MARKETING 7546 – TREND ASSESSMENT IICloud Computing andWhat It Means for DigitalMarketingGayatri Seshadri4/10/2012
What is Cloud computing?Everyone is talking about “the cloud.” But what does it mean?Business applications are moving to the cloud. It’s not just a fad—the shift from traditionalsoftware models to the Internet has steadily gained momentum over the last 10 years. Lookingahead, the next decade of cloud computing promises new ways to collaborate everywhere,through mobile devices.Life before cloud computingTraditional business applications have always been very complicated and expensive. Theamount and variety of hardware and software required to run them are daunting. You need awhole team of experts to install, configure, test, run, secure, and update them.When you multiply this effort across dozens or hundreds of apps, it’s easy to see why thebiggest companies with the best IT departments aren’t getting the apps they need. Small andmid-sized businesses don’t stand a chance.Cloud computing: a better wayWith cloud computing, you eliminate those headaches because you’re not managing hardwareand software—that’s the responsibility of an experienced vendor like salesforce.com. Theshared infrastructure means it works like a utility: You only pay for what you need, upgradesare automatic, and scaling up or down is easy.Cloud-based apps can be up and running in days or weeks, and they cost less. With a cloud app,you just open a browser, log in, customize the app, and start using it.Businesses are running all kinds of apps in the cloud, like customer relationship management(CRM), HR, accounting, and much more. Some of the world’s largest companies moved theirapplications to the cloud with salesforce.com after rigorously testing the security and reliabilityof our infrastructure.As cloud computing grows in popularity, thousands of companies are simply rebranding theirnon-cloud products and services as “cloud computing.” Businesses have to always dig deeperwhen evaluating cloud offerings and keep in mind that if they have to buy and managehardware and software, they are not really looking at cloud computing but a false cloud.Mobility and collaborationThe latest innovations in cloud computing are making our business applications even moremobile and collaborative, similar to popular consumer apps like Facebook and Twitter. Asconsumers, we now expect that the information we care about will be pushed to us in realtime, and business applications in the cloud are heading in that direction as well. With Cloud,keeping up with your work is as easy as keeping up with your personal life on Facebook.
Impact to the World of Business:Cloud Computing may be the greatest gift to digital marketers as they (we) are now able tomarket and evangelize every part of the value chain that the customer would interactwith.What’s more, given the nature of an online environment, those same customers will besure to make use of their social circles and share their experience of each step of the process –digital marketers are then urged to listen to what is being said and feed this information backinto the business to further improve the processes and the experience of the user. Products and services are all commodities. It is the users experience that is going to differentiate business now and in the future. Cloud computing allows the user experience to be traced and tracked every step of the way for improvement.There are numerous areas of the business that are affected by utilizing a cloud computingsolution. End-users can self-serve – this means that a process no longer needs to be run manually by paid for staff; but rather by a client who can complete the process in their own time. No Location dependence – the service is on as long as an internet connection is available meaning that your business can transact at any hour. Flexible performance and load – the ability to scale both up and down as and when needed. Flexible pricing and contract terms – the ability of subscribers to buy services as they are needed and terminate them when they are not.
Case 1:Netflix made what looked like a peculiar choice: the DVD-by-mail Company decided thatover the next two years, it would move most of its Web technology — customer movie queues,search tools and the like — over to the computer servers of one of its chief rivals, Amazon.com. Kevin McEntee, vice president of engineering at Netflix, pointing, and Santosh Rau, cloud system manager. Netflix is using Amazon’s network, freeing it to focus on its movie businessAmazon, like Netflix, wants to deliver movies to people’s homes over the Internet. But theonline retailer, based in Seattle, has lately gained traction with a considerably more ambitiouseffort: the business of renting other companies the remote use of its technology infrastructureso they can run their computer operations. Kevin McEntee, Netflix’s vice president ofengineering, said Netflix switched in order to “focus our innovation around finding movies,rather than building larger and larger data centers.”Case 2: SunTrust Banks uses the Service Cloud from SalesForce.Having sales and service on thesame platform has been really beneficial to SunTrust because it gives then one view of theclients.Potential Applications in Other IndustriesCase 1: "Governments are increasingly recognizing that the adoption of cloud coulddramatically reduce the cost of delivering services to citizens," noted John Herhalt, KPMGsGlobal Chair, Government & Infrastructure. “In this era of government austerity, it seems clearthat cloud will quickly become a key tool for public sector cost reduction."Only 12 percent of government executives say that more than 10 percent of their agenciesoverall IT expenditures are allocated to cloud in 2011. By the end of 2012, this figure isanticipated to more than double to 28 percent.(6)Case 2: While the healthcare sector has long been an IT laggard, the industry appears to beembracing cloud computing comparably to many other sectors. Nearly one-third of healthcaresector decision makers said they are using cloud applications, and 73% said they are planning tomove more applications to the cloud, according to a recent report by Accenture.There are several key reasons why healthcare sector IT leaders are moving applications into thecloud, said Dadong Wan, a senior research scientist at Accenture studying digital health trends
and a co-author of the recent Accenture report examining cloud computing in healthcare. Manyof those reasons boil down to cost advantages and flexibility that cloud computing offers tohealthcare organizations.Summary of my Interview with Mr.Sai Mattancheril [CTO, Krikle Inc.]According to Mr. Mattancheril, cloud computing reduces the barriers for small businesses andstartups. His company developed an iPhone application called Krikle. Krikle is a virtual graffitiapplication which allows users to post messages which then get tagged to their location. Otherusers of Krikle can then view all messages in the context of that particular location using anaugmented reality layer on the iPhone camera. He believes that cloud computing services made it possible for his company to build this socialmedia mobile application. Google’s application development cloud platform, Google AppEngine (GAE), was used to deploy the server and database components for Krikle. GAE has nocost upfront and users get billed based on various factors such as bandwidth used storage etc.Mr. Mattancheril discussed how Cloud computing services will help more small and mid-sizedbusinesses take off by providing them with reliable and scalable solutions. It has become a‘start-up’ friendly model. Amazon actually calls itself an elastic cloud since its services can beused on an ‘as needed’ basis. Its cloud service solution can contract and expand as percustomer demand. He thinks that any business model that can accommodate a variable basedpricing structure based on usage – example health care and Ecommerce, will benefit from thismodel. Other industry examples would be companies that build technology games, movierental companies, music companies and social media technology providers. SLAs provided bysuch Cloud Computing companies include convenient activity based pricing models and this willpromote the growth of small and mid-size companies from both the technology and thebusiness standpoint.Doubts still exist with this solution when it comes to risk and security. Now companies such asSalesForce have established a brand for themselves in the corporate world. So its just a matterof time for Cloud Computing to become a norm in the business world. Mr. Mattancheril statesthat like any new technology this will take time. Broadly, companies using cloud computing willincrease in the near future. He specifically points out to health care industry that will move tothis model to get their data standardized and regulated.Companies have to improve and address concerns related to security and demonstrate highuptime to gain consumer confidence. In closing, he believes that ‘the one view of the data’ thatthis solution provides will help businesses provide the best customer experience that theystrive for in today’s business world. Technology, sales and marketing arms in any givencompany independent of size will be working out of the same knowledge base to make the bestbusiness decision for their respective companies. Response to market demand will beincreased, customized offerings will be made possible and finally delivery of marketing
campaigns will be done at a fast and reliable pace.Conclusion:Cloud computing has transformed the computing and technology age in its totality, and theplatforms it has provided effect the ways in which business is conducted. Subsequently, therehas been a dramatic impact on the marketplace and consumer buying behavior. By providingWeb-based software solutions, cloud computing solutions have not only decentralized thebusiness model, but these solutions have revolutionized customer relationship management(CRM) and internal communications, which has improved the effectiveness of sales andmarketing initiatives.All users view the same data, which means there are no hurdles in verticalbusiness communication, and there is definitely a cut-back in the manual labor of data-entry.New advances in cloud computing applications have made it possible for all users to interactwith real-time data and one another, further enhancing the decentralized business model, andnearly trivializing the relevance of geographic location.Having precise, real-time data has greatly improved customer relationship management.Amazon has exemplified how cloud computing resources can effect customer relationshipmanagement, and eventually more of these technological advances will widely available andaccessible to all businesses. This means that the marketplace will be that much automated andcompetitive. Amazon customers create their own accounts, log in, and all of the customer’sinformation and activity is stored elsewhere. It is on the “cloud,” readily accessible to thecustomer, with only a Web browser and an Internet connection, but also readily accessible tosales and marketing executives and employees. With each individual customer’s data beingautomatically input, the overall sales data for the business is instantly reflected and availableon-demand. Sales and marketing initiatives can develop more quickly, since the data can becompiled and compartmentalized into reports that segment sales information, customermarket segmentation, and any other data category relevant to the business. The data can bequickly analyzed and used to identify strengths and weaknesses. New business opportunitiesarise when sales and marketing strategies are tailored to individual customer demands andinterests. They may be used to attract and retain customers, which is an illustration of themutually beneficial advantage of effective CRM. The accurate and readily available datastreamlines sales and marketing operations overall, and therefore the implementation of thesesales and marketing strategies can occur more quickly, resulting in rapid responsiveness to themarket. Rapid responsiveness creates more competition in the marketplace. As a result,businesses must compete with cloud computing solutions in order to stay afloat withtechnological advances in the marketplace, and therefore, survive. This is also true because ofthe advantages on the customer side of cloud computing, which greatly improves the retentionof customers. New customers are then added, since word of mouth in this new wave of socialmedia and social networking is increasingly important and successful.All of the aforementioned illustrates what cloud computing has done for businesses, and whatits potential implies about the future business climate. There is another implication, though.Only in their infancy, cloud computing developments once indicated large scalability; but new
developments seems to underscore global, and even infinite scalability. With improvedcommunications, global scalability, more rapid responsiveness in the marketplace, andremarkable improvements in developing sales and marketing strategies, cloud computingsolutions also imply that expansion into global markets will be much more feasible, fast, andeasy for small to mid-sized businesses.Bio of Mr.Sairam MattancherilMr. Mattancheril is a seasoned, successful leader with over 14 years at FedEx. After being a consultantworking on FedEx Insight and Virtual Order, he joined FedEx as a Technical Advisor in 2000 working onFedEx.com. He has a history of being assigned to special projects given his general technical subjectmatter expertise and aptitude. He worked on and led many initiatives at FedEx.com including MyFedEx,Online Account Management, Custom Rate Guide, FedEx Locator, and Ship Manager. His contributionshave earned him numerous BZs, Hall of Fame and other awards, as well as recognition from executivemanagement.Mr. Mattancheril also has an entrepreneurial streak with stints as the CTO of Krikle, Inc. a Memphis-based startup and helped start Umonitor (now HarlandFinancials). Prior to joining FedEx, he worked forother major corporations including International Paper and Tata Consultancy Services. He has a Mastersin Electrical Engineering from Indian Institute of Technology, Madras.Mr. Mattancheril lives with his family in Memphis and enjoys spending time with his family. He recentlygot promoted as a manager within FedEx and is looking forward to starting his new position on April 16.References: 1. http://csrc.nist.gov/publications/nistpubs/800-145/SP800-145.pdf 2. http://www.convergedinfrastructure.com/Path-to-the-Cloud/ 3. http://jonathanhouston.co.za/cloud-computing-and-what-it-means-for-digital- marketing/ 4. http://www.nytimes.com/2010/04/19/technology/19cloud.html 5. http://www.salesforce.com/cloudcomputing/ 6. http://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/Press- releases/Pages/public-Sector-adoption-of-cloud-happening-slowly.aspx 7. http://www.informationweek.com/news/healthcare/interoperability/225700843 8. http://www.cloudcomputingworld.org/cloud-computing/how-cloud-computing-will- affect-your-business-in-the-next-five-years.html 9. Apple- iCloud Harmony