Thought Starters: Uber, Machine Learning, “Alt-Right” Democracy and Globalisation

Thought Starters provides me with a chance to review and highlight some of the more  interesting (and hopefully well informed) opinions that I’ve read over the last few weeks. This edition is dominated by the fallout from the American elections with people looking at the reasons for the rise of such an unconventional candidate and a look at what we might expect from Donald Trump’s presidency:

Is the tide turning on Uber? There’s no disputing that the ridesharing model has become a key plank of our transport infrastructure. Question is will Uber’s pool of cash be enough to keep the company going until self driving cars arrive? Yves Smith and Eric Newcomer weigh in:

Published financial data shows that Uber is losing more money than any startup in history and that its ability to capture customers and drivers from incumbent operators is entirely due to $2 billion in annual investor subsidies. The vast majority of media coverage presumes Uber is following the path of prominent digitally-based startups whose large initial losses transformed into strong profits within a few years.

This presumption is contradicted by Uber’s actual financial results, which show no meaningful margin improvement through 2015 while the limited margin improvements achieved in 2016 can be entirely explained by Uber-imposed cutbacks to driver compensation. It is also contradicted by the fact that Uber lacks the major scale and network economies that allowed digitally-based startups to achieve rapid margin improvement.

Benedict Evans released the latest version of his Mobile is Eating the World presentation which looks at the growing synergies between mobile and machine learning, with a particularly focus on retail or automotive:

Lighting everything up with machine learning

Benedict’s presentation points to mobile apps as the dominant means for consumers to interacting with the digital world. As mobile becomes ubiquitous, we’re seeing consumers sticking to the apps they know according to research from Adobe in the US:

App abandoment is on the rise as consumers stick to the apps they know

Amazon is taking advantage of mobile technology to further automate the process of shopping with their soon to launch AmazonGo offering. Better experience for consumers, less employment for retail workers:

As mobile matures, we’re seeing the next gold rush emerging in machine learning. Sam DeBrule has pulled together a valuable collection of information sources if you’re keen to track developments in the sector as they increasingly spill over into the real world:

Machine Intelligence Startups & Tools

Providing a counterpoint to Silicon Valley boosterism is Om Malik’s column warning that technology doesn’t exist in a vacuum and that the startup sector needs to be more aware of these changes if it’s to avoid a major backlash:

“It is not just Facebook. It is time for our industry to pause and take a moment to think: as technology finds its way into our daily existence in new and previously unimagined ways, we need to learn about those who are threatened by it. Empathy is not a buzzword but something to be practiced. Let’s start by not raging on our Facebook feeds but, instead, taking a trip to parts of America where five-dollar lattes and freshly pressed juices are not perks but a reminder of haves and have-nots. Otherwise, come 2020, Silicon Valley will have become an even bigger villain in the popular imagination, much like its East Coast counterpart, Wall Street.”

Ryan Broderick tracks the rise of the “alt-right” in the US and Europe and how social media provides fertile ground for its growth.

“Facebook doesn’t want to challenge you, they don’t want to upset you, because they know that if you’re challenged on their platform, you wouldn’t want to use it as much,” Derakhshan said. “The very fact that you cannot show your reaction to anything you see on Facebook by saying that you agree or disagree or that it’s true or false and you can only show your emotions to it is very telling.”

UK’s telecommunications regulator regularly releases research looking at Britons’ use of media and technology. Their most recent report covers media use and attitudes among children and young people aged 5-15, providing a valuable window into where media is heading in the future:

Media used by children aged 5-14 at home

Pew Research’s research from the US point to ebooks market share as stabilising with a similar story for printed books. Another valuable finding is that consumers are now increasingly reading e-books on tablets, PCs and smartphones rather than just dedicated e-book readers:

Print books continue to be more popular than e-books or audio books

Americans have traditionally been strong believers in economic progress with the expectation that they will be better financially positioned than their parents. Research from Raj Chetty profiled by David Leonhardt points to this no longer being the case, a situation which is presumably leading to growing dissatisfaction with the political status quo:

Chance of making more money than your parents by age cohort in the US

Much has been made of Donald Trump’s call for bringing manufacturing back to the US with suggestions that he’ll bring in more protectionist trade policy. Mark Muro in his coverage of the American manufacturing points to how automation is seeing the sector become increasingly divorced from its blue colour labour roots:

More Output, Less Employment

Another initiative Donald Trump has been touting is investment in America’s infrastructure which is one area where the Democrats and Republicans could potentially find common ground…but the devil is in the details. Ronald A Klain’s analysis of the initiative suggests that it’s more likely to line the pockets of those already working on projects rather than providing a boost to employment:

First, Trump’s plan is not really an infrastructure plan. It’s a tax-cut plan for utility-industry and construction-sector investors, and a massive corporate welfare plan for contractors. The Trump plan doesn’t directly fund new roads, bridges, water systems or airports, as did Hillary Clinton’s 2016 infrastructure proposal. Instead, Trump’s plan provides tax breaks to private-sector investors who back profitable construction projects. These projects (such as electrical grid modernization or energy pipeline expansion) might already be planned or even underway. There’s no requirement that the tax breaks be used for incremental or otherwise expanded construction efforts; they could all go just to fatten the pockets of investors in previously planned projects.

China’s economic growth is unprecedented, but a darkening political climate has led to growing suggestions that this trend may be derailed in the future as the country adopts a more authoritarian stance:

% of world GDP from year 1700 to 2008

The rise of Donald Trump, Nigel Farage and Marie Le Pen among others points to a backlash against globalisation, but analysis from The Economist point to this trend not being shared by all countries:

Attitudes towards globalisation against change in GDP per person

Amanda Taub profiles Yascha Mounk’s research pointing to declining support for democracy among many developed countries, coinciding with the growth of the “Far Right”…Although Erik Voeten’s analysis suggests it’s not quite as severe as the graph below suggest:

Percentage of people who say it is “essential” to live in a democracy

Given the rise of the far right, Yale history professor Timothy Snyder’s 20 lessons from 20th century provides valuable advice on fighting a rise in authoritarianism  (even if it is aimed at an American readership):

1. Do not obey in advance. Much of the power of authoritarianism is freely given. In times like these, individuals think ahead about what a more repressive government will want, and then start to do it without being asked. You’ve already done this, haven’t you? Stop. Anticipatory obedience teaches authorities what is possible and accelerates unfreedom.

The Danish concept of hygge has become very much of the moment with its harking back to a simpler age but Charlotte Higgins suggests that the UK’s reinterpretation of the idea is not quite so healthy:

If, for Danes themselves, hygge has an element of fantasy – through the way it draws back from difficulties, difference and debate – then the British import is a fantasy of a fantasy. Hygge may be quintessentially Danish, but there is something utterly British about the nostalgic longing for the simple accoutrements of an earlier time – especially if it can be bought. At the same time, it is hard to deny that just at the moment, the most natural thing in the world is to want to huddle round the fire and wish the outside away. Settle in: it’s going to be a long winter.

The featured image is a MOMO mural from Sicily.

Thought Starters: ubiquitous smartphones, post-PC and universal basic income

Thought Starters provides me with a chance to review and highlight some of the more important or interesting research and opinions that I’ve read over the last week or so. This edition looks at the transition from a PC to a smartphone-dominated world, the story behind financial results from Apple and Facebook, the growth of Sci-Hub and a closer look at the universal basic income model among other things:

Benedict Evans profiles the increasingly ubiquitous smartphone and how the mobile market is changing as the technology becomes increasingly commodified:

Smartphones have unique scale for tech

Steven Sinofsky moves to an iPad Pro for his daily computing requirements and shares his experiences. As the PC loses its hegemony, raises new challenges and opportunities for businesses and entrepreneurs:

The shift to this new form factor and new platform will bring with it cultural changes that take advantage of what are perceived as disadvantages. As makers, being early is essential, otherwise you are late.

For more on the topic of post-PC world, I’d suggest reading Paul Thurrott’s reluctant forecast of the demise of Microsoft’s Windows and Steven Sinofsky and Benedict Evans rounding out their thoughts on the a16z podcast:

The release of quarterly results has provided a valuable window into the ups and downs of some of the world’s tech giants. Neil Cybart’s analysis of Apple’s financial results suggests we’ve reached peak iPhone, with sales hit by longer upgrade cycles and fewer easy growth opportunities:

iPhone Unit Sales Growth (trailing 12 months)

Apple CEO Tim Cook has emphasised the company’s service offerings in recent announcements. It’s worth having a read of Ben Thompson’s analysis of this move as the company looks to avoid being typecast as simply a maker of beautiful devices:

With regards to the iPhone, it’s hard to see its record revenues and profits ever being surpassed by another product, by Apple or anyone else: it is in many respects the perfect device from a business perspective, and given that whatever replaces it will likely be significantly less dependent on a physical interface and even more dependent on the cloud (which will help commoditize the hardware), it will likely be sold for much less and with much smaller profit margins.

Facebook had more joy with its financial results growing monthly and daily active users and mobile’s share of traffic although growing presence in developing markets is dragging down its average revenue per user. Whilst recent research suggests that people might be increasingly wary of sharing their personal thoughts on Facebook, the social network maintains a strong role as onramp to many consumers’ digital world as Will Oremus comments:

The company has reinvented itself in two distinct ways. First, Facebook as a platform has been quietly evolving into something different than a social network—something less personal, but no less useful. Second, Facebook as a company has been furiously hedging its bets on the future of technology and social media, to the point that it is no longer properly described as merely a social network—no more than Alphabet (né Google) is properly described as a search website.

So what has the Facebook app and site become, if not a social network? The answer is rather obvious when you watch how people use it. It has become a personalized portal to the online world.

Whilst tech unicorns have typically avoided the scrutiny of the stock market by staying private, analysis of sales of ping-pong tables in Silicon Valley suggest that venture capital funding might not be as free flowing as it once was:

Sales of ping-pong tables to companies at a Silicon Valley store correlate with venture-capital deals made during the same quarter.

Whilst we’re on the subject of startups, it’s worth reading Chris Dixon’s call for entrepreneurs to look broadly to better understand future threats and opportunities, namechecking automation of logistics, apps, video and voice services:

Think of the internet economic loop as a model train track. Positions in front of you can redirect traffic around you. Positions after you can build new tracks that bypass you. New technologies come along (which often look toy-like and unthreatening at first) that create entirely new tracks that render the previous tracks obsolete.

The American IAB has released research tracking consumers’ use of smartphones and tablets when shopping, pointing to the ways different age categories use their devices. This providing both a threat and an opportunity for traditional bricks and mortar retailers:

Smartphone as Shopping Assistant

John Bohannon profiles the growth of Sci-Hub which offers users a means of accessing copyrighted academic research regardless of whether people have the necessary institutional resources. The service provides a valuable source for researchers in less well-funded institutions, but usage statistics suggest that users include plenty of people with the necessary credentials and are simply looking for more user-friendly alternatives:

Server log data for the website Sci-Hub from September 2015 through February 2015

With predictions of automation threatening employment across an increasingly broad spectrum of jobs, there’s been growing calls for the introduction of universal basic income. This would essentially provide a guaranteed income to all regardless of employment status and has gained an interesting collection of supporters from both ends of the political spectrum. It’s something I am expecting to hear a lot more about in the coming months and you get an introduction to the concept from Tim Harford (shorter version), Andrew Flowers (longer version) and the Freakonomics team (podcast version).

The featured image is a Nerone mural from Bordeaux, France published in ekosystem.

Thought Starters: children’s media use, app streaming, Dribbbilisation and privacy

The following is a look through articles, research and opinion pieces highlighting interesting trends, developments and changes in the world you and I live in, with an emphasis on technology.

Ofcom released Children and Parents: Media Use and Attitudes Report this month which provides a detailed look at the media consumption and device usage of children and teenagers in the UK. Among the interesting statistics are changes in the social media usage and inevitably high penetration of smartphones:

Main social media site used by children

Consumers movement from a browser to an increasingly app based interactive experience poses a significant threat to Google’s business model where the majority of income continues to come from search.  Among the ways that Google is looking to address this threat is the deeper indexing of content from apps and the launching of app streaming smoothing the transition from search to app usage.  You can see an example of it in action below with a search for a hotel in Chicago leading to the Hotel Tonight Android app below:

Google App Streaming

A further indication of the growing importance of mobile can be seen in the growing share mobile is taking of ecommerce revenues in the US according to figures from comScore:

Mobile commerce as share of total ecommerce revenues

An interesting companion piece to comScore’s forecast are figures from the Wall Street Journal which point to a decline in retail space per capita in the US which is no doubt fueled by growing ecommerce sales:

Retail space decline

WeChat provides an interesting case study in how we might see the mobile ecosystem developing in the West with mobile messaging becoming a hub for an increasingly diverse range of services. Edith Yeung profiles some of the different services currently offered in China – we’re beginning to see this with Facebook Messenger’s expansion of functionality and there’ll no doubt be plenty more to come in the near future.

Paul Adams criticises many designers for paying too much attention to aesthetics and not enough attention to purpose in what he describes as the Dribbbilisation of Design (referencing design showcase site Dribbble).  Adams argues that designers need to give greater consideration to outcomes, structure and interaction, particularly as we move to an environment where interactive design permeates everything:
The Dribbblisation of Design

Tony Aube points to the move to an increasingly messaging based world driven by artificial intelligence as making the traditional model of visual user interfaces irrelevant:

“What I do believe, however, is that these new technologies are going to fundamentally change how we approach design. This is necessary to understand for those planning to have a career in tech. In a future where computers can see, talk, listen and reply to you, what good are your awesome pixel-perfect Sketch skills going to be?

Let this be fair warning against complacency. As UI designers, we have a tendency to presume a UI is the solution to every new design problem. If anything, the AI revolution will force us to reset our presumption on what it means to design for interaction. It will push us to leave our comfort zone and look at the bigger picture, bringing our focus on the design of the experience rather than the actual screen. And that is an exciting future for designers.”

Benedict Evans reviews the competition for control of the television which he characterises as a ultimately a sideshow to the broader battles for the PC and more recently the smartphone and tablet:

“Games consoles’ closed ecosystem delivered huge innovation in games, but not in much else. The web’s open, permissionless innovation beat the closed, top-down visions of interactive TV and the information superhighway. The more abstracted, simplified and closed UX model of smartphones and especially iOS helps to take them to a much broader audience than the PC could reach, and the relative safety of installing an app due to that ‘closed’ aspect enables billions of installs and a new route to market for video. It’s not that open or closed win, but that you need the right kind of open in the right place.”

GroupM has released its forecast for the UK media sector, with a continuation in the trend of decline in print advertising and robust growth from television and interactive advertising:

Media Spend Forecast

The Flexport blog looks at the overinvestment in freight shipping capacity where the impact has been compounded by a decline in Chinese exports leading to some unintended consequences:

“It costs $300 to move a 40-foot container from Rotterdam to Shanghai, which is barely enough to cover the cost of fuel, handling, and Suez Canal fees. Here’s some more context. Let’s say that you want to travel for a year; it’s cheaper to put your personal belongings in a shipping container as it sails around the world than to keep it at a local mini-storage facility.”

Germany has long been a manufacturing powerhouse (see below). What The Economist asks is whether the country can adapt to an environment where a greater share of the value added comes from outside the traditional domains of designing and assembling goods:

Manufacturing as percentage of GDP

Turkey’s recent shooting down of a Russian air force plane has raised serious concerns about a further escalation of the conflict in Syria. Liam Denning argues the conflict reflects the increasingly embattled position Russia faces as oil prices decline (I wouldn’t paint Turkey’s role as necessarily benevolent given its support for anti Kurdish forces in Syria):

“Two things flow from this. First, Syria may represent just one front in a many sided struggle by resource-dependent countries such as Russia to maintain their position in oil and gas markets that suddenly look more like actual competitive markets than they did just a few years ago as new supply has entered the scene. That, rather than a Turkish border dispute, is the central geopolitical drama affecting energy.”

We’re seeing privacy at the centre of debates around online advertising and state surveillance but Greg Ferenstein explains that the concept of privacy is a relatively new one. He explores the emergence of privacy and looks at how we’re likely to see it further evolve in years to come:

The History of Privacy

The Economist has produced a valuable interactive infographic (it’s worth visiting The Economist for the interactive version) allowing viewers to examine which countries are doing a better job of empowering women in the workplace. Britain seemingly doesn’t do well in any of the measures:

The glass-ceiling index

The US is often characterised as deeply religious which has an inevitable impact on national and ultimately international politics. Given this, it’s interesting to see Pew Research Center’s latest recent research into religion and faith pointing to the country becoming more secular:

How the U.S. public became less religious

The featured image is Pistache, Bleu Gris et Noir by eko.

Thought Starters: Content that has got me thinking 17

A lot of noise is being made about the rapid growth of ecommerce and the  effect this is having on bricks and mortar retail. Forrester analyst Sucharita Mulpuru provides an alternative view,  pointing to the continuing growth in the traditional retail sector and the need to distinguish between retailers making the right (and wrong) decisions.

Geoffrey Moore gives a rather sobering view on the effect that technology is having on America’s middle class and suggests some potential avenues to address this.

Marc Andreessen is interviewed in the Washington Post providing commentary on the impact of revelations on NSA surveillance, net neutrality and bitcoin. His commentary on the latter is particularly interesting and marks out why Andreessen Horowitz are investing heavily in the sector.

E-commerce would’ve gotten built on top of this, instead of getting built on top of the credit card network. We knew we were missing this; we just didn’t know what it was. There is no reason on earth for anybody to be on the Internet today to be typing in a credit card number to buy something. It’s insane, because — which is why you have all these security problems, the Target hack and all this crazy…. And these high fees, this high fraud rate. It doesn’t make sense online to have a payment mechanism that requires you to hand over your credentials to make a payment. That’s just an invitation to fraud and identity theft. It’s just stupid.

But we didn’t have the better way of doing it. So we didn’t know what else to do, and now we have the better way of doing it. Now, it’s going to take time. We’re quite confident that when we’re sitting here in 20 years, we’ll be talking about Bitcoin the way we talk about the Internet today. We just need time for it to play out.

Moving customers over to a subscription model of payments may provide companies with a valuable regular income stream but Brian S Hall points out that this is   not necessarily in the consumer’s best interests.

Timothy B Lee looks at the New York Times’s Innovation report which identifies new disruptive players, but also suggests that the organisation like many incumbents is poorly placed to meet the challenge of new entrants.

Game Oven recently wrote a piece looking at the difficulties in writing software for Android given the fragmented hardware and software environment. Benedict Evans built on this post , pointing to the problems of Android fragmentation but also suggesting that the movement to a more cloud based environment may alleviate many of the current problems associated with developing for Android.

Deloitte has released its latest Media Consumer report looking at changes in media consumption patterns in the UK. Among the areas covered are device ownership, television consumption, trust in journalism, use of social media, cinema viewing, gaming and streaming of music.

Percentage of households that have at least one of these devices

 Julie Ask looks at the role of disintermediaries in an increasingly mobile centred environment, with social media, mapping, entertainment, commerce and payments growing in strategic importance.

Today, a third crop of platforms are laying the groundwork to step into the powerful position of “owning the customer,” by serving them in mobile moments. Consumers expect to be able to get what they want in their immediate context and moment of need. They will reach for their phone for information and services. The issue is, most brands aren’’t yet there for their customers in this moment, challenged to even get customers to visit their mobile website or download the brand’s mobile app.

That’s where the platforms that dominate minutes of use, such as popular messaging and social media apps, come into play. It’s not hard to imagine a future where a small set of highly contextual and curated disintermediaries offer consumers a portal to the universe of services on mobile devices. Companies should consider the possibility of a future where their access to consumers is through this small set of disintermediaries

JWT Intelligence has a look at the mobile payments sector which is encumbered by the chicken and egg scenario. Consumers won’t use a service if they’re not familiar with it but retailers won’t invest in a platform if it’s not widely adopted. Efforts are being made to increase adoption and Apple is a potentially disruptive player waiting in the wings.

A growing amount of attention has been given to the mobile messaging sector lately, particularly in light of Facebook’s recent acquisition of WhatsApp. Line and WeChat are similar (provide text and photo messaging but different from the more traditional mobile messaging players  with Mark Bivens and Jerry Yang comparing the two Asian powerhouses on Bivens’ blog.

I am a strong believer that we will see some version of enhanced eyewear make inroads in the future  but Matt Lake’s review points to  Google Glass being some way from the medium’s end goal.

There’s been a lot of talk lately of a cooling in tablet sales with commentators suggesting that the smartphone can more than adequately fulfill many of the use cases. Providing a counterpoint to these suggestions is research from Flurry which point to growing usage by tablet owners.

Tablet usage

Matthew Yglesias looks critically at the content that Facebook looks to share among its users following Director of Product at Facebook’s recent rant about the state of the media.

Relationship status is one of those sensitive areas that users aren’t always willing to make public on Facebook. In an attempt to overcome consumers’ reluctance (and provide another data source), Facebook is providing consumers with the opportunity to directly ask fellow users what their current relationship status is.

Relationship Status

Facebook has added song and television show identification (à la Shazam) to its iOS and Android app, providing the opportunity to further enrich its collection of consumer data.

Facebook Music and TV Id

Whilst digital technologies such as HTML5 and WebGL are enabling a richer array of experiences online, the majority of online spend is still very much on direct response advertising in the US according to eMarketer figures.

Digital Ad Spending ShareThe featured image is Reliefs by Evgeniy Dikson

 

Thought Starters: Content that has got me thinking 14

The Next Web charts the inexorable rise of HTML5 as Flash becomes increasingly marginalised in a multi device world.

Jean-Louis Gassée looks at the role of the iPad as its growth slows and a role which is arguably stuck in the no mans land between smartphone and PC.

No longer charmingly simple, but not powerful enough for real productivity tasks. But if the iPad wants to cannibalize more of the PC market, it will have to remove a few walls.

Juan Pablo Vazquez Sampere argues that high-end disruption has a much lower chance of success than low-end disruption, and lays out some preconditions for where its more likely to be successful.

Drawing on the topic of disruption is Benedict Evans’ where he explores  situations where innovations and changes in market conditions enable ‘unfair’ competition.

An unfair comparison generally means an unfair advantage, and this isn’t the Olympics – unfair is good. Customers don’t care if a company’s advantage is unfair. Investors don’t care. Unfair advantages are often the best kind. 

Sameer Singh looks at the changes that Project Ara‘s modular view of smartphone could bring to the smartphone sector, providing a disruptive force within the smartphone market.

Project Ara scattered parts

Horace Dediu explores the concept of innovation, contrasting it with novelty, creation and invention.

The Atlantic explores changes to employment in the American retail sector which is being turned on its head by the movement to large format retail stores and the growth of ecommerce.

For consumers, there’s never been a better time to buy stuff. It’s not such a happy story for the people on the shopping floor and behind the counters.

Simply Business provides an interactive infographic looking at Apple, Amazon, Google, Yahoo and Facebook’s acquisitions over the the last ten years.

Hungry Tech Giants

Needing to polish up your social media guidelines? The UK’s Government Digital Service has just released their Social Media Playbook, which should make a good starting point.

Robert Newman in conjunction with other commentators looks at the mixed performance of app based digital magazines and the opportunities provided by digital magazines in the future.

Mindy McAdams explores emerging forms of digital journalism online, that includes reference to examples from the Council on Foreign RelationsDigital First Media, NPR and National Geographic.

Whilst we are on the subject of digital journalism, it is worth exploring Bloomberg’s How Americans Die which uses interactive infographics to explore mortality and its causes in the USA.

How Americans Die

Vision Critical and Crowd Companies infographic looking at the collaborative economy. You can find more detailed coverage in their report Sharing is the New Buying.

A Taxonomy of the Collaborative EconomyDavid Hepworth argues that the power is shifting from content creators to digital distribution platforms in the news, music and entertainment industry.

In responding to this traditional media owners are having to recognise that content in itself is not enough.

GfK looks at the newspaper industries exploration of different strategic options as audiences move increasingly online. The Blizzard, The Sun and the Financial Times are held up as interesting examples of brands adapting to new environments.

Angus Steakhouses are seemingly imprevious to London’s culinary renaissance. The Independent explores their continuing success despite the increasingly refined tastes of London residents.

George & Jonathan provide a data visualisation of a different kind, bringing their music to life.

George & jonathanThe featured image is a Stohead mural in Linz, Austria found on StreetArtNews.

 

THOUGHT STARTERS: CONTENT THAT HAS GOT ME THINKING 10

The following provides a roundup of some of the articles, thought pieces and content which have got me thinking recently.

I still require some convincing on whether Facebook’s acquisition of WhatsApp makes financial sense. There has been a lot of talk of how WhatsApp will retain much of its management independence and will honour existing privacy arrangements including not collecting user data for advertising. These restrictions will hamstring the service’s utility for Facebook, but the service’s astonishing growth may make the question moot as these figures from Om Malik suggest.

mau-vs-age-final

The Flurry Blog looks at the growth of Android personalisation apps such as Facebook Home and Yahoo’s Aviate as being the next mobile battleground. Rapid growth, albeit off a small base and an interesting counterpoint to the growing attention to mobile messaging.

Growth in Peronalization Apps for Android-resized-600

Casey Research takes a critical view on Bitcoin, pointing out that the system is only as strong as its weakest link with a shortage of security and trust likely to encumber the currency  for the  time being.

Marc Andreessen provides some of the more intelligent commentary on the technology sector and his forecast for the media sector definitely provides food for thought.  As a counterpoint, the Columbia Journalism Review takes a less rosy view of the disruption technology is bringing to the sector.

The Wall Street Journal points to the continuing dominance of bricks and mortar in America’s retail sector – Amazon (and other eCommerce operators) still has plenty of opportunity to take a greater share of the pie.

Bricks and Mortar Retail

Microco.sm has publicly launched its online forum offering,  providing some much needed competition to Vanilla, vBulletin and Invision PB. It’s worth adding that despite all the talk of social media channels such as Twitter and Facebook, forums retain an important role in enabling conversations with customers as profiled in research published in the Journal of Marketing Research and profiled in Convince & Convert.

The Government Digital Service (GDS) has done some great work making Britain’s public services more available online. The GDS‘ dashboard provides a valuable window into what devices consumers are using in the UK.

Activity on GOV>UK

The Financial Times looks at how automation is making growing inroads into white collar employment as software increasingly eats the world.

Technology- Rise of the replicants

Satellites are continuing to make images of Earth more and more available so its intriguing to see video now coming into play as Skybox’s offering comes online.

Most societies at least play lip service to the issue of social mobility, so its interesting to read Professor Gregory Clark’s research which points to mobility as being comparatively unaffected by social policy. We are better off addressing the results of inequality rather than expecting social reforms to enable the move from barrow boy to banker.

Evan Selinger in Wired looks critically at the launch of BroApp and suggests we might be outsourcing our humanity by relying on such tools.

The Wellcome Trust looks through its Mosaic website looks at the health benefits of cycling and what different cities are doing (or not doing) to encourage it.

Southwark Bridge, London by Sarah Maycock/Handsome Frank
Southwark Bridge, London by Sarah Maycock/Handsome Frank

The featured image is Caffarena 86 by Nelio from La Boca, Buenos Aires.

 

Trends to Watch: Mobile enabled shopping

I was asked to have a look at some of the trends that I feel are likely to have a considerable impact on the consumer landscape. This is the first in the series, drawing on my earlier presentation on mobile retail.

Mobile enabled shopping

The growth of smartphones has provided ecommerce operators with the opportunity to encroach on the space of bricks and mortar retailers with apps like Amazon’s Price Check providing a presence in physical stores as well as at consumers’ desktop. In the words of Street Fight, we’re moving towards the following environment:

“Discover anywhere, transact anywhere, and fulfil anywhere.”

But smartphones are also enabling bricks and mortar retailers to provide a more enriched instore experience for consumers. We saw the beginnings of this with the introduction of QR codes, enabling consumers to access product information, reviews and comparisons from their handset and expanding the selection of products beyond what is physically available instore.

The introduction of Bluetooth Low Energy (BLE) beacons has made the process of bringing information to the attention of consumers a whole lot easier, with information and alerts triggered by consumers’ location within the store after downloading the relevant app.

Smartphones are also offering to enrich loyalty and discounting campaigns, making the process of rewarding more tangible and providing offers to consumers that they can more readily take up.

Whilst we’re still to see the arrival of the much-touted mobile wallet, we have seen retailers begin to integrate payments into their own mobile apps, providing an additional means of purchase, which can prove particularly valuable for regular customers.

These initiatives provide retailers with a rich seam of data with which to better understand their audience and the opportunity to provide a more personalised response to consumers when combined with an effective data management strategy.

Macy’s & Shopkick: Making consumers feel welcome

Macy’s has partnered with Shopkick in the deployment of shopBeacon (BLE) transmitters. Consumers who have downloaded the Shopkick app will be welcomed by the app when entering participating branches and then shown location-specific deals, discounts, recommendations and rewards, without having to open the app.

Cartwheel by Target: Bringing discounting into the 21st Century

Target offers consumers the ability to browse for discounts online, add the offers to the Cartwheel mobile app (and share with friends via Facebook) and then redeem the offers at the checkout. Target must be doing something right as it came at as the most browsed retailer on mobile in the US.

Cartwheel by TargetKFC Fasttrack: Getting what you want asap

 KFC is piloting the Fasttrack app in the UK, enables consumers to place an order and get priority service when they arrive and check in at the participating branch. The app makes it easier to order by remembering favourite items and payment details.  For the participating branches, this has meant cutting down waiting and ordering time by 60-70%, sounds like a win-win situation.

KFC FastTrack

 

 

Taking a Mobile First Approach to Retail

I gave the following presentation recently on the application of Mobile First within a retail environment. You can find the accompanying text and references in the post below.

Slide 1: Cell Towers by Rebecca Rothfus

Slide 2:  There’s no escaping the fact that mobile is here as smartphone and tablet penetration increases.

Slide 3:  Mobile is now taking the lion’s share of growth in ecommerce sales with tablets performing strongly and sales from smartphones growing particularly fast.

Tipping point reached in e-Retail, as mobile now accounts for all online growth, IMRG, 2013,

Slide 4:  Whilst sales are on the increase, it’s also important to look at mobile as an important contributor to offline and online sales.

The growing influence of mobile in store, Deloitte, 2013,

Slide 5:  I’ve taken a broader view of mobile first, looking at how retailers can better enable their offering to mobile and tablet users. It’s important to note that the retail sector is not homogenous and different strategies are going to work better for different parts of the industry.

Slide 6:  Mobile and tablet devices are getting more and more capable, but their form factor provide some limitations. Among these are more limited keyboard, smaller screen size and less powerful process. This raises the need for a digital presence that’s built with these constraints in mind.

On top of this, further impetus is driven by Google’s search optimisation policy which is penalising websites with slow mobile load times.

2014: the mobile SEO timebomb, Econsultancy, 2013

Slide 7:  Despite mobile device’s technical limitations, consumers expect their mobile devices to deliver a similar level of performance to their desktop equivalent.

The World Has Gone Multi-Screen, Google, 2013

Slide 8: The different formats of mobiles, tablets and PCs provide different optimum use cases.

The mobile screen is great for snack sized content. Tablet screen is a more lean back medium which is great for consuming media. PCs on the other hand are often described as lean forward medium where the user is better orientated to interacting with the content.

But for mobile devices, it’s not all about limitations as they’re increasingly loaded with a range of sensors which give them capabilities not provided by your PC.

There is a real need for digital resources to be designed in a way that reflects these differences. 

From Smartphones to Tablets – The Changing Landscape, immobi, 2013

Slide 9:  Mobile First asks designers to ensure that their designs will work within these constraints and not simply provide a lesser experience.

This has seen the growth of adaptive and responsive web design and…

Slide 10:  The emergence of card based user design formats, all of which look to adapt readily to the different devices form factors.

Designing for mobile use also means legible typography, content that renders in both portrait and landscape, concise content, avoidance of plugins such as Flash, click to call functionality and the minimising of user text input.

Why cards are the future of the web, Intercom,

Slide 11:  It’s also important to remember it’s not simply about the visual appearance but also ensuring that consumers have an easy way to navigate to where they want. This means a user experience designed for navigating by touch and meta data designed to enable the mobile searcher to quickly get from A to B.

The Mobile Playbook, Google, 2013

Slide 12:  The constraints of mobile mobile devices also make payments more difficult than on your typical PC. So it’s well worth giving thought to services such as Amazon Payments and Paypal which reduce the obstacles to purchase for mobile users.

We’re also beginning to see new models of payments emerge with initiatives such as Starbucks’ Tweet a Coffee and the use of mobile messaging platforms to make payments.

The future of mobile payments, Medium,

2014: the year of ‘Buy with Google’? Econsultancy

Hugo Barra, Vice President, Xiaomi Global & Loic Le Meur, LeWeb, 2013

Social commerce, the influence of China and other tech trends for Southeast Asia in 2014, TheNextWeb,

Slide 13:  It’s also important to consider native apps. These typically enable a great degree of personalisation, can make better use of phones’ native functionality, can be used offline and are typically quicker to start up.

Ocado on the Go, Ocado

Slide 14:  Mobile apps also provide a means of getting consumers to engage with your brand outside of just the purchase process. Content that informs and or entertains has the opportunity to put multiple shop windows in front of the consumer. Examples of these include Tesco’s meal planner or for a more light hearted approach, American retailer Home Depot’s mobile game.

It’s important to stress given the increasingly crowded nature of the app ecosystem, you cannot adopt a build and they will come approach.

Tesco Food, iTunes,

Corso’s Cornhole Challenge, Home Depot, iTunes,

Home Depot tackles mobile gaming to score sales, Mobile Commerce Daily,

Slide 15:  Consumers are faced with an endless array of choices, so the content needs to be compelling and the app needs to work well or consumers will simply go elsewhere.

Any mobile app developed needs to be promoted as it’s rare for a resource to go viral without a bit of a foot up.

Mobile app based strategy is not without its hurdles given that development is platform specific leading to the exclusion of users on other platforms. 

As an example, Android has the greater penetration in the UK but research points to iOS users making greater use of their devices’ functionality including spending more online. There’s also evidence that points to different audience profiles for the different mobile platforms.

Finally, Android has a more fragmented environment with a much wider range of devices and operating systems complicating any app roll out.

Android and iOS Demographics In The US, AVC, 2013,

Alert: Mobile Traffic and Sales Surge on Christmas Day 2013, IBM, 2013

Building Android first, Kidogo,

App Store Distribution, Apple,

Dashboards, Android,

The horrible state of Android fragmentation, iDownloadBlog,

Slide 17:  Whilst the majority of social networks function on PCs, it’s often on mobiles and tablets where they come into their own, particularly when it comes to the sharing of content and it’s on these devices we’re seeing the strongest growth.

Mobile users are nearly twice as likely to share content on social networks as desktop users, Social Media Marketing: The ROI is not MIA, Mobile Marketing Watch, 2013

Facebook’s Monthly Active Users Up 23% to 1.11B; Daily Users Up 26% To 665M; Mobile MAUs Up 54% To 751M, TechCrunch, 2013,

Slide 18:  This raises the need to optimise social channels for mobile users.

Whilst many of the principles remain the same as for desktop, there is even greater emphasis on brevity of content and the use of strong imagery to catch the eye of users.

Mobile users are nearly twice as likely to share content on social networks as desktop users, Social Media Marketing: The ROI is not MIA, Mobile Marketing Watch, 2013

UK retailers make a splash on Twitter as Christmas nears, Twitter Advertising Blog, 2013,

See yourself in Times Sq. on #NYE! Twitter, https://twitter.com/MasterCard/status/416657951428857856

What You Need To Know About Facebook Mobile Ads, Entrepreneur, 2013,

Slide 19:  Instagram, Vine and Snapchat are all built on Mobile First principles and provide great opportunities to reach consumers in a way that takes the best advantage of the limited screen space of the mobile phone with paid and earned media campaigns.

Are mobile social ads overhyped? Mobile Marketer, 2013

Co-op claims retail ‘first’ with Snapchat campaign, Marketing, 2013

Nordstrom: Vine on Vine, Brands on Vine, 2013

Slide 20:  Pinterest has been a powerful generator of retail traffic with the platform offering a strong mobile presence. Driving traffic to Pinterest provides a great means of increasing consumer engagement with retailer’s brand and potentially to purchase. 

It’s also important to consider other opportunities in the social space with Polyvore in particular standing out with its ability to generate sales traffic.

Mobile users are nearly twice as likely to share content on social networks as desktop users, Social Media Marketing: The ROI is not MIA, Mobile Marketing Watch, 2013

One social network you’ve never heard of drives 20% of all social commerce, VentureBeat, 2013 ,

New iPad and iPhone Updates: Collections, Shop on iPad and More, Polyvore Blog,

Slide 22:  Despite the growing penetration of mobile and tablets, the media world has still to adjust their spend to reflect this change. 

At a basic level, adding the use of mobile media in conjunction with traditional advertising brings an incremental lift in marketing campaigns.

Study: Mobile Video Ads Complement TV Campaigns, AdColony, 2012

Slide 23:  But where the concept of cross media activity really comes into its own is where different media are used together, increasing consumers’ engagement with the message.

The World Has Gone Multi-Screen, Google, 2013,

Slide 24:  A good example of this is the use of augmented reality apps, bringing traditional static media to life and providing a response channel for consumers.

Tesco Homeplus ‘Virtual Supermarket’, Streething, 2011,

Layar Creator brings interactive augmented reality to print media, The Verge, 2012,

Track My Macca, Protein, 2013

Slide 25:  We are also seeing the integration of mobile functionality into television advertising that goes well beyond simply providing a URL or hashtag.

Twitter now provides the opportunity to target advertising at Twitter users who have identified themselves as watching a particular programme, Kia is asking users to play tennis against their television and mobile app Shazam is being used as a response channel for viewers. We’re likely to see a whole lot more of these initiatives going forward.

TV conversation targeting launches in the UK and US: Coming soon to Brazil, Canada, France, and Spain, Twitter Advertising Blog, 2013,

Kia Game On Tennis, Google Play,

Expedia drives mobile bookings via TV campaign, trip-a-day giveaway, Mobile Commerce Daily, 2013,

Slide 26:  Where it gets really exciting is when different digital screens are combined creating an altogether richer interactive experience. Google has been doing this with its Chrome Experiments, and Orange had a go at it with it’s Hello 2014 campaign that ran over New Year’s Eve.

This multiscreening approach offers real potential but doesn’t come without its own problems.

The varied nature of mobile devices brings technical challenges, although the rise of HTML5, WebGL and other technologies are proving important enablers. More generally, different media platforms have been developed on different principles and cross media platforms are requiring the development of common frameworks.

hello 2014, Orange,

Orange Rings in the New Year with a Dual-Screen Experience, Counsel, 2014

Slide 27:  One of the key differentiators of mobile is its portability, raising place as an important variable. Location based services provide retailers with the opportunity to help get consumers into physical stores and keep them returning.

To put this in perspective 57% of smartphone users look for information at least once a week and 25% of smartphone users look for information daily.

Google statistics quoted in Optimizing Your Local Presence for Mobile Search (and vice versa!), Distilled, 2013

Slide 28:  Retailers need to ensure their physical stores are findable, with locations in online map services, retailers own mobile properties and location based services such as Fourquare and Facebook Mobile.

Attract new customers with local ads on the Google Maps app, Inside AdWords, 2013,

Tesco Groceries, iTunes,

 Slide 29:  Building on the earlier location based services is the finding of products, services and information instore using third party resources such as Google maps or via owned media.

Let indoor Google Maps be your guide this holiday shopping season, Google Maps, 2012,

Lowe’s personalizes mobile shopping via in-store app features, Mobile Commerce Daily, 2013

Slide 30:  It’s also worth encouraging customers to check in via Foursquare and Facebook, providing the retailer with free publicity across the consumer’s social networks.

Location based marketing is seen by many as a godsend, offering the opportunity to reach consumers when it takes them the least effort to purchase. The problem is that close proximity alone is not necessarily a good indicator of whether the consumer would make a good prospect. The best results come when location is paired with other variables to give a robust means of targeting consumers. We also need to be acutely aware of overloading consumers with marketing messages which could lead to their abandonment of this channel.

Powerful yet simple to use, Foursquare for Business,

Slide 32:  Mobile is coming to play a significant role in the instore retail environment.

The growing influence of mobile in store, Deloitte, 2013,

Slide 33:  Mobile apps like Amazon’s Price Check have raised the spectre of showrooming, as ecommerce operators aim to turn bricks and mortar shops into the display stands for their own operations.

And there is plenty of evidence to support consumers using their mobiles to check prices.

The Mobile Playbook, Google, 2013

Slide 34:  But international research by the Columbia Business School points to consumers engaging in a broad range of activities instore and it’s not simply a case of try there and buy elsewhere.

Showrooming and the Rise of the Mobile-Assisted Shopper, Columbia Business School, 2013,

Slide 35:  The use of instore maps provides a means of getting consumers to your goods and services, but where smartphones really come into their own is enriching the retail environment. This has traditionally required the sometimes clumsy process of scanning QR codes but NFC and Bluetooth Low Engery Beacons are providing a more seamless experience for mobile users.

This provides smartphone users with the opportunity to find out further information about the store and its products and services. Like an Amazon user, an instore shopper has the potential to pull down consumer and expert reviews, product demonstration videos and comparisons whilst keeping within the retailers’s digital and physical environment.

Apple’s iBeacon and NFC, DigitalLab, 2013,

Slide 36: We are also seeing smartphones used to deliver offers, promotions and rewards. A lot of noise is currently being made about the introduction of beacon based programmes enabling users to receive location specific deals, discounts and recommendations.

What is shopBeacon?   shopkick

Cartwheel by Target, Target

Macy’s Dips Toes in Brave New Marketing World, TechNewsWorld, 2013

Slide 37:  Mobile payments is another area we are seeing a significant change, offering consumers an easier way to purchase instore whilst avoiding unnecessary queues.

There are a range of solutions currently on offer, with mobile payment providers such as Google Wallet, Paypal, Masterpass and Square but it’s in the area of retailer specific solutions that we’re seeing the greatest success.

When considering mobile payments and beacon based initiatives, it’s also important to think about how any instore promotions will be integrated with retailer’s loyalty programmes and discounting campaigns which are also increasingly mobile enabled.

Like the use of instore beacons, mobile payments is very much a nascent field in which we’re seeing a rapid evolution of best practice.

Apple Store, iTunes,

KFC’s Mobile Shopping App sees 90pc of users placing orders via mobile, Mobile Commerce Daily, 2013,

KFC Fasttrack, iTunes

Walmart, iTunes,

2014: the year of ‘Buy with Google’? Econsultancy, 2014

I’m Still Waiting for My Phone to Become My Wallet, New York Times, 2013

Target leverages Facebook to bolster downloads for new mobile deals app, Mobile Commerce Daily, 2013

Slide 39:  The above quote comes from the New York Times paints a rather unwelcoming picture for the bricks and mortar retailer, but it’s not all bad. Mobile has the real potential to strengthen the hands of retailers with a physical presence. A more positive note was recently sung by IBM who have touted buying local as one of the key forecasted trends over the next five years driven by the opportunities of a more digital enriched shopping experience.

eBay’s Strategy for Taking On Amazon, New York Times, 2013

Buying local will beat online, IBM, 2013