Thursday, 24 May 2012
The Paradigm shift from Web to Mobile
Right now we are witnessing the paradigm shift from Web to Mobile with an abundance of apps for smartphones & tablets, and truly functional platforms for mobile web services. In the first stage of the Internet world, now more than 20 years of age, we mainly had companies aggregating data and presenting it in an easy to digest fashion. Some of these Web 1.0 companies have already disappeared or are in decline (like Netscape and Yahoo), whilst others have succeeded and become real Internet Giants in the world of search algorithms and eCommerce (like Amazon, Google and eBay).
To my mind Amazon's smartphone app is absolutely one of the very best m-commerce applications. It makes searching easy, and the format of results is perfectly designed to fit the small touchscreen. You are never more than a tap away from a level of satisfying product or review detail. What Amazon offers the consumer is trust. Amazon gives me as a consumer a fair exchange of value. I like the recommendations and many of the business books or academic literature I purchase on Amazon are easy to read in the Kindle App on my iPad. This is a complete mobile service platform in my taste.
The Web 2.0 companies of today – or ‘Social’ as they are called – have done well thanks to the development of social networks for both personal and professional use (like Facebook, and LinkedIn). Now we are entering the third stage of the Internet with the rapid development of Mobile platforms. It will be interesting to see how the Internet companies will tackle the paradigm shift from the Web to Mobile. Judging by the recent Facebook IPO and its struggle with the mobile advertising platform this paradigm shift represents a new challenge to existing firms.
Smartphones and tablets are gaining ground everywhere in the world. Nearly a billion people now use mobile broadband across the globe and Ericsson forecasts it to be 1.4 by late 2012. Mobile usage of social media platforms is on the rise and time spent on Facebook’s mobile site has already surpassed usage of the website. In the Western world and Asia smartphones are selling like hotcakes – e.g. in Finland 77% of all mobile handsets sold in Q1/2012 were smartphones (compared with 50% in the previous year). And as I have written before on this blog tablets follow suit with sales forecasts topped each quarter.
If we look 4-5 years ahead into the future the forecast is that there will be more tablets than PC’s across the globe. And the smartphone penetration will be quite high. Perhaps the mobile handset – the powerful palm computer – will be the dominating device, from which we direct all our activities from personal communications to entertainment and media consumption. The smartphone will more than likely become a tool by which we can communicate with other screens at work and at home, and coupled with a second tablet screen literally everywhere we go. If you look at this development the smarpthone will become the ‘Mother of all devices’ and the hub of each individual’s communication with friends and peer groups. For an interesting futuristic view of this development and its relevance for media, please refer to the excellent piece of writing by Shawn Reigsecker.
No wonder the Internet companies of today are rethinking their future. Whilst many of the start-ups today have looked at the mobile service platform from the outset, the existing Internet companies may need to reinvent their business model. Easier said than done. For instance to date Facebook has made most of its money on the Advertising revenues on its traditional website. With increased mobile usage this is much harder to do, especially as banners are very disturbing on the smaller smartphone screen. Advertising needs to be more subtle, right now it is tested in the form of Sponsored Stories in your news feed. Another element Facebook has announced to add on to its business model is its own App Center, making it easier for developers to submit apps and for users to download apps. With this move Facebook wish to drive mobile app installs and reach more than 500 million people using Facebook on mobile devices.
For many social platforms like Pinterest mobile usage is an increased opportunity as people can pin interesting images on their smartphones and tablets. The more traffic the images shared on the social platform drive to commercial websites, the better for Pinterest. At the time of writing Pinterest is responsible for driving more sales to retail websites in the U.S. than Facebook.
The individual platforms are constantly evolving. Two or three years ago the mobile usage was marginal but has now boomed with new apps like Instagram, the already mentioned increased mobile usage of Facebook and the introduction of Google+. The latter may still have a lot less users than Facebook, but it boasts one of the most visual and easy to use mobile apps among the social media platforms. It remains to be seen how many active users Google+ will attract over time, however, this is of high interest as each new Google+ profile adds on to a database of individuals attractive to marketers.
A deeper understanding of the customer, their online habits whether web or mobile, and their purchasing habits have become essential. Retail companies need to make sure they are constantly learning about the new platforms as their customer live in an integrated online/offline world, where the geographic location of the individual adds opportunity to the offer. Both personal data, peer group recommendations and geolocation need to be taken into account when building a winning multichannel marketing strategy.
There is a lot to learn for the retail marketer, and it’s nearly impossible to know which new platforms will become mainstream tomorrow. I would place my bet on those who can best solve the issue of a functional Mobile service platform: this is a combination of service design and great UI (User Interface) craftsmanship.