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PwC Mobile Commerce 2014
 

PwC Mobile Commerce 2014

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    PwC Mobile Commerce 2014 PwC Mobile Commerce 2014 Presentation Transcript

    • The challenges of monetisation Leveraging mobile as a mainstream commerce channel January 2014
    • Agenda Section 1 The ecosystem 2 Mobile Commerce: remains an integrated vision 3 A spot-light on Advertising 4 Summary
    • PwC The ecosystem Leveraging mobile as a mainstream commerce channel Do we really understand the complexity of this ‘new’ ecosystem?
    • PwC We see genuine ‘demand-side’ pull from retailers, banks, brands and advertisers to get more from mobile PwC’s Vision of Mobile Commerce for Retailers in 2013/4 Section 1 – The ecosystem Leveraging mobile as a mainstream commerce channel
    • PwC Section 1 – The ecosystem An intersection of so many differing ecosystems Leveraging mobile as a mainstream commerce channel
    • PwC Mobile Commerce: remains an integrated vision Leveraging mobile as a mainstream commerce channel Usage and adoption are the product of a virtuous circle with marketing, transactions and insights
    • PwC We still believe in the ‘virtuous circle’ being at the heart of any successful m-commerce venture…. Leveraging mobile as a mainstream commerce channel Section 2 : Mobile Commerce: remains an integrated vision Combine data from transaction, response, redemption and purchase history with MNO permission-based customer data Advertising Transactions Smart Data Move ad spend from traditional media into more targeted and measurable ad performance on mobile. Use the immediacy and relevance of mobile to improve productivity and loyalty for retailers, and deliver a more integrated consumer experience between digital and physical worlds Using analytics to maximise possible inventory and customer insight/loyalty whilst maintaining customer relevance and channel usage.
    • PwC …our view of that ‘virtuous circle’ has evolved and in turn, introduces even more complexity….. Advertising Secure Transaction and Relevant Interactions Smart Data &Analytics Data and Insights Market Leveraging mobile as a mainstream commerce channel Section 2 : Mobile Commerce: remains an integrated vision
    • PwC ...in an already crowded and fragmented market, with players seemingly still only focused on one part of the puzzle….. Transaction s Smart Data Advertising Illustrative Leveraging mobile as a mainstream commerce channel Section 2 : Mobile Commerce: remains an integrated vision
    • PwC ...in an already crowded and fragmented market, with players seemingly still only focused on one part of the puzzle….. Leveraging mobile as a mainstream commerce channel Section 2 : Mobile Commerce: remains an integrated vision Key: Required stakeholders Optional stakeholders Media Entrants Data analytics Application provider Loyalty Services Payment network Merchant Acquiring bank Consumer Trusted Service Manager Issuing Bank SIM/ payment software developers Mobile Network Operator Chip/ Handset mfctrer Payment processor Transit Operator Ad Server Reporting Services Coupon Issuing service Voucher platform Media Buyer Advertiser Display Aggregator Location Services Retail POS provider Ticketing & Event Operator Data publishing Insights & Analytics Data Enrichment Data product sales Messaging Aggregator
    • PwC Advertising Retailer Services Wallet Insight Services MMS/SMS & InApp Advertising Display Advertising Vouchers & Coupons Loyalty Services Secure Transactions Ticketing Transactions Payment Transactions In-store and PoS Services Dual Screen Advertising Marketing Insight and Analytics Customer Permissions  Digital Identity Hyper- location Services Credit & Fraud Risk $ Surely success lies in establishing a complete business model alongside a commercially viable product set? Leveraging mobile as a mainstream commerce channel Section 2 : Mobile Commerce: remains an integrated vision
    • PwC A spot light on Advertising The search for profitable new revenues will introduce incumbents to new markets, ‘threats’, challenges and opportunities Leveraging mobile as a mainstream commerce channel
    • PwC Mobile advertising is a real opportunity – as a shift in consumer time is accompanied by a channel shift Section 3 - A spot light on Advertising 0.000 0.005 0.010 0.015 0.020 0.025 0.030 2013 2014 2015 2016 2017 Spendingpercapita($US) Malaysia Thailand Indonesia Philipines Mobile advertising per capita 2013-2017 Sources : Multiple, available on request 34% 19% 17% 12% 18% 199 130 1 1,350 2,241 0 500 1000 1500 2000 2500 0% 5% 10% 15% 20% 25% 30% 35% 40% Wired internet Radio Mobile internet Newspaper Television Time Spent Adex Spent (RM million) Under-spend Over-spend $2.85 $3.96$2.10 $0.64 Blackberry Android iPhone iPad Average CPM by device (USD$) Leveraging mobile as a mainstream commerce channel
    • PwC Poor Measurement Poor User Experience Inertia “Until we track to revenue, little motivation to spend significantly more” – Hotel Chain “We use 7 different agencies for digital” – CPG Firm “We are a career company, management are hesitant to embrace social /mobile” – CPG Firm “e.g. clicking on a banner takes people to the normal website” – Ad Agency Fragmentation / Complexity 7 But the channel is not without its problems…. Customer Viewpoint: Other 34% 31% 17% 10% 8% Section 3 - A spot light on Advertising Leveraging mobile as a mainstream commerce channel
    • PwC Mobile advertising eco-system is dominated by publishers and Ad networks… C o n s u m e r A p p a n d P u b l i s h e r M a r k e t e r WiFi VoIP Devices MusicBar/ QR Code M - Commerce Card Payment Enabler Carrier Payment Enabler Carrier Payment Enabler Ad Servers Mobile Web Browser Mobile Website-Platform Aggregators Infrastructure Mobile Ad Networks Rich Media Mobile Security OS App Discovery App Store App Dev. Platforms Location Technology Location-Based Service Technology Measure- ment/ AnalyticsMedia Agencies Yield Opt/ SSP Mobile Mkt. ExchangesDSPs Agency Trading Desks Agency mCRM/ Data Source: LUMA, PwC Analysis MNOs Section 3 - A spot light on Advertising Leveraging mobile as a mainstream commerce channel
    • PwC The commercials behind (simple) ‘push messaging’ Agency sales method(%) Agency commission(%) Gross revenue= Net revenue = Authorized subscribers (%) Location opt-in subscribers (%) Volume of mobile subscribers (#) Under 18 subscribers (%) Business subscribers (%) Multi-SIM subscribers (%) Push opt-in subscribers (%) 1- Messages per day per subscriber (#) Totalinventory Distribution mix Sell-through rate (%) Brand distribution mix (%) Direct response distribution mix (%) Coupon issuance distribution mix (%) Cost per message (%) Cost per action (%) Cost per message (%) Cost per action (%) Cost per message (%) Cost per action (%) Price per message($) Price per message($) Price per message($) Action through rate (%) Action through rate (%) Action through rate (%) Price per message ($) Price per message ($) Price per message ($) Pricing Section 3 - A spot light on Advertising
    • PwC The commercials behind ‘push messaging’ Agency sales method(%) Agency commission(%) Gross revenue= Net revenue = Authorized subscribers (%) Location opt-in subscribers (%) Volume of mobile subscribers (#) Under 18 subscribers (%) Business subscribers (%) Multi-SIM subscribers (%) Push opt-in subscribers (%) 1- Messages per day per subscriber (#) Totalinventory Distribution mix Sell-through rate (%) Brand distribution mix (%) Direct response distribution mix (%) Coupon issuance distribution mix (%) Cost per message (%) Cost per action (%) Cost per message (%) Cost per action (%) Cost per message (%) Cost per action (%) Price per message($) Price per message($) Price per message($) Action through rate (%) Action through rate (%) Action through rate (%) Price per message ($) Price per message ($) Price per message ($) Pricing Section 3 - A spot light on Advertising
    • PwC Summary Cooperate, Compete or Collaborate Leveraging mobile as a mainstream commerce channel
    • PwC The challenge of monetising the mobile channel • A ‘virtuous circle’ product set is required; going alone is not sustainable • Collaboration among the m-commerce ecosystem will be crucial to achieving strong take up among consumers, merchants and advertisers • M-wallets potentially open up the payments market to a wide range of OTT players (itself a whole new set of competitors….) • In m-payments, the role of anyone outside a Bank is unclear – the value chain today is reliable and efficient. • A conclusion of enabling technology (i.e. NFC, BLE, iBeacon) remains unclear, but waiting for clarity is not advisable, multiple form factors must be engaged with. • And with new entrants like Tencent – who recently applied for a Banking license - entering the m-commerce/m-payments markets, posing a very significant potential threat to both to banks, card networks and MNOs 6 Summary Section 4 - Summary Leveraging mobile as a mainstream commerce channel
    • Thank You pwc.com/my © 2014 PricewaterhouseCoopers. All rights reserved. "PricewaterhouseCoopers" and/or "PwC" refers to the individual members of the PricewaterhouseCoopers organisation in Malaysia, each of which is a separate and independent legal entity. Please see www.pwc.com/structure for further details. PwC Malaysia on AppStore twitter.com/PwC_Malaysia facebook.com/pwcmsia youtube.com/pwcmalaysia www.pwc.com/my