The past few weeks have involved travel to a few different events, ranging from eTail Latin America in Miami to Internet Retailer Conference & Expo in Chicago to the Goldman Sachs dotCommerce Day in New York. Rather than summarize the events, all of which were incredibly valuable, I wanted to highlight some themes from conversations I had at these events with brands looking to expand into new markets.
Leading global brands are increasingly aware they need to vary their approach globally. A common assertion in articles about localization is that companies erroneously view Europe or Asia as “one country” and fail to take into account key differences between countries. My experience is that global brands have largely moved beyond this phase: The brands I spoke with are keenly aware that each market is different, and are anxious to understand how they’ll need to adapt their online offering. They may not understand all of the differences inherent in each market, but they know — or are learning — the right questions to ask. The challenge for brands is understanding which parts of their offering really need to change to meet local expectations (and therefore merit the investment required to make the shift) and which offerings will still resonate even if they differ from those provided by local players.
Maps are only growing in importance as they become the primary portal on mobile phones for a growing list of information and services. As Apple showed us last year, it's critical to own maps - and to do maps well, particularly as a growing percentage of time is spent discovering, accessing, and engaging content within maps. With that said, it's not immediately clear to me what justifies a $1B+ (reported) price tag for Google’s acquisition of Waze, but I'll assume they did great due diligence or offered a high price to get a deal done.
For instance, many companies do acquisitions for audience, but Google's audience - even just on Android or Google Maps is substantial. Waze's website says 30M users; other sources say 50M. Apparently, engagement among users is high ... but is it well distributed? Are there enough active users in each market for the same excellent experience?
However, Waze does add new features that Google Maps doesn't already have e.g., the ability of users to report traffic issues, police cameras, broken down vehicles - you name it. Layering user-generated content into maps in real time in a way that makes sense and is useful to everyone at that place at that moment is not typical. Mobile needs to be highly contextual in ways people are beginning to understand, but are really struggling to implement well. It also increases speed to market if Google/Android team were otherwise developing this on their own.
With maps integrated into every retail, travel, banking, insurance, (ok go down the list) app on your phone, I don’t think any company can have too much map technology, or too many engineers/developers for maps and navigation technology.
Coca-Cola recently announced that it is jumping into the red-hot Indian online retail arena by selling directly to consumers and small businesses, a first for a FMCG (CPG) company in India. While the Indian online retail story is still being written and Forrester is bullish about the long-term prospects for this channel, the immediate challenges need to be managed effectively.
Logistics and fulfillment are the largest challenges of them all in India, with more than half of all online retail sales being done using cash on delivery (COD). While COD is essential in a nascent eCommerce market, it can have a large negative impact on business margins. This is exacerbated in a nascent market where consumers are testing this new medium of ordering goods, as the return rates can be quite high. In India, reportedly, the return rates can vary from 5% to more than 25%, depending on the category, the demographics of the online buyers, and their online tenure (experience with the Internet).
We’ve seen significant investment from US retailers in this space. Lowes, Home Depot, Nordstrom, and others have all been spending heavily on developing the underlying infrastructures that they can then leverage to create in-store digital experiences. Store Wi-Fi, associate devices like tablets or smartphones, kiosk technology, and even more emerging technologies like ePaper signage and electronic shelf-edge labels are on some agendas. Even Amtrak is getting in on the act with its eTicketing initiative.
After repeated false starts of trying to build its way into the enterprise eCommerce space, SAP has finally decided to do a U-turn on its strategy and buy its way in. For years there has been intense speculation that SAP might acquire hybris, and behind the scenes there has certainly been much umming and ahing over the enterprise software giant’s commerce strategy. Hybris has been on a tear recently, and until today was widely expected to file for an IPO in 2014; however, the firm’s destiny has for some time been in the hands of its VC investors (Huntsman Gay Global Capital, Meritech Capital Partners and Greylock Israel). The decision to sell to SAP was likely influenced by these VC firms who, between them, have a controlling state in the firm. The value of the acquisition has not been disclosed, but given hybris’ strong earnings over the past four quarters (the bulk of which was directly from license revenues) and with the looming path of an IPO, we can speculate that SAP paid a substantial price tag — although the terms of the transaction are likely complicated.
So the big surprise is not why, but why now? There is no single answer to this question — but we can look at the factors that have increasingly piled on the pressure for SAP to change direction and pull the trigger on this acquisition:
I am incredibly excited to announce that Ken Calhoon joins Forrester today in our eBusiness consulting practice. Ken has a fantastic background working with different organizations expanding internationally: Most recently he ran his own consulting firm focused on global expansion; prior to that, he spent seven years at eBay in different positions including VP, International Headquarters and VP, International Trust and Safety.
The video is called "Field Trip" and shows off some of the features of Google's Field Trip app. It's a short, but extremely compelling video that shows how mobile can be used to personalize your world - whether it is a wander about the bay area (this video) or your childhood home. You can consume someone else's story or tell your own story. Not to be creepy and it isn't Halloween, but what if you could use augmented reality - digital overlay of content triggered by location or recognizing an object/symbol - of grave stones? Visiting a cemetary could be SO cool. Visting your apparel shop, grocery store, airport lounge, restaurant, bank branch, healthcare clinic could also be cool IF you use your imagination.
Google's Ingress game layers both content and a game onto the physical world. (watch the video)
What's in it for the eBusiness professional?
I'm not necessarily suggesting a scavenger hunt in your store. Ingress + Hint Water did pull this off - not a hunt, but what is a game that combines digital with the physical world as a game board? I remember when Starbucks ran a scavenger hunt that started with a SMS-based trivia game more than five years ago. It was a huge hit.
I'm traveling to Atlanta next week. Today - Friday - I decided late in the day to book a hotel room finally.
I'm sitting at my desk. I'm figuring there will be some time on hold. I'm multi-tasking ... so I use my PC to do a quick search, find some nearby hotels and get a couple of phone numbers. I'll use my office phone with a headset and my hands will still be free to edit a document.
I start with brand A. I place the first call and talk to an idiotic IVR that puts me into a doom loop. I hang up. I call back and get a person. The person can't book a discounted rate so gives me another phone number to write down. I write it down. I throw it in the trash.
I shift to brand B. I place the call to the hotel. A man answers. He transfers me to an IVR asking for my home phone number. I don't understand. I hang up. I call back. The same man answers. I said, "I think there must have been a mistake. I thought you placed me on hold, but I got dropped into an IVR." Man replies, "oh no - that IS our reservation system." I reply, "you don't have people making reservations." He replies, "No - just the hotel reservation system - the IVR." I reply, "I don't make reservations with IVR's." I hang up. (Sorry - but it's insanely tedious - at least in this case ... my home phone number??? C'mon - they don't need that to book my room)
I pick up my phone and click on my "hotel icon" to open the app. Within 2 minutes, I've booked a hotel - all of my information stored - and spent $750.
The SF 49ers will soon have a new stadium in Santa Clara, CA. This May 30th article from the SF Examiner describes the new stadium as "entirely cashless and ticketless." The assumption is that "... the fans will be carrying around smartphones." "Software engineers are already building apps to order food, watch instant replays, listen to play-by-play and check bathroom lines from the seats."
As a mobile analyst, I love the concept. Has anyone every been to a conference though with thousands or tens of thousands or 68,500 people? How's your Internet connection?