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Catching the Mobile Commerce Wave

Catching the Mobile Commerce Wave

If substantial numbers of consumers are turning to apps to research and shop for products and services, bypassing Web search engines and other standard Web-based methods, the companies that furnish apps have an advantage over those that do not. At this moment, every enterprise should be devising new strategies for reaching customers through mobile applications in addition to the Web.

By Dave Uhler
04/07/12 5:00 AM PT

Riding the wave of technology change these days is a bit like surfing. The ocean and waves often change much faster than our ability to stay out in front of the transformation. Now another current is approaching the wireless world as mobile commerce curls to challenge conventional e-commerce.

This ascendance of mobile devices -- smartphones, tablets and wireless laptops -- demands that enterprises create their own strategies for benefiting from the opportunities in mobile commerce.

Enormous mobile growth

While Web-based commerce remains strong, mobile is playing a rapidly escalating role in business, according to a recent report from the Pew Research Center.

The estimated 7.3 billion people occupying the planet in 2016 will be using 10 billion mobile Internet-capable devices, according to the report. In fact, the projected amount of additional Internet data movement for just 2015 will be three times the size of the entire current mobile Internet.

Of particular importance to businesses, researchers reported that in the 12 months between June 2010 and June 2011, the time spent on mobile apps outpaced the time consumers spent on the Web. During that period, the time consumers spent with apps increased 91 percent.

In 2011, the Gartner technology research firm predicted that by 2015, the number of mobile application development projects for smartphones and tablets will outnumber those for PCs by a 4-to-1 margin.

"Smartphones and tablets represent more than 90 percent of the new net growth in device adoption for the coming four years," Gartner said.

Added to these forecasts is a report from Forrester Research that predicts mobile commerce will grow at a compound annual rate of 39 percent through 2016.

Unique Challenges and Opportunities

While this massive reconfiguration of the online landscape is in many ways heartening -- consumers will be better able to communicate with brands from any where at any time -- it also can be challenging and even frightening for companies that do not have a mobile strategy.

If substantial numbers of consumers are turning to apps to research and shop for products and services, bypassing Web search engines and other standard Web-based methods, the companies that furnish apps have an advantage over those that do not.

At this moment, every enterprise should be devising new strategies for reaching customers through mobile applications in addition to the Web. Whether enterprises develop ways to monetize their apps or apps form a key component of a mobile marketing campaign, mobile strategies that include apps are becoming critical to the growth of enterprises all around the world.

Apps may not be appropriate for every enterprise, such as a company that offers services to demographics that do not embrace mobile commerce. These companies still must consider a mobile strategy, however, to understand which audiences should not be targeted versus which hold the greatest potential.

Strategic Decisions

Mobile strategies enable enterprises to better understand their customer data and to deploy that data in the most effective way to reach mobile consumers. These strategies should take into account not only the immense growth in mobile usage, but also the emerging ways in which mobile communications are changing and diversifying.

For instance, near-field communications and other mobile payment systems, such as barcode scanning, are expected to drive an increase in the use of mobile payments worldwide. As the popularity of these methodologies increases, businesses will subsequently develop perimeter authorization technology and ways for the retail environment to interact with individual consumers.

Similarly, advancements in mobile technology will allow service companies to provide new capabilities. As an example, retailers could create a personalized shopping experience by transferring a profile from a mobile device to the store's IT system. Even heating and air conditioning can be controlled via communications between a mobile app and the building's infrastructure to reduce overhead costs.

The prospects for future technology deployment can be dizzying. Enterprises that fail to strategize risk being left behind as consumers stampede to those companies that offer exceptional mobile features and interaction through apps and other mobile techniques.

The Customer Perspective

Where should a company begin, then, in its consideration of a mobile strategy? First, understand mobility from the consumer's perspective:

  1. People expect simplicity in their mobile interactions
  2. People expect better access to data
  3. People have personalized expectations for their interaction with brands

Meeting these expectations may require a shift in an organization's mindset to incorporate these three considerations:

  1. Every business needs to gain a thorough understanding of the options that are available for capitalizing on mobile technology, along with the opportunities that are best suited for mobile enablement within each enterprise. These efforts will help leadership develop an approach toward how and when to invest in the deployment and use of mobile technology.
  2. Mobile strategies should be used to build a foundation on which a company can invest in solutions, technology, and headcount to ensure that its long-term investments are sound and productive.
  3. Corporate leadership should realize that mobile applications are a means to an end. Apps should always enable something within the business -- whether for employees or customers -- and should not simply stand alone as an interesting but disconnected feature.

Take Advantage of the Coming Mobile Wave

Mobile commerce offers unprecedented opportunities for those enterprises that take a strategic approach toward their company's role and opportunities in the mobile marketplace.

Those with successful strategies will grow in new ways and into new markets, remaining ahead of the pace of change and positioning themselves more effectively for the next alteration in the landscape.


Dave Uhler is national managing director of Slalom Consulting.


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