Archive for the ‘Mobile Computing’ Tag

The App Economy takes off

Mobile computing is growing so fast and evolving so quickly it is hard to make sense of it all. The most recent leap, which includes sharing platforms, wearables and mobile payments, are based on unique service applications (or apps) that run on a smartphone and seamlessly handle everyday activities.

Although still in its early days, the rise of the app economy will have profound implications on the nature of many industries, the ways consumers interact with businesses and how companies structure their operations.

Since the mid-1970s, the world has gone through a technological revolution roughly every 10 years. It’s then taken between seven and 10 years for the new technology to achieve mass market adoption. However, the app economy is different. Many of the upstarts in this sector quickly started making gobs of money, usurping their competition and expanding globally.
For example, service-sharing platforms Uber and AirBnB are disrupting traditional industry players and are significantly changing consumer behaviour and value expectations. Their rapid growth plus big upside make them worth more than the traditional taxi and hotel companies they compete against. This one example should be a clarion call for more traditional businesses battling it out in the consumer and corporate services markets.

The stakes are huge: Mobile commerce will account for 24.4% of overall ecommerce revenues (which are themselves growing rapidly) by the end of 2017, a study by marketing automation firm Hubspot found. Add incremental revenues from app-based sharing platforms and you are probably north of $100 billion in mobile ecommerce revenues in the U.S. alone.

Among the many facets to consider, I believe leaders ought to pay close attention to these two:

Service apps take over

For most people, life is increasingly centered around a mobile device and the services it enables. Increasingly, apps address your personal needs, often in ways never imagined. Uber and Lyft are replacing car ordering; TaskRabbit is handling our deliveries and dating apps such as Tinder are helping people find a life partner.

So too are people’s professional lives poised for change. A recent job-matching app, Switch, allows candidates to thumb through job listings: flick left if uninterested and right to register for a potential work match. Another swipe-if-you-like competitor, Jobr, uses information from LinkedIn to recommend jobs that candidates might find interesting. Since its launch last year, Jobr has submitted more than 100,000 job applications for its members each month.

Businesses are also jumping on the bandwagon, using apps to re-engineer traditional but important practices. Last year, Zappos, an online retailer based in Nevada, scrapped formal job postings and replaced them with a new site encouraging candidates to engage with each other and the firm in a way not dissimilar to online-dating forums.

Although the service apps business is growing rapidly, there is still plenty of upside left. Existing providers can drive higher usage and fees by adding new functionality, entering new geographic markets and retuning their service to appear less like a standalone, phone based-app. As well, there are many opportunities for a high-quality model in unexploited personal and corporate services categories.

Tightening the relationship

Apps are now the focal point between the customer and company. Companies can now engage deeper and longer term with its customers to create a 1:1 relationship, and with it higher revenues, loyalty and satisfaction thanks to three symbiotic forces: ‘always on’ connectivity via smartphones; advanced data analytics and; collaborative social technologies.

To fully leverage this opportunity, transaction-orientated businesses will evolve into service subscribers requiring them to engage throughout a customer’s or product’s life cycle irrespective of channel. In retail banking, for example, you might receive a message on your smartphone with your daily account balance, personalized RRSP advice in January, or ways to spend your credit card’s loyalty points.

To make long term engagement a reality, companies will need to redesign their service/product model (i.e. what and how they deliver value), pricing strategy and marketing programs, not to mention their technology infrastructure. Moreover, their apps will need to evolve beyond transaction-based functionality to include personalized content, multi-platform integration, location-based services and recommendation engines.

To avoid disruption and to capitalize on opportunities, companies should already be exploring and investing in apps applicable to their market and relevant to their customers. But they will also need to be mindful of getting it right: thoroughly understanding customer needs, designing a seamless customer experience, building practical data analytics capabilities and delivering compelling and relevant content. However, to truly take advantage of the app economy, leaders will also need to be mindful of the impact of emerging technologies like wearables and mobile payment services.

For more information on our services and work, please visit the Quanta Consulting Inc. web site.

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Delivering the omni-channel experience

New technology-based “channels” are giving firms the opportunity to more deeply interact with customers.  However, adding new channels to a traditional business can trigger marketing misalignments, internal strife and significantly higher cost.  Managers who can overcome these challenges to deliver an omni-channel experience can grow revenues, enhance customer value and improve margins.

A channel can be any intermediary between a customer and the manufacturer of a product or service. Traditional channel partners include retailers, outsourced call center and wholesalers.  New channels – handheld devices, apps and soon, wearable computers – are enabling a host of activities including mobile commerce, information gathering and social interaction. Entering this brave new world poses significant risks for a company.  Consider these three areas:

  1. Marketing

Programs designed for different channels can easily work at cross purposes, leading to reduced marketing efficiency and effectiveness.

  1. Information Technology

Adding new technology to heterogeneous infrastructures is not simple or inexpensive.  Furthermore, channel must operate reliably and securely across different platforms, networks and geographies.

  1. Organization

Channel managed in divisional silos hinders operational integration and drives up complexity, resulting in higher administrative costs and conflict.

All of nothing

To overcome these challenges, many firms are pursuing an Omni (meaning “all” or “every” in Latin) Channel strategy, whereby all sales and support channels work synergistically to seamlessly deliver a firm’s brand promise to each customer segment. In turn, the operating and IT model is organized to deliver on a consistent experience at every customer interaction.

A way forward

Some companies we have researched are meeting the omni-channel test – but many are not.  Successful firms recognize the strategic importance of their channels and share some key attributes, including:  a customer-centric philosophy; an emphasis on organizational and technical integration and a collaborative mind set inside and externally.

New software can help enable customer centricity across every channel.  As an example, NexJ Systems, a leading software provider, developed an enterprise-wide solution that gives managers the information and tools to manage all their channels for maximum performance.  According to CEO and Founder Bill Tatham, “At one of our large insurance customers, a single view of the customer and every interaction with that customer is shared by head office, the contact center and the field agents, allowing collaboration in selling and customer value maximization.”

One firm that is getting it right is TD, which is no small achievement in the complex retail banking space. At the core of TD’s effort are three key principles:

  1. Put the customer first

TD launches and manages channels & services based on what the customer wants, not just what their technology can provide.  The firm receives a daily flow of usage data across each channel generating real time insights on a user’s behaviour as well as needs states.   This customer-centric philosophy ensures each channel maximizes the value delivered at the lowest possible cost.

  1. Have a supportive organization

TD understands that consistent leadership, a clear ethos and engaged workforce can make or break the omnichannel experience. Their unique “Better Bank” culture emphasizes continuous improvement, collaboration and a longer view of program payback.  TD’s digital channels are not managed as siloed businesses.  Instead, they reside in a horizontal, enterprise-wide structure, which helps drive marketing & operational integration, rapid execution and higher system ROI.

  1. Be bold but implement prudently

Though keen to adding new technology, TD takes a prudent approach to introducing new services.  The Company adopts an end-to-end operating view and a “continuous improvement” approach to designing and implementing the right technology.  Before launching any capabilities, multi-functional teams carefully evaluate their options and select the ones that best fit their brand and IT strategies.

“Customers want us to know them, and we’re continually evolving our notion of convenience to make their journey with us more comfortable, no matter when, where or how they choose to bank with TD,” says Teri Currie, Group Head, Direct Channels, Marketing, Corporate Shared Services and People Strategies. “We are leveraging TD’s strong North American brand and scale to develop connections with our customers by focusing on their needs, looking specifically at their journey with us to understand how we can make their lives better.”

TD’s approach is working.  The Company is rated number one in customer satisfaction (according to J.D. Power) among the Big 5 Canadian Banks for In-person, ATM, Online, Automated and Live Phone.  This accomplishment is not merely a function of the company’s strong bank network.  TD is also number one Canadian bank for mobile banking according to Commscore.

Providing an omni-channel customer experience can generate significant rewards, though it might not be an easy journey.  Nonetheless, managers have little choice. In a low growth world, failing to prioritize an omni-channel strategy can result in missed growth opportunities, higher customer attrition and increased operating costs.

For more information on our services or work, please visit the Quanta Consulting Inc. web site.