Mobile Manifesto

I just returned from two weeks discussing strategy with mobile commerce executives across Southeast Asia. Despite having spent considerable time in North America, Latin America and Europe, this was my first trip to the region. I found the similarities and differences intriguing.

In North America and Europe, execs I meet often mentally write-off Asia as so foreign and different that their experience aren’t relevant. Perhaps this is true for South Korea and Japan which have very specialized markets; however, in Southeast Asia there continue to be far more similarities than differences.

For example, everyone is struggling with mobile adoption growth. Mobile is happening – and it’s happening fast – but, it’s still around 2-4% of online. Everyone wants it to grow faster, while struggling to support what they have. Many companies simply turn mobile on and customers show up with little or no promotion.

Similarly, travel and financial services lead the way. These verticals have higher adoption and the most mature solutions in each region around the world. Many of these companies are on their second or third major version of their mobile offering. Retail mobile commerce is poised for explosive growth when retailers fully commit to the mobile channel.

Southeast Asia has had mobile offerings longer than North America in particular. Asians have also more consistently supported feature phones and SMS than Americans and Canadians, since they have large populations of both rich and poor.

The result is that Asian executives confirm an important trend we’ve been seeing from our perspective in the industry:  visits increase permanently when you add mobile channels. Furthermore, with complete coverage, visits split evenly between mobile web and native applications.

Many U.S. & European companies are still wrestling with whether to support transactions on mobile web or native applications. The data very clearly shows the answer must be “both.” North American banks – and apparently Southeast Asia – have moved on and is finding ways to innovate and compete across all channels.

All channels are not equal, however. The Asian execs see similar transaction conversion rate differences to what we see across channels most prominently in North America.

In particular, we see iPhone native applications having 30% higher conversion rates than other channels (including Android native apps and mobile web). We expect this behavior to change over time as devices change and users – and companies – are more experienced with mobile.

The Asian execs confirmed that they have seen these patterns change over the years they’ve been live with mobile. Therefore analytics support and the agility to react to changes are absolutely critical for continued success. Today’s mobile strategy isn’t likely to be next year’s strategy.

Of course, the Asian economies are seeing much stronger growth than the U.S. and Europe which are mired in sovereign debt crises and the Great Recession. Asian companies are planning their second (and third) acts with mobile. Instead of considering new channels or new features, many Asian companies are planning major new lifestyle functionality around loyalty and rewards.

Furthermore, around the world, enterprise mobility and mobile commerce are meeting to create new, more strategic employee-facing applications that solve new problems using the devices employees choose while still securing company data and streamlining processes.

It’s clearer than ever to me that mobile is driving innovation through all its incarnations and across every channel of the business from bricks-and-mortar, online, and beyond. Now, I’m off to India.

Europe once led mobile

Mobile commerce was born in Europe, but Europe has lost its way.

Japan and South Korea could argue they were first. They could also argue they still lead the world. Maybe they’re right. However, European style mobile commerce was patterned around the world. Kenya’s M-PESA style branchless banking for the developing world is another pattern that succeeded and is thriving, but isn’t applicable to the well-banked around the world.

Somewhere along the success of the BlackBerry and the iPhone Europe fell behind.

For example, all the UK banks but one implemented Monitise. All the UK solutions provide nearly identical look-and-feel with nearly identical capabilities that once were ground breaking like balance inquiries and person-to-person electronic-check payments if you know the recipient’s bank routing number and account number.

New features and support for new phones is slow in coming. Even worse, talking to UK bankers, they’re not bullish on moving the needle because they think their competitors aren’t either. I’ve had similar conversations with bankers and retailers in Germany, Sweden, the Netherlands and elsewhere in Europe. Europeans are moving slowly, thinking there’s no hurry to compete in the mobile space.

This exact scenario played out in Canada over the last two years. Canada now leads the world in mobile commerce (in my opinion, for this type of developed world model, per capita). A few years ago, Canadians were comfortable with their basic mobile web implementations they had rolled out in the early 2000s. Pilots were done here and there, but nothing bold or large scale had been done since 2000. Executives were comfortable doing nothing, because equilibrium was the status quo.

Then CIBC launched their iPhone app. Apple marketed the app nationwide. It seemed every bus shelter and TV commercial break nationwide highlighted the CIBC iPhone app. Almost overnight, Canadian mobile commerce changed. One bank executive ordered that they do whatever is necessary to become the leader in North America. The entire banking sector exploded into activity with may jobs changing and projects ramping up and the fierce competition continues. National and North American retailers also continue to pull out all the stops finding new ways to let consumers shop with their phone and it’s blurring the line between bricks-and-mortar and ecommerce.

Similarly, the U.S. started earlier and has more activity than possibly anyplace else. The Firethorn mobile banking initiative in 2006 and 2007 sparked U.S. mobile banking and it caught fire with Bank of America’s iPhone application. Soon pizza companies were letting customers place orders via mobile web but full-fledged mobile commerce is still ramping up in a number of verticals. I see waves of maturity in the U.S., with retail banking and travel leading the way, then retail mobile commerce, media and healthcare coming along.

European mobile banking looks very much like Canada. They made early progress, then stalled. Equilibrium won’t stay forever. Sooner or later someone will do something bold, possibly even an outsider. European executives that aren’t making aggressive plans to revolutionize their business with mobile will find themselves blindsided and rushing to catch up.

It’s not enough to make mobile a derivative feature of your online presence or to pick and choose how to offer mobile. The marketplace is dynamic and customers will decide how, where, and when they’ll engage with brands. Companies must reach customers in the medium they’re most comfortable with and in ways that are convenient and useful.

No one knows the right ways to do this for any one business yet. This is why it’s important to figure out now. Companies that are making mistakes now, are setting themselves up for success when it matters.