So far, new iPhone´s owners seem satisfied. Among the various new features, major changes include: a wider screen, a thinner and lighter design structure with respect to the iPhone 4S, a faster processor, an improved camera, a 4G mobile broadband, and a new and smaller dock connector.

Apple attempted to distance itself from Google: the iPhone 5 has a new iOS6 Maps; therefore, it is no longer using Google maps, but it now has its own version. According to a few first users´ feedback, the new map doesn´t seem to have received very positive reviews, as it seems that the new Apple-maps are not quite reliable and precise as those of Google Maps.

Distancing from Google has also meant the removal of the Google´s YouTube App (though downloadable from apps).

Let´s give a closer look to some of the new iPhone 5 features.

Design

The new iPhone 5 is wider and lighter. The back of the phone is now made of aluminium and it´s only one piece going all the way to the sides, holding the front glass and making it stronger compared to the 4S version.

4 inch retina display

The display is quite larger: 4-inch instead of the 3.5-inch of the iPhone 4S, which makes the new iPhone slightly taller than its previous version. Cnet.com editors have said “you’re going to have a hard time going back once you’ve used it”. The new screen adds up a new entire row for app/icons to display above the keyboard and a wider movie/video view and a landscape-oriented video. The wider screen also makes the pop-up notification less intrusive than before.

The new display has 18 percent more pixels for a 1136-by-640 resolution with an enhanced colour saturation.

A6 chip

The new A6 chip increases performance and graphics making the new iPhone twice as fast compared to the A5 processor. According to Apple, the chip is also 22% smaller than the previous one.

The new iOS provides a wide range of new features, including new facebook, shared photo system, maps, siri, passbook (a digital wallet app that helps you store documents such as boarding passes, gift cards, tickets etc.), phone and more.

The new Siri

Siri has now considerably improved, by becoming a new “virtual-voice-assistant”. Through Siri is now possible to find and book restaurants, post comments on twitter and facebook, find films ´reviews and schedules, find out football scores and many other info.

I sight camera: panorama shoot

The new iPhone 5 camera has been greatly enhanced. As far as megapixel goes, they are always 8 as in the iPhone 4S, but the new camera has a five-element sapphire crystal lens, a fast f/2.4 aperture and an hybrid IR filter. It also includes a lower light mode (it works better than before in a low-light environment), and a 2 f-stops. It has increased reduction of noise and it is up to 40% faster than its predecessor.

Probably its biggest innovation is the Panorama feature, which now allows taking panorama pictures in a very easy and intuitive way. Compared to other androids´ panorama systems, this one allows the user to move around while shooting in panorama mode, while having the software composing the final picture without distortions.

Further, the new iPhone 5 has a Nano-SIM compared to the Micro-SIM of the iPhone 4s. A new design of earphones (or earpods), a new and smaller charger (the lightening connector) and enhanced battery life.

For owners of the iPhone 4S, the software can be updated into iOS 6, giving the possibility of having many of the new features of the iPhone 5.

For more information on the new iPhone 5 features visit the Apple page.

-Images Credit: www.apple.com

ABOUT AUTHOR: 

Sara Coppola is a creative content writer within the fashion clothing industry at Miinto and is now lunching herself into freelance writing. When not writing Sara loves to travel, take pictures and keep up with the latest fashion trends.

1. User Experience

User experience is probably the most important reason as to why the consumers keep coming back to a few sites while there is no loyalty for others. The objective should be to make online shopping so easy and convenient that customers won’t think twice. User experience is more than just user interface design: it encompasses all aspects of the end-user’s interaction.

Human Factors International published a white paper on user experience and it suggests that what creates a truly successful eCommerce experience is the dynamic synergy between usability, power, persuasion and branding. The figure below shows the five dimensions of user experience.

Five Dimensions of User Experience

It is important to remember that user experience is dynamic, because it changes over time as the circumstances change. What was good yesterday in web 1.0 is not good today in web 2.0 and what is good today will not be so in coming years. In the year 2000, even an online catalog was a big deal but today consumers expect the offline experience while buying online. Some retailers have started to get fitting room online so that the consumers can get experience as close to a physical store as possible. Who knows, tomorrow the buying experience might shift to videos or gesture.

2. Focus on Supply Chain

An online store is much more complex than a physical store due to scale of business and delivery to the customer. In most of the cases, the SKUs (Stock Keeping Units) are also much higher than that in a physical store leading to added complexity. Therefore it is very important that the online stores focus at least 50% of their efforts on the supply chain.

A number of start-ups have relied on drop shipping which involves transferring customer orders to another company, who fulfills the orders by shipping the items directly to the customer on their behalf. However, with increasing competition, drop shipping may not be a viable option as consumers are not ready to wait. In fact a number of companies have started same day delivery which is not possible in drop shipping without compromising on quality. Hence, the best available option would be to stock inventory in the warehouse which can be an expensive proposition. I am not proposing that warehousing might be a better option than drop shipping. It is for the individual companies to decide basis their own unique situation but in general the trend is likely to be towards in-house warehousing.

Delivery is another important aspect of supply chain. Timely delivery has started to emerge as a key differentiation. Indian eCommerce sites like FlipKart and Jabong have in-house courier services to overcome the uncertainty owing to poor infrastructure. Time will tell if the companies can really own the courier services without having a major dent on their bottom lines or added complexity in the operations. However, the consumes have started to expect faster deliveries.

3. User Reviews

Studies have shown that consumers have more faith on user reviews than what the seller has written on the site. According to a recent survey from PowerReviews, 59% users get influenced by user reviews (refer to the figure below). The same study shows that almost half (48%) buyers consider user reviews a must on any retail site. Unbiased reviews help consumers make decision faster. Once the consumers make up their mind, it is unlikely that they would visit other site to find a better product or a better deal.

I find the user reviews on Amazon and Tripadvisor the best across all the sites. No wonder both the companies are doing exceedingly well.

4. Social

Social media has started to change the way we shop online. The data in above chart clearly shows the impact of social on the buying behavior. Such is the power of social that social commerce is emerging as an important sub-set of eCommerce. User reviews are important for any site but in future, I would not be surprised if the online retailers start to rank the reviews by social distance from the consumer as anybody would trust the family and friends more than unknown people. Tripadvisor highlights the reviews from social graph very well and it is one of the reasons for its popularity.

Social Log-ins impact the behavior of the shoppers and the consumers really do not want to create yet another digital identity. A study by Monnetate shows that almost 40% consumers in US prefer using social logins to creating a new/guest account on e-commerce sites. The consumers using social log-in also spent relatively more time on the site compared to people who cannot comment or log-in using their social identity. I am reproducing the infographic below from Monnetate for the benefit of the readers (Please note that the infographic is based on survey in US).

5. Mobile

Mobile is a mega trend that the digital commerce entrepreneurs cannot ignore. The internet usage on mobile will be far higher than that on fixed line, e.g. in India, the mobile internet traffic has already exceed the internet traffic coming from fixed line. Mobile has inherent benefits of location, imaging, sensors, etc. which would allow the entrepreneurs to creatively use mobiles for digital commerce. I had written a post on the top trends in mobile commerce which highlights the reasons behind proliferation of mobile for commerce.

6. Customer Service

Nothing can take away the importance of great customer service. Good customer service is central to improving customer loyalty, encouraging positive referrals, and increasing sales. Retaining customers is especially important for e-commerce stores, where online competitors are just a few clicks away. Customer service is especially important in today’s socially connected world as consumers can harm the image of a company with a single comment.

Meeting consumer expectations is very important for any online retailer. This means honor the commitments made to consumers at any cost. If a retailer promises to make the delivery in 5 days and delivers in 4 days then the consumer is happy but if the retailer promises to deliver it in 2 days but delivers in 3 days then the consumer is not happy. On the face of it, in the second case the delivery was faster than the first case but it is all about the promise made to the consumer and hence the expectations set for him.

7. Analytics + Upsell/Cross-sell

Any online store captures enormous data on consumer and can capture consumer’s attention anytime in the funnel. A Forrester study shows that when online retailers suggest relevant products, they increase the average basket by 47 percent and the number of products sold by 27 percent. Amazon’s key strength is its data analytics capabilities and the way it uses the data to  to upsell or cross sell other products. The benefit of analytics is huge as the retailer is able to get more out of the same customer thereby increasing customer profitability.

When correctly implemented and interpreted, web analytics provide eCommerce merchants with a wealth of valuable, actionable data that can be leveraged for great benefit. One of the techniques that is being used a lot these days is called the “Big Data Analytics“. Big data analytics is a process that allows you to examine large amounts of data of different varieties to uncover hidden patterns, unknown correlations and other useful information. Any online store aiming to be highly successful should be spending significant resources on analytics.

8. Business Model

Business Model is perhaps most important aspect of any business. Business model consists of the 3 V’s

• Valued Customer – Who is the customer?
• Value Proposition – What is the pain point that we are solving?
• Valued Network – How are we solving the pain point?

9. Application Programming Interface (API)

APIs are a set of standards and instructions that enable the software applications to talk to each other.  Many entrepreneurs ignore the importance of APIs in the initial development phase. This is a costly mistake as they miss out on the opportunity of others creating on top of that they have themselves created. Today, the online world is more connected than we think. No player can do everything by himself but in partnership with others, it can provide a complete experience to the consumers. By making APIs a priority and integrating them into ecommerce platforms, online retailers will be able to enhance the user experience across multiple touch points like smartphones, desktops, kiosks, tablet, etc. Today over 20K shopping and payment APIs are available

10. Images

The high street stores spend huge amount of money on display and interiors of the store to attract the shoppers to their store and then make them spend more than what they had originally planned to. The same hold true for digital commerce. The user interface is like interior decor of the online store but then the images make the interface come to life. Images make everything better. And that’s a good thing, considering how several big shifts in the social media world are now placing a bigger emphasis on using high-quality photos in content. The infograpic below from MDG Advertising shows the impact the images are having on the eCommerce.

In this post, I have deliberately not talked about the IT infrastructure, uptime, etc. to keep focus on the important business aspects which sometimes get missed. I would like to get your feedback on the issues I have raised and please add if I have missed anything.

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But if you want to make your online business operations more efficient even while on mobile, it is important that you are using the smartphone platform that suits you best not only to your needs but also with your working nature. It’s because you’ll be relying on your phone for most of your business deals, appointments and other tasks on a daily basis and you need to use one that complements you best.

Hence, if you are caught in a dilemma between using Apple and Android, then you may want to read through these points first so that you can come up with the right choice:

1. What kind of apps do you use for business?

When it comes to accessing online programs and features via mobile, you will definitely have to rely on apps. There are many apps these days that are designed not only for business, but as well as for work and personal organization, and these can be downloaded and installed on your phone or tablet.

If you are more into the more innovative apps, then you might want to use an Android instead of Apple. For one, there are far more apps designed for Android phones as compared to Apple, practically because it serves to be a more generic platform that already been embraced by different phone manufacturers these days. As a platform, Android is more open to using new apps, while in Apple, you are limited to apps that are specially designed for it.

2. OS Stability

Meanwhile, if you want a long-lasting smartphone that is able to keep up with the fast-paced lifestyle of the online business then Apple is the way to go. Why? Apple products are crafted to remain compatible amidst software upgrades and other changes, whereas Android-based phones and tablets tend to be less retroactive. Even though Androids market share is growing (you can see this chart for a reference) this fact still remains.

For example, if you are using a first generation iPhone, you can still enjoy its best features as a smartphone when you upgrade its iOS. However, when it comes to Android phones, if you need to do a software update, you may experience compatibility issues as the apps built for the latest version of Android may not work well with the previous releases.
Getting an iOS upgrade isn’t free though, and the costs aren’t cheap. However, some people view this as a very good investment, as they are not complied to switch to new phones or use new apps from time to time.

3. Merchant Services

If your business relies on mainly on merchant services, like ecommerce, or if you are transacting payments from clients on a regular basis, then using Apple would suit you better. There are more merchant-related apps designed for iOS phones and tablets as compared to Android devices, and these enable you to process payments via credit/debit cards and online payment systems. Also, developers who create apps for Android devices under this field base their designs on iOS apps, thus choosing the more stable apps to use might just provide you with more benefits. There’s still a lot of room for growth in the mobile payment sector, see this article we posted on mobile payments for more details.

4. Other Uses

Of course, while you use your smartphone or tablet for business purposes, there are also times that you useit for personal leisure. When it comes to apps that involve games, music and entertainment, and other forms of leisure, you may want to use Android instead. Indeed, Apple has iTunes, and an Apple Store where you can get their latest apps for both fun and leisure, but the selections remain to be limited.

Overall, if you are looking for a smartphone platform that you can use strictly for business, then Apple beats Android. It’s because when doing business online or via mobile, you’re not only after innovation, but as well as long-term stability. Indeed Android offers high potential when used for business, but you have to be careful on selecting the features and apps to use so that you not only enjoy the latest features and enhancements that they offer-more importantly, you are doing business within a stable mobile framework.

This is a guest post by Andrew Scherer who helps local firms find the best business answering service online.

Image credit – Nine Tech Blog

Going for gold! Enterprise mobile tech startups’ challenge to keep their eyes on winning part of a $1million dollar prize fund

Unveiling a new way for young mobile upstarts to achieve recognition and reward

The Olympics are on everyone’s minds (and televisions) these days.

The opening ceremony was amazing and the sportsmen and women have inspired us all. But the Games are nothing compared to the years of training the athletes have undertaken to get to the top of their game so their bodies and minds would be at their best when it mattered.

Olympic athletes have a lot in common with the entrepreneurs who compete in mobile tech startup land. Day in, day out, these entrepreneurs and the teams they create build products and services, flex their marketing muscles, polish their customer service, and research new markets with the goal of being the best every day.

The Path to Tech Startup Success

Many enterprise mobile startups will “get gold” with a successful exit via acquisition by a larger vendor or service provider. For others, IPO will be their reward. Others will not succeed. There are many reasons for tech startup failure, but perhaps one of the most frustrating reasons is “not in the right place at the right time” syndrome. Having worked with many successful mobile startups (and some others that were unfortunately not so successful), the most frustrating thing is when the startup has better technology than competitors who end up getting acquired or receiving private funding for many millions, sometimes even billions of dollars—and the more innovative company is left on the sidelines. The key reasons for tech startup failure are often quite simple: The buyer or investor didn’t know the company existed, or if they did, they did not value the brand enough. Having the right connections and a highly visible brand are so important for tech startups, these considerations should never be neglected. However, financial constraints and lack of experience in sales, marketing, and PR are often challenges for tech startups, especially in the early stages before VCs sit up and take notice.

The Challenges of Information Technology Awards

The tech startup community greatly values awards, much like Olympic athletes covet gold medals. The likes of Global Mobile Awards, Red Herring, AlwaysOn and many others offer very valuable recognition, but some IT awards have a more general focus, which means the more consumer-focused and perceived “sexier” mobile technologies get the most attention, while enterprise and B2B mobile innovations can be overlooked.  IT awards can also be quite expensive, both in terms of time and money. Some awards have restrictions such as being intrinsically linked to participation in an event, such as the fantastic RSA Conference Innovation Sandbox, an award that excludes any non-exhibiting companies.  Finally, let’s not forget that the prize for many of these awards is a logo, a press release, and a fancy dinner, which the startup often has to pay for itself. It is challenging and expensive to enter many IT awards, let alone win them — and even if you do win, it is questionable whether the value of the award is commensurate with the time and capital investment necessary to enter the award.

The Tech Trailblazers Awards: Taking Innovative Enterprise Mobile Startups into Gold Medal Territory

To get around these challenges, we developed the Tech Trailblazers Awards to focus on enterprise technology startups and to allow them to compete amongst their peers. Of course, recognition itself is not enough.

With huge industry support, the Tech Trailblazers Awards offer much more than just a prize and promotion; they offer real benefits from a prize fund with a value estimated at $1million, plus first-rate mentoring from the VC and vendor communities. We also reward all the entrants with a goodie bag of prizes worth over $3,000 for the administration fee of just $295. For those who can “sprint to the finish line” and submit their entries by August 17^th, there is an early-bird discounted fee of just $250. The final deadline is September 12^th at 23:59 PT. For those with cool mobile tech for enterprises based in emerging markets such as India, China, Russia and South Africa, you can also enter the emergin markets category free of charge alongside your mobile technology entry or for just $50 as a standlone entry into that category.

Entries from enterprise mobile startups are also invited in other enterprise IT areas of big data, cloud, mobile, networking, security, storage, sustainable IT and virtualization. If you’ve got mobile tech fire, we want to hear from you. Good luck!

For more information, please visit: www.techtrailblazers.com

Or follow the Tech Trailblazin’ buzz on twitter here: @techtrailblaze and hashtag:  #TTAwards

The global growth in internet usage is close to 8% and most of this growth is driven by emerging markets like India, Vietnam, Africa. The global internet user base is now 1.5 billion.

ComScore is a leading organization that tracks the internet usage across the globe. The chart below from ComScore shows that India is one of the fasted growing internet markets (Only Vietnam @101% growth & Venezula @61% growth are higher than India but in the chart I have ignored them due to lower base). The number of internet users in India are 60 million but since ComScore does not take corporate and cyber cafe usage into account, I would estimate the actual usage to be higher by 30%.

Given the growth and the increasing large base, I am very optimistic for internet based services for India. Apart from eCommerce, I expect services like e-Governance, digital money to prosper in India. Similar predictions can be made about Russia and Italy which are growing very fast as well. The problem with Italy is the broadband speed which is much below the global average.

China is the biggest internet market in the world and no wonder, it has emerged as one of the largest eCommerce market as well ( Taobao has gross revenues of over $30 billion). US which at one point of time had a dominant position in the internet industry is no longer the force it used to be. I would not be surprised if new online business models start to emerge from the countries like China, India and Russia.

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According to the National Communications Commission (NCC) Chairwoman Su Herng, any ISP falling short of advertised claims involving broadband speeds will be open to a fine. This is only a start but it could certainly open up a huge can of worms across the world. Asia is quickly becoming the dominant force in tech which makes this move more serious than some might think.

Considering that throttling is a huge problem in today’s society, this movement could mean a lot to consumers. Many of these people are unaware of the term throttling or how pervasive it actually is. To those unaware of what throttling is, Wikipedia defines it as the “reactive measure employed in communication networks to regulate network traffic and minimize bandwidth congestion. Bandwidth throttling can occur at different locations on the network.” Throttling can be a real problem, especially for those who need the continued speed for their careers or businesses.

Through the use of misleading advertising, it makes consumers even more unaware of exactly what internet service providers are doing. Most ads throughout the world are well regulated, however not in this case. ISP’s are not required to blatantly state that they throttle, much less to what extent they do it. A move to require a more obvious display of how much each ISP throttles is much needed.

Taiwan is definitely at the head of this movement. They will begin checking broadband speeds of local telecom operators. These checks come amid a public outcry of allegations that internet service providers are overcharging for slow internet services. This could cause a slow ripple across Asia and possibly lead to changes in Europe and the US. This would be a very welcome move seeing as how many ISPs such as AT&T and Verizon are well known for throttling their services shortly after the customer begins to receive service.

On one hand, this is only a start. The checks by the NCC in Taiwan will only be looking at the operations plans that are submitted to the committee. Where as they do not have any current plans to fully keep the providers to the word in terms of all advertising. There needs to be a two stage approach. One front needs to be in checking the reports that are turned into the appropriate governmental agency. The other front needs to be on the advertising side. The committee charged with checking the accuracy of advertising in a given country needs to work closely with a governmental agency that has the ability to issue fines and penalties.

Throttling is not only associated with home internet, it is also prevalent in the mobile market as well. AT&T recently announced that it will begin throttling its 4G with unlimited data plans users as soon as they hit 5GB of usage. This may seem like a lot of data, however for someone who truly needs a vast amount of data and high speed for something such as work, 5GB might not seem like that much.

In the end, much of the discussion comes down to transparency. Throttling is definitely an issue that needs to be talked about more, and Taiwan is starting that conversation. No longer can we allow mobile broadband carriers to promise one thing, and yet limit it at the same time.

Image Source: http://www.flickr.com/photos/jcuthrell/4306049240/sizes/m/in/photostream/

I myself have been evaluating options to take a plunge in the eCommerce space and hence have analyzed the sector very closely. I believe that the opportunity is large (larger than what analysts currently project!!!) but there are issues that require urgent attention. The top five concerns of the eCommerce market in India are as follows:

 1. High Customer Acquisition Cost

One area that most of the entrepreneurs consistently underestimate in their business plans is the cost of acquiring a customer. Most business plan assume heavy reliance on social media and internet advertising. The general myth is that the cost of acquisition on internet is very low. However, in my opinion, it is even higher than that of television advertising. Today cost per click is around Rs 15 and if the conversion rate (buyers to visitors) on the site is 1-2%, the cost of customer acquisition comes out to be Rs 750-1500. This is very high and requires repetitive purchases from the customer to recover the cost. Another way of validating the customer acquisition cost is the sops being doled out by existing sites on the member get member schemes. Overtime, when the customers start coming directly to the site, the cost of customer acquisition falls significantly but till that time, the business owners need to cover the cost.

2. High Churn/ Low Loyalty

I have heard multiple times that the Indian market is very large and we have just hit the tip of the iceberg in terms of customer adoption. I have no doubts on the size of Indian market but the problem is low loyalty. The big brands are yet to be created on the internet and hence the brand loyalty is very low. Consumers are currently bargain hunters on the internet.

In the high acquisition cost scenario, it is important to retain the customers for a long time. If the average ticket size on the internet is Rs 1000 with 10% margin, then the customer needs to buy at least 15 times to recover the cost of acquisition (assumed to be Rs 1500). Currently this is not happening. Most of the sites are getting high number of new customers every month camouflaging the high churn. The eCommerce companies are measuring the gross profitability and not the customer lifetime value. The moment the new customer addition drops, the profitability goes for a toss. This is what has struck the group buying sites like Snapdeal which saw fast adoption in the past. This is not limited to group buying sites and other eCommerce formats are also witnessing the high churn and low loyalty problems.

3. Cash on Delivery

Cash on Delivery (COD) has been touted as the innovation to counter the low credit card penetration and payment security issues on the internet.  COD is a substantial proportion of the sales today contributing to anywhere between 11% (for Perperfry) to 60% in most of the cases.

The COD is unsustainable as it pushes up the cost of transaction by Rs 30-60 per transaction. Given the low profitability and small ticket size on eCommerce sites, the entire gross margin gets erased by COD. On top of this the problem is that of high returns as the consumers often change their mind by the time the goods arrive. The returns are as high as 40-45% of all the COD shipments. COD also poses scalability issues for the eCommerce sites in the long term as the logistics companies would find it hard to scale to the required levels. The other problems associated with COD are long lead times before the revenue can be booked, fraud risks and higher working capital requirements.

What amazes me is the fact that there is no incentive for the customers to use electronic payment on sites like Flipkart. Why would I take any risk with electronic payment if I can get cash on delivery at the same price.

4. High Cash Burn Rate

The capital requirement for any eCommerce venture is very high contrary to the popular belief that it is easy to set up an electronic shop. At a recent conference, a venture capitalist mentioned that a niche vertical eCommerce venture needs $50 million of funding over time while a horizontal player would need $300-400 million funds. Leaders in the e-commerce space (ones that have raised money, have large teams and are aggressively pursuing growth) are spending $1-2 million (Rs 5-10 crore) a month, including on marketing, overheads and salaries. At this rate of burn, smaller firms with scant capital are unable to cope. In my back of the envelop calculations, a company would need to spend at least Rs 1 million per month in the first six months of existence even if it is bootstrapping. Therefore it is important to raise money early in the game.

5. High Inventory/ Poor Supply Chains

Most of the eCommerce venture are complaining of the excess inventory and absence of liquidation market in India. The poor supply chain compounds inventory problems due to unpredictability of the supply. The cost of carrying the inventory is very high and successful ventures would need to tackle the supply chain issues if they really want to run a scale business. The other problem is in unpredictability of delivery to the customers leading to higher returns.

Summary

I do not think any of the above mentioned issues are insurmountable. The opportunity is huge to let it go. Entrepreneurs need to be disciplined sticking to the basics of business without getting carried away by the rush of capturing the opportunity. Venture Capitalists would always push the companies to grow fast and faster but it is upto the entrepreneurs to focus on the long term growth.

I know this is a very debatable subject would like to hear the views of the readers on the potential and challenges of Indian eCommerce industry. Please do comment on this story.

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Retailers are a worried lot today.

Convenience, Access and Discounts are three reasons for growing popularity of electronic commerce. Mobile devices go a step further in providing convenience and have better enabling technologies than a computer. A mobile device is ubiquitous and is well integrated to context of location, time and people. This makes me believe that the next wave of digital commerce will be on mobile phone. As per Forrester report in June’11, the mobile commerce is expected to reach $31 billion by 2016 in the US. Globally, the mobile commerce could reach $119 billion by 2015 as per ABI Research. The projections made for mobile commerce do not include the mobile influenced sale which my opinion is much larger than the actual sale. A large number of people might visit a retail store due to a coupon they received on their mobile which technically is not commerce but to my mind should be included in the potential. According to Forrester, by 2014, 53% of sales in the US would be influenced by the internetand mobile would have a large role to play. Given the fact, 44% of mobile users in the America have smartphones and over a quarter users globally have smartphones (source Nielsen), the mobile commerce is here to stay!!!

What is driving the Mobile Commerce?

Apart from the increasing smartphone penetration, the entrepreneurial activity in this area is fueling  the growth of mobile commerce. In the last few years, the emergence of mobile applications has pushed the capabilities of a mobile phone to the maximum. Mobile applications are not only utilizing the features of the mobile but have also increasing the consumption of software on the mobiles. Simple mobile application user interface is making it simple for consumers to search and adopt digital commerce on mobiles. Mobile phones may have a small screen but are very handy when you are on the go. Many consumers do impulse buying which means that when they are leaving home, they have no idea what they are going to buy and where they are going to buy. Mobile Marketing can therefore influence them significantly if there is a good deal available and that deal can be communicated at the right time. Context based advertising is becoming a big driver for mobile commerce. Another factor that is working in favor of mobile commerce is the fact that the consumers today are more comfortable in using a mobile phone and using their credit cards for electronic transactions.

Top Ten Trends in Mobile Commerce

The promise of mobile marketing is its ability to reach the right consumer, at the right time, and in the right place—including at the very moment and point of purchase. The potential power of mobile is further magnified when you consider that smartphone users spent most of the time on social networking applications, like Facebook, when interacting with their devices. The term “So-Lo-Mo” (for social, local, mobile) has been coined to refer to this opportunity. The trends below reflect the mobile commerce opportunity not only from the actual transaction perspective but also include the sales that gets influenced by a mobile phone.

1. Proliferation of Shopping Applications In the last few years, a lot of shopping applications have come up from eBay to Amazon to Bestbuy to Macy’s on iOS and Android platforms. These applications are taking advantage of the mobile features like context (location, time and people) which have made it easier for the consumers to use them. As a result, Forrester estimated that in 2011, over 24% iPhone users and 21% Android users used a shopping application

2. New and Diverse Mobile Advertising Formats One of the key development in the last few years has been the maturity of mobile advertising. The mobile advertising has moved from banner advertising to coupons, real time call to action, last minute deals, etc. Real time access to potential customer makes the advertising meaningful and interested audience can react spontaneously to the deal. Mobile coupons have a redemption rate of 15% to 40%. Compare this to traditional print coupons, which are redeemed at less than 2%. Imagine a cinema hall giving last minute discounts by broadcasting the deal to the people in the vicinity if it finds the hall half full. Recently, MacDonald’s promoted the geotargeted mobile ads within Pandora’s iPhone application. The mobile ads recognize the user’s location and show them how far away the nearest McDonald’s location is. As per Gartner report, the global market for mobile advertising will double in size in 2012 from $6.6 billion in 2011. By 2015, the market will be worth $20.6 billion, but will still have much further to grow beyond that.

3. Growing use of social media/ social commerce There is overwhelming evidence that people trust their friends more than the claims made by the retailers selling them and hence integration of social media is a definite boon to mobile commerce. People look for reviews and recommendations from their friends and other consumers and in exchange are willing to share their network with the retailer.  IBM recently released a study that showed that consumers are more than willing to share with retailers through social networks. In exchange for a better, more personalized shopping experience, consumers will tell all about their media consumption (75%); age, race, gender, and income (73%); name and address (61%); and lifestyle details such as hobbies and other interests (59%). Social commerce and mobile has been the biggest trend of mobile commerce

4. Growing popularity of Local Commerce Social-Location-Mobile are the buzz words these days. Services like Foursquare and Facebook Places are offering deals based on loyalty by using the check-in functionality. If a person is going to a particular bar more often, then the bar tender can figure out the loyalty based on the number of check-ins that the person has done in that bar and can therefore offer a suitable offer. Shopkick goes a step further that gives incentives on footfalls and hence driving footfalls into a store. This way the mobile phones are driving online traffic to offline stores. Group Buying sites like Groupon and deal coupons are contributing to the popularity of local commerce. Almost all the popular deal sites have mobile applications and they have seen steady increase in traffic from the mobile phones. 50% of Groupon’s business is expected from mobile in next two years.

5. Increasing use of Mobile Phones to get Product Reviews/Information Mobile phones are helping the consumers to make informed decisions while they are in a store. Last year nearly half the consumers in the US used their mobiles to look for product reviews. The consumers used the bar code readers to get the product information.

6. Proliferation of Price Comparison Applications Price comparison applications from eBay, Amazon and TheFind are becoming a real threat to the physical retailers. Many customers when they walk into a store are using these applications to find the price on an online store or even the other physical stores in the vicinity. The retailer loses the sale in case the customer is able to find a better deal somewhere else. Earlier in the absence of information, the conversion of a walk-in customer was much higher. The chart below from Comscroe shows that pricing is important for the consumers and the stores are having lost sale due to price comparison applications.

Real time inventory availability for many physical stores is being used by applications like Pricegrabber to get the best deal available across the city.

7. Enhanced In-store Experience using Mobiles Stores can improve the in-store experience through product recommendations tailored to individuals based on their previous purchases, as well as items they have scanned and loyalty card data. As mobile commerce continues to rise, so does the importance of the in-store shopping experience. Along with convenience, personalization and savings, retailers need to start planning for what is next: the push for sustaining customer loyalty and mobile payment solutions. Retailers are already flocking to mobile marketing, with 91 percent either having a mobile strategy in place or in the process of developing one, according to a new report from Shop.org. Overall investment in mobile is also growing. Retailers invested $34.8 million in mobile last year and $14.6 million in tablets. These numbers increase significantly for 2011, with retailers planning to spend $220.9 million on mobile and $14.6 million on tablets.

8. Evolving Mobile Payment Technologies New mobile payment services are proliferating across the world which are helping the cause of mobile commerce. Square is one such service and has been the fastest service to reach $1 billion billing. Square enables mobile phones to accept credit cards thereby removing the need for a POS. Even Paypal, eBay and Amazon have reported higher mobile sales over the last couple of years. Another technology that is finally shaping up is Near Field Communications (NFC) that allows the users to make proximity payments at merchant stores. Visa and Google are also trying hard to get a pie of the lucrative mobile payments value chain.

9. Growing popularity of Lead Generation applications It is very often that we plan to go out for dinner but want to find out the table availability before we reach there. Opentable is an application that is now being used by millions of people to book a table in the restaurants. Just as Opentable makes it possible to book a table in advance, Styleseat is helping consumers make appointments at parlors and spas. Similarly, Zocdoc is helping people find a local doctor and make an appointment with him. I see this as a strong trend going forward as it is targeting a real need of consumers and not replacing any other traditional channel.

10. Synchronized Experience A nascent trend that is emerging is marrying the offline and online world by retailers. This means one can order grocery online and then pick it up from the store thereby saving time and yet getting the delivery when it is required. There can be very many examples where internet is being used to enhance physical experience. This has the power to remove the inconveniences of offline commerce and yet include the joys of the physical commerce.

Finally, I would leave you with an interesting video from Forrester on multi-channel shopping

http://www.youtube.com/watch?v=avyuN5nt_w4

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There is no tablets market. It is just the iPad market.

In this article I have attempted to evaluate the above hypothesis and arrive at a conclusion one way or the other.

Current State Analysis:

If we look at the current trends, it would appear that Apple is in a dominant position with no vendor being able to provide a credible alternative. Apple had 67% market share at the end of Q3’2011 and no other vendor was close to it (refer the market share data in the chart below). There are close to 40 vendors on Android platform and their combined share is around 27% (dipped from 30% in Q2’11). The largest Android vendor is Samsung and apart from Samsung  (who produces the new 7″ Google Tablet T-Mobile and other popular models) no other vendor has even 1% market share. Motorola Xoom is now not even in the picture. Apple has sold 50 million devices in all till date against the Android sales of 10 million.

RIM and HP had huge plans for the tablets market but within a quarter of launch, HP has decided to quit the market and RIM is struggling. There are indications that RIM might also quit the tablets market if it does not do well after the latest changes in its strategy. Amazon has launched its tablet, kindle Fire but it is yet to hit the market.

All in all, currently there is no player who can even be termed as challenger to Apple.

Future of Tablets

Today, the tablets market is largely undifferentiated with all vendors trying to emulate Apple’s success but this is likely to change very soon as the market matures. I see the following 3 trends emerging that would change the way tablets are market today:

1. Price Discovery: All the vendors attempted to compete with iPad and sold at a similar price. This was a big mistake with the consumers preferring to buy iPad instead of other tablets as the value proposition of other vendors was weak at the same price point. When HP liquidated the stock at $99, their tablets suddenly vanished from the shelves. So much so that HP decided to produce some more tablets. Range of tablets are coming in across various price points mirroring the smartphone market which has products from $100 to $700. RIM has also decided to drop the pricing of the tablets to $249 while Amazon has launched its tablet at $199. I see $100-200 as a very lucrative and viable price segment for tablets. There is certainly a window of opportunity for someone to come up with a low-cost, user-friendly tablet likely built on Android that would have mass market appeal (chances are that it would come from a Chinese vendor).

2. Differentiated Value Proposition: So far the tablets have attempted to target the same consumer segment with similar value proposition. Their attempt has been to be the “Laptop Lite” and replace the netbooks. However, the market is much larger if tablets are not seen as replacement for either smartphones or netbooks. Instead vendors should look at it as a device that has multiple value propositions and we might need different kind of devices to meet those demands. Amazon’s Kindle would appeal to people interest in content and cloud based streaming services while the Chinese players can capture the enterprise segment that need cheap functional tablets. Indian Government’s $35 tablet is a perfect example of targeting a segment (education in this case) with a stripped down tablet.

3. Services Ecosystem: We have all witnessed the success of iPhone and one of the primary reasons for the success of iPhone was the ecosystem that Apple created around the device. Even in tablets, the services ecosystem is likely to play a big role in its success. However, in this ecosystem, the tablets will not be central. Somebody would develop an enterprise application and would sell the device as part of the managed service contract. I see a possibility of a company developing a courier management application on tablets or an order management system thereby creating a huge tablet demand as low end with minimal processing and multimedia capabilities.

Will the iPad party continue forever?

No, I do not think so. Apple is enjoying the high market share till the time people are not able to discover the use of a tablet. Today people are using a tablet as a gaming and browsing device. This is surely going to change once the differentiated value propositions emerge with different use cases. Once the tablets start getting used by sales guys or restaurant order management, the market would surely move beyond iPad.

Kindle Fire is most likely to spoil Apple’s party as it has a very good value proposition in terms of content and has priced the product aggressively. Amazon is subsidizing the Kindle and plans to monetize through content which would be difficult to match by any other competitor except for Apple. In a nutshell, we’re entering a near disposable e-reader/tablet era that will split the market between Amazon (consumption based profits) and Apple (high end brand profits). Every technology company caught in the middle is going to have some serious problems.

I see the Chinese players coming out with cheap tablets and capturing a sizable small and medium enterprise (SME) market. The Chinese players would be very aggressive and would not care so much about the brand and direct distribution as long as they can sell. They would be willing to customize the tablet based on the end user requirements that the bigger players would be reluctant. Their impact on tablets market would be similar to their impact on the mobile phone market.

In the longer term, Android would emerge as the operating system of choice as the cheaper tablets will have no other choice but to go for Android. In the process, the other tablet OS like BBX (RIM Playbook) and WebOS would die the natural death as they lack the applications ecosystem.

In the end, I would say that there is a tablets market besides the iPad market provided the other players create value propositions knowing fully well their strengths and more importantly their brand limitations.

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The chart below from Statcounter shows the global market share for mobile browsers. Opera is the most popular mobile browser.

The share for Blackberry browser follows the declining trends in RIM’s appeal. Similarly, Android browser has consistently gained market share since June, 2009 and is now the most popular browser after Opera. Interestingly, iPhone browser has shown a pretty flat share despite increasing popularity of iPhones.

Click on Mobile Browser Market Share to download the excel file of the chart data from Statcounter.com
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In Q3-2010, 62% of tablet owners were below 34 years but by Q2-2011, only 46% of tablet owners are below 34 years of age. Another interesting fact is that eReaders are now more preferred by females . Sixty-one percent of all eReader owners are now female, compared to a mere 46 percent in Q3 2010.

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VoIP (Voice Over Internet Protocol) is a very popular and growing facet of the communication market.

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