Its all about mobility!

Mobile-commerce – At the heart of a retailer’s multi-channel strategy!

YOU have heard it before. How smart phones will revolutionize how consumers view the world interact with your business and impact your industry. In the new information economy, networks rule (aren’t social networks a case in point?). Small efforts can deliver big gains. And everything seems to be happening at warp speed. Wasn’t it just yesterday that we first saw and iPhone – and today – Steve Jobs has unveiled the new iPhone 4!

What Jobs will tell you though, is that fundamentals still apply: Knowing which customers you will target, what unique value you will offer, and how you will deliver that value in a way that gives you a competitive edge, one that you can sustain and build upon. What he might not explicitly say is that those strategic fundamentals are far more challenging to define and execute in today's dynamic world.

What works & what doesn’t!

So while – finding feature sets that will prove useful to the mobile customer – is usually not THAT difficult; prioritizing them into a meaningful roadmap – and delivering usable applications that leverage the capabilities of a native device can be difficult.

Functionality offered can vary – if you’re a large retailer with many stores across the globe and a significant online presence or if you’re a boutique fashion retailer – with very few outlets. For the former having a universal store locator, ability to browse and purchase, read customer reviews, browse weekly ads – could be core to a starter app. This can be expanded further to include mobile offers, list-management, proactive alerting, bar-code scanning and/or digital watermark based coupon delivery etc. For the latter, providing a catalog like feel – with images and videos that enhance brand perception would be more suited.

But before a retailer decides what features to build, most of them want to define what being in this space means, how it adds value, and how one can guarantee return on investment (or how much should they invest in this area – to gain the most!).

Mobile Strategy Challenges

The New Economy requires mobile strategy creation under uncertainty. This is the biggest challenge executives face today. The task is tougher for these are uncharted waters: There is little or no historical data to analyze. So, traditional strategic methods do not work well. Institutional and personal legacy systems (Peter Senge, the author of The Fifth Discipline calls them ``mental models'') are perhaps the biggest barriers to strategic change today.

Little do we realize that our ‘mental model’ of how the world works forms the context for decision making. These ``mental models'' are deeply trusted, because they got us where we are today. However, these were formed on the basis of past data, and probably are not a true reflection of the future. So, leading indicators of change, rather than lagging ones, are crucial to strategy.

Ok! So we need to be mobile! Now comes the part when you want everyone on the same page. Should mobile strategy be driven by the .com business or should corporate and brand marketing take the lead? Shouldn’t this really be owned by someone who runs and manages stores – after all most people are looking for instant gratification and might just use their smart-phones to find the closest store or to research a product they have in their hand! But, wait a minute – what about our business customers? And how do we enable consumer loyalty programs or mobile offers without suitable representation at the table? Hey all this is good, but we need to ensure that the technology architecture is right, consumer data secured and will not require significant rewrites of existing systems! Should one have an “evolve-as-you-go” plan or should you “look-before-you-leap”?

Bottom line: It wouldn’t be challenging if it were all that simple right?

To complicate matters, another formidable hurdle to deal with is as yet evolving standards. Multi-device support is crucial. Should one go with a WAP based site or does one have to build individual apps for an iPhone, a Droid & a Blackberry. How does one deal with an open app platform like Android Vs a big-brother-will-tell-me-how Apple iTunes policy? Darn! We’re already late in the game – how do we get a headstart? What if we want to go launch globally – would I be able to support multiple languages?

Conducting an indepth mobile landscape analysis of what other retailers are doing, which technologies are being leveraged the most, and which are the most popular consumer mobile applications out there – can go a long way in helping craft m-commerce strategy. The insight is to substitute traditional methods for innovation, using huge doses of ingenuity in the process. Having something new and engaging will definitely want the consumer to download an app, and play with it often.

One sees opportunities for large retailers to leverage technology being built by quick and nimble mobile upstarts like Expicient Inc (www.expicient.com) that have come up with a SaaS based mobile cloud product for retailers. Other firms that have made inroads in this space are Usablenet and Digby.

Other technology players that specialize in m-commerce and have multiple retailer clients include Unbound Commerce, Vortx and Moonshadow eCommerce Inc. And numerous e-commerce platform vendors have been adding m-commerce components to their offerings; these companies include Sterling Commerce (now IBM), Demandware Inc., GSI Commerce Inc. and MarketLive Inc.

One thing tho is certain that while it might be less than desired, to embark on a journey without a clear idea - perhaps the most serious risk is waiting too long to tread the water. The maxim is: ‘Stay still and you do not learn to swim, you can only drown’.

Strategic imperatives

So what does all this mean for you? CEOs, retail store czars, digital marketing executives of today need to understand that fundamentally, there are three kinds of barriers to ‘mobile strategy’ today. First, the external world is changing too fast to keep up with. There is accelerating change in technologies, channels, (mode, form and delivery of) service offerings, regulation, industry structure and boundaries. Understand that you’re not going to be able to keep pace with it – on your own. In any case mobile development & hosting is not your core competence – sourcing and selling retail products – online, in-store and now on mobile devices is!

Second, it is tough to get the organization on the same ‘page'/. While corporate executives are busy fighting battles about who gets to lead the corporation in the new economy, there are other unfettered unknown entities that are winning the war!

Third, management often tends to keep looking for `the answer’, one based on linear extrapolation of the present. The result is that if management does not get it, they do not fund it.

Leaders today need to realize that strategic thinking in the mobile economy is a process, rather than an event, like those held in plush resorts, and conceived during weekend getaways. Ergo, the need of the hour is directional strategy: That leverages on constant learning and realignment. It is quite like laying a railroad for a train that is already running. You need to mount horses and scout the terrain constantly. Who knows, you might end up joining tracks with someone, instead of building one on your own.

The process is not straightforward. Becoming an efficient mobile-business however does not mean overhauling the bedrock of your business -- changing strategies, organizational structures, technologies, processes, and people. Though, it IS a big job, and you may not have the resources to go it alone.

As in most things, having the right partner here makes all the difference. You need to thoroughly evaluate your choice of partner: Would it be one of traditional consulting firms or smaller mobile-only ‘boutiques’? And if you can find a partner or two – that understand the traditional world of application development in the retail world, and are also well-versed in emerging technologies – you can’t go wrong! The key question to ask is: Do they really cut it in the high-velocity, high-stakes mobile commerce world?

The author is a Managing Partner with Expicient Inc. and can be contacted at darpan.seth@expicient.com.