of the many hotels that fill downtown Austin. Therefore, for us at FABERNOVEL it fell well as we are convinced that the subject is of real importance and that it is time to overcome the buzzword. This is also the reason why our teams led by Tom Morisse publish a weekly feature article on the subject.

Another area of interest we’ve tracked at Fabernovel for some time now are the maneuverings of GAFA, or Google, Apple, Facebook, and Amazon – the group of Silicon Valley behemoths that have redefined the economics of success in the digital age.

Dominique Piotet noted the relative absence of these giants from the official SXSW schedule: “GAFA don’t sponsor many parties and they are not on a lot of panels. But they are on most of the lips and few talks don’t mention at least one of them.” After all, how can you talk about AI – which was really all anyone was talking about – without discussing Facebook’s image recognition, Amazon’s recommendation engine, or Google’s Cloud suite for Machine Learning?

2/ Social Impact Matters

Pierre Letoublon, the Director of PARISOMA and a former FABERNOVEL consultant, highlights the good and bad social impacts of technology as key takeaways of this year’s conference: “Kate Crawford, of Microsoft Research, gave a great keynote about AI’s “Dark Days,” detailing how much fascism and data have in common: centralized power, mass tracking and documentation, and an air of infallible neutrality with no transparency. Hannah Arendt once said that the only thing authoritarian regimes in the 20th century lacked was proper technology. But today, with the help of Palantir, ICE is ready to have the best mass deportation system history has seen. Counter actions like the launch of the AI Now initiative to increase collaboration and research efforts on algorithms are badly needed.”


But the tone of social and political discourse at the conference was more pro-active than despairing. “It was good to see the tech industry waking up from a long sleep and realizing it has to stand up against politics,” says Letoublon. “While it was no surprise to hear Chris Sacca – at the origin of a fundraising campaign for the ACLU on Twitter – noting the new decorrelation between ad spend and election results, it was interesting to see David Karp launch the #TechSupportsPP campaign on stage with Cecile Richards, who was definitely the real star of the show, calling for action, donation, and support. And in tech-dominated times, one key take away was that politics is still relying on simple things like spontaneous marches and the underestimated impact of calling your representative. Too bad 5 Calls wasn’t in the competition for the Innovation Awards.”

3/ Science-ing Design & Designing Science

Design has always been a major track at SXSW, and this year we saw the intervention of AI and Neuroscience in design discussions, as well as a human-centric approach to Machine Learning and other research developments. This reflects a larger trend we’ve been seeing, as the importance of design generally – and especially user-centered approaches to the design of both software and physical products – grows in influence.

Take for example the fully-packed ballroom in which Nancy Giordano led a discussion on Artificial Intelligence and Human Intelligence with Siri co-founder Adam Cheyer, Braintree founder Bryan Johnson, and Ginkgo Bioworks co-founder Reshma Shetty.

Though ostensibly a panel of scientists approaching ‘intelligence’ from different angles, the discussion returned repeatedly to questions of design, as both the tinkering with natural systems and disruptive experimentation leading to entirely new ones.

At the same time, this year saw a spike in interest around empirical design methodologies like Navin Iyengar’s session on A/B Testing at Netflix, which was so popular he agreed to offer an encore later that day.

And the rise of interest in chatbots following advancements in AI-powered Natural Language Processing (NLP) technology has opened design further still.

Conversational Design was a major topic at SXSW Interactive this year, with sessions by leaders like hashtag-inventor/conversational-interface-evangelizer Chris Messina and PullString CEO Oren Jacobs, all observing the combination of art and science required to execute a convincing artificial interlocutor.

IBM Research’s Raphael Arar and Bob Moore led a session on Applying Science to Conversational Design that had the audience so glued to their seats they wouldn’t get up when the fire alarm sounded.

4/ The World is Changing

This trend may be the least “new” thing we caught at SXSW in 2017, but that doesn’t make it any less on-point. “A lot of the Brands & Marketing track was old news, but there were some great sessions,” says LaShãda DiCosmo, VP and Managing Director of Fabernovel’s New York offices. “I loved ‘How New Media is Redefining the Meaning of Luxury.’ Jonathan Cheung, the Head of Design for Levi’s, is really tapped into how young people are driven by values and don’t want to counter their purchasing choices, while staying fashionable.

Sustainability and human rights are increasingly placed at higher values as you look at younger and younger demographics. With this new millennial consumer, avocado toast could be as much of a symbol of luxury as a Louis Vuitton bag.”

The changing attitudes and behaviors of younger consumers may be presenting a challenge to large brands, but for startups and digital-native indie brands who know how to connect to this demographic, this gap presents a huge opportunity. Says LaShãda DiCosmo – who joined FABERNOVEL following years of work at Unilever and L’Oreal – “indie brands don’t have large budgets, they don’t use billboards and certainly don’t advertise on television, but they still manage to make meaningful connections with their consumers. »

Social media, of course, has been a key avenue for these digital-native up-and-comers. “That’s where the people are,” explains DiCosmo.

“These brands communicate with consumers in an authentic way that allows them to broadcast their messages more broadly and personally – and to gather data that helps them understand consumer behavior and develop and market their products more effectively.”


5/ Big Brands are Catching Up

While the rise of young, digital-native brands is no surprise this year, FABERNOVEL was pleased to see an uptick in the presence of major brands at the festival – not just as sponsors and hosts, but as meaningful participants in the conversation. Major brands like Levi’s are building innovation labs and launching technology-driven initiatives and dipping their toes into AI with increasing bravado. Jeff Michels, COO of FABERNOVEL US, pointed to strategic partnerships as a major avenue driving innovation for large brands. “One panel with ShopStyle and Neiman Marcus focused on influencers and bloggers who can make significant impact on retailers’ ability to reach new audiences and leverage their behavior,” says Michels.

And these partnerships aren’t just magnifying proven strategies, but helping major brands to experiment and iterate with new approaches. “Neiman Marcus has been turning to ShopStyle to better select high-performing bloggers. The focus is no longer on power bloggers with a million-plus followers, but instead on micro-influencers of 100,000 to 500,000 followers who are more niche and represent more curated styles that speak to a tighter-knit community of shoppers.” Michels also cites the session with Marc Jacobs and Sally Singer, Creative Digital Director of Vogue, on the impact of technology on his work: “He was a professed technophobe, but he sees technology as another mechanism enabling him to experience life serendipitously. In the mornings he looks at his Instagram account and scans for new looks and influencers.”

The designer will contact influencers directly, and has even asked for them to model at his shows.

The transformation that designers like Jacobs and retailers like Neiman Marcus have embraced has been a bit slower in coming than some other industries, and fashion still has a way to go in making the full leap to the digital future. As DiCosmo notes, “while AI isn’t a magic fix-all for fashion brands, it’s also taking too long for it to be adopted, because not many people understand it.” Digital presents particular challenges for large and established brands because they have something to lose. “For some companies the fear of loss is more painful than the potential success that they can gain thus change becomes resistant for large companies. But it’s necessary for them to remain relevant, so the change will come – it’s just a question of how long it will take.”


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