Google I/O Recap: Google Rises To The Virtual Agent Challenge

Google took a few big steps forward at Google I/O 2016 to fill in its portfolio to win, serve and retain customers in their mobile moments. Three new product announcements should propel Google forward. They include:

  1. Google Home. Google Home looks like an incredibly promising (and necessary) entry into the home virtual assistant or agent hardware market. Like Amazon, Google led with a story of entertainment and media followed by that of virtual assistance. Google claims the combination of natural language processing, artificial intelligence and years of experience with consumer inquiry patterns via Search will push it beyond the competition. Google’s entry validates the space and its vision to sit between the consumers and their favorite brands. However, Google also failed to offer answers to questions such as a firm date on availability, price or access to the service – how open will access be for brands who want to engage their consumers on Google Home?
  2. Allo. Allo is late to the instant messaging game, but on time for the bot frenzy. Brands are exploring bots that offer customer service or support and help them sell products and services. Google will launch Allo this summer with a host of well-known brands such as OpenTable, Uber and GrubHub. Like Facebook -- and despite a dependence on advertising revenue -- Google did not announce any opportunities specific to marketers for advertising or broad consumer engagement. Google will still facilitate consumers getting reservations or finding concert tickets – sitting between the brand and the consumer. The strategy is both expected and smart.
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Smart Watches Need (More) Killer Applications

Smart watches are not a must-have device – yet. The novelty of the device – combined with early adopters eager to have the next great thing – has carried smart watches from an obscure idea to a well-known device, but neither critical mass nor mass market adoption. So what’s missing?

Smart watches or similar wearables will hit critical mass (20%) and then mass market adoption (> 50%) only once consumers adopt these five applications:

1.     Notifications. Among consumers surveyed by Forrester, 40% are tired of pulling their phones out of their pockets or purses. Moreover, according to a study conducted by Mary Meeker from Kleiner Perkins, more than 60-70% of consumers’ mobile moments are simply a quick glance at their devices to get information they need to make a decision or take action. Notifications could range from a sports score to a reminder to pay a bill. Smartphones and apps are overkill for these interactions or mobile moments.

2.     Payments. Mobile payment solutions from companies like Apple, Google, and Samsung, among others, are game-changing. The combination of near-field communication (NFC) and payments drove adoption of the current generation of smartphone upgrades. Mobile payments remove friction from the payment process both online and in-person. For example, I use my Apple Wallet so often that it took me six weeks to realize that my ATM card had expired.

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Facebook F8: Important Takeaways For Digital Business Pros (Hint: Keep Calm About Bots!)

Facebook held its annual developer conference in San Francisco this week. Analysts at Forrester collectively fielded a lot of questions from the media, but most of them focused on bots and the Messenger platform. Here are my top takeaways from the event:

  1. It's still early days for developer tools: Facebook approached F8 with a humble, honest tone and message about the state of its applications, platforms and tools for developers. Facebook didn't over promise. Every executive on the main stage to the breakouts in the "Hacker X" and "Hacker Y" pavilions offered an honest portrayal of where Facebook is today. Where is it? Facebook holds a very strong position in terms of total minutes of use and monthly active users across its various apps and platforms (e.g., Facebook, Whatsapp, Instagram, Facebook Messenger, Oculus, etc.), but they are just beginning to offer tools to developers. Developers of mobile apps want to borrow mobile moments on Facebook's apps/platforms because they don't own enough mobile moments themselves. Facebook is just in the earliest of stages of giving tools to these developers to help them borrow mobile moments effectively.
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Bots: The Next Big Thing In Mobile? Not So Fast.

Everyone is buzzing this week about bots with Facebook/Messenger’s anticipated launch of bots on its messenger platform. What is a bot you ask? A bot is a chat-based interface that helps consumers complete tasks -- ordering take-out food, chatting with their doctors, or checking the score of a big sports game. Many believe that this next step -- bots in conversation with consumers -- is imminent. We agree, but not so fast.

There are a few trends playing in favor of bots becoming the next big user interface:

  1. Apps put a huge burden on consumers. The app ecosystem forces consumers to orchestrate getting the content and services that they need -- sometimes in a single app, most times through a composition of many. And this doesn’t even address individual app quality -- too many of them are simply awful. We're forced through processes translated from online that make no sense on the go or on our mobile phones.
  2. Bots foster natural communication. Having a bot is like having an assistant. You can chat with the bot, ask the bot to do things for you -- like order take-out or get a new lipstick. They are a natural extension of how we communicate and use our mobile phones.
  3. Consumers spend 84% of their time in just five apps each month. Chances are that one or two of those are social media, instant messaging,etc., as a handful of mobile giants like Facebook, Google and Apple in the US own a disproportionate number of customers mobile moments, measured both by time and data. Consumers are asking for a better experience.
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Yahoo’s Challenge: Mobile. Yahoo’s Answer: China.

Yahoo’s board met yesterday amidst disappointing financial results that have failed to live up to the expectations of its investors. Prevailing rumors suggest that the board under pressure from investors will vote to break apart the business and sell the pieces.

While it is true that the majority of Yahoo’s revenue comes from online advertising, the future is clearly mobile. Mobile phone numbers are more important than email addresses, and consumers already use their mobile phones more than two hours a day in the U.S. Global expansion depends on mobile.

Power in mobile depends on two core factors: audience and data. Here’s why.

Audience will draw in developers, advertisers and service providers. Today in mobile, audience depends on a strong presence in social networking, instant messaging, and media (e.g., video, music, games, news and books).

Data is the context that drives the value of the audience. The more context brands have about consumers to offer them insights about needs and motivations, the better brands can win, serve and retain those customers in their mobile moments. Winning in data includes access to email, browser, maps, search, wallet, commerce, health, fitness, home and automotive data - as a start. Those who own the mobile OS (e.g., Apple, Google and Microsoft in the U.S.) own the trump card in data.

Simply put, despite a host of strategic mobile acquisitions (e.g., social media, mobile analytics) and new talent, Yahoo! is still too small. It lacks the scale of Facebook or Google. This makes Yahoo a good partner, but not the booming, independent success that each of these businesses has become.

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2016 Predictions: Key Trends Will Transform Mobile Engagement

2016 will be the most consequential year for companies on the path to customer obsession, and that includes adapting to empowered customers who expect to get anything they want immediately, in context on their mobile devices.  Today that represents nearly 50% of consumers in the U.S. alone. The consumers pick up their mobile devices 150 to 200 times a day. In aggregate, that adds up to nearly 30 billion mobile moments each day. These mobile moments are the next battleground where companies will win, serve and retain their customers. Tragically, few companies will make the leap. Those that do will reap the rewards.

 

What role does mobile play in customer obsession, and how can businesses leapfrog their competition to deliver superior customer experiences? Here are three ways Forrester predicts mobile will change the ways business leaders operate in 2016.

 

1. Mobile will act as a catalyst to transform businesses in the Age of the Customer.

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Where Would The Wearables Market Be Without Smartphones?

Few consumers categories have seen the explosive adoption that wearables have - especially fitness wearables.The category has gone from zero to tens of millions in sales in less than five years.

Without smartphones, however, the wearables market is likely nothing more than a fad for devoted athletes and passionate (or overzealous) weekend warriors. Smartphones have fueled growth in two core ways:

  • Mass adoption of smartphones made the components cheap.
  • Apps allowed for and created the engagement (e.g., gamification, competition, support, coaching) consumers need to meet their goals.
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How Will You Communicate With Your Customers If They Don't Read Email?

Your customers are inundated with messages every day from friends or family, work colleagues, and marketers among others. Notifications from their banks, news organizations and fitness bands also land on their mobile phones. Let me show you the home screen of my iPhone.

A summary of my communication (or lack thereof) shows:

  • 24,998 unread personal emails (okay, mostly from marketers)
  • 4,937 unopened work emails
  • 272 unopened SMS messages
  • 45 unopened/read messages on WeChat (these are from marketers)
  • 0 unread notifications from Facebook (and I average 23 per day)
  • 0 unread notifications from Slack (and I average 87 per day)

 

 

I still use all of these communication channels, but I pay more attention to some of the channels than to others.

Here’s what is happening:

  1. My email inbox has been overrun by emails I no longer read or want.
  2. I continue to download new communication applications. Each time I do so, I am very selective about who I add into my new circle.
  3. I pay most attention to those applications that offer value to me in the form of entertainment or as in the case of Slack, collaboration with a very small group of trusted colleagues. These messages are extremely relevant to me – and personal.
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Fitbit IPO: The Road Ahead

Fitbit made its S1 filing coming off a quarter of astounding growth: $336.8M in revenue – up from $108.8M in Q1 2014. The enterprise generated $48M in net income. Last week we learned it hopes to raise $100M through an IPO. Why would Fitbit IPO now?

There are any number of traditional reasons - raise capital, return money to investors, etc. But what is interesting to debate, however, is the timing of Fitbit’s IPO. Fitbit may have chosen to IPO now so it can:

  • Draft off Apple’s wave. Fitness bands and smart watches have been on the market for years, but sales have been limited – especially for smart watches. Apple’s entry and marketing spend will drive awareness of the category from early adopters on the west coast to mainstream consumers. The tide will lift all boats, as the saying goes.
  • Raise capital at a possible peak. The smart watch may kill off or stymy the growth of lower end fitness bands. The cameras on early mobile phones were not as good as the digital point and shoot cameras or SLR’s owned by consumers, but a camera on hand is better than the one at home in a drawer or closet. The pedometer and sensors on a smart watch may not measure activity with the same precision as a dedicated device, but it may be good enough for many consumers.
  • Take advantage of a market with few IPO candidates. Few small companies will mature enough – let alone show the financial strength – to take their companies public. Many entrepreneurs are building services that make great features rather than great businesses. Their exit strategy is to sell to a Google, Facebook, Salesforce.com, IBM, Oracle, Microsoft, or SAP.
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Why Would Alibaba Invest In Snapchat?

The move shouldn't surprise anyone.  Remember Rakuten and Viber? Retailers need to expand their reach to acquire more customers. The more contextual the better. The investment is small relative to Snapchat's valuation and Alibaba's worth. I would view it more as an option to make a future, larger play than a clear indication of a new strategy. 

Two things matter the most in mobile:

1) Audience. Snapchat offers a new audience to Alibaba - one in the US and one that is described as being younger. Consumers spend more time in communication and social media apps than in retailing apps - in aggregate. Accessing consumers - marketing to consumers, letting consumers engage with brands or letting them make purchases where they already spend their time is an important strategy for brands looking to engage consumers on mobile devices - we call this "borrowing mobile moments." Alibaba's recent moves including products, acquisitions and investments clearly signal that they intend to make a strong play in mobile. They acquired a mobile OS player a few weeks back. An investment in Snapchat is another strategic asset. 

2) Data. Insights generated from mobile, social, sensor- etc. data will fuel the next generation of mobile experiences. This data will also give retailers insights into the needs and motivations of their consumers - especially in real time, on the go, what is trending. Consumers love flash sales, for example. 

Neither the valuations nor the velocity of deals should surprise anyone. Mobile phones are more akin to islands with limited (valuable) real estate than ever-expanding universes. Smart players like Google, Facebook, Amazon, Apple and Alibaba know this. Expect the trend to continue.