Measuring M-Commerce Maturity: A Must Do in a Mobile Enabled World


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When developing a mobile strategy, retailers need to consider the maturity of their current offering and identify m-commerce opportunities that make the most business sense.

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Measuring M-Commerce Maturity: A Must Do in a Mobile Enabled World

  1. 1. • Cognizant 20-20 InsightsMeasuring M-Commerce Maturity:A Must-Do in a Mobile-Enabled World Executive Summary The vast majority of retailers, however, have been slow to appreciate the power of the Mobility is transforming how consumers shop mobile channel, or m-commerce as it has come and how retailers manage their businesses. to be known. Fence sitters still exist, even though Consumers, powered with information about some retailers have made piecemeal progress. products and prices right at their fingertips and Among those retailers that have embraced available on the go, are driving this change, and m-commerce, many are still searching for a retailers are forced to follow. The business case comprehensive strategy. According to a 2011 has shifted from “whether” to “how and what.” survey by Forrester Research, Inc.,1 about 81% of News reports paint a story of this ongoing retail online retailers have or are developing a mobile transformation, as well as the industry investment strategy. However, according to Forrester, many and exceptionally high hopes in this area (see strategies are in the early stages, with 45% of Figure 1). 202 respondents saying they were just beginning to work on a strategy, and just one-third saying News Reports on Retail their defined mobile strategy was more than one Transformation year old.2 eBay Mobile Sales Grow 134% But as the mobile revolution sweeps the consumer world, retailers everywhere are belatedly waking Shopping by Mobile Will Grow up to m-commerce’s potential. It’s no wonder that to $119 Billion in 2015 investment in mobile is a priority for many retail- have ers this year, and beyond. According to Forrester,3 tions M ansac 8 to $500 bile tr 00 70% of respondents plan to increase their mobile al mo in 2 PayP om $25M 10 n fr in 20 grow searc hes investments in 2011 compared with 2010. And 70% Google up 230% lated ing-re evices we Shopp obile d re of respondents in a National Retail Foundation/ m from in 201 0 KPMG survey said they considered e-commerce US mobile payments will and m-commerce as a strategic initiative for 2011, reach $1 trillion by 2015 up from 28% a year ago. Home De pots $64 Investmen Million Mo t Rolls Ou bile t to 1,970 Stores Seeking the M-Commerce Fast Track site Marks & Spencer mobile commerce 4 Progressive retailers such as Target, Best Buy, que visitors in just nets 1.2 million uni months since its launch Amazon and eBay have strong mobile offerings covering various platforms, utilizing mobile device Figure 1 capabilities and providing rich user experience cognizant 20-20 insights | june 2011
  2. 2. and functionality. While they attempt to fully there,” many retailers gave little thought toengage customers on this new channel, others the aforementioned questions, leading to weakare still building an m-commerce foundation. offerings that do not keep customers engaged or, worse, make them frustrated. It is high time forBefore retailers hop on the mobile bandwagon retailers to act.with both feet, they must ask themselves: Mobile Maturity Assessment• How does my mobile strategy fit into the overall multichannel strategy? A key starting point, either for retailers with an offering in place or in the planning stages, is• Does my mobile strategy have the right to assess the maturity of their mobile offering elements to help advance my m-commerce goals? Is it flexible enough to quickly adapt to (current and future) and identify opportunities the dynamic marketplace? that make the most business sense. The biggest hurdle, considering the vast ocean of opportuni-• Do I have a team aligned and empowered to ties available and the buzz around mobile, is an execute on that strategy? objective, holistic and systematic way to perform• What feature set should my mobile offering such an assessment. include, near-term and longer-term? Our Retail Multichannel Strategy Consulting• How do I design the user interface for the best Practice has developed a framework to objective- shopper experience? ly assess the maturity of a mobile offering. Called• What technology architecture should I adopt? mVal (for mobile eValuator), this framework canMost retailers, if not all, have a mobile presence also be used to benchmark a retailer’s mobile— either a native app running on an iPhone or offering against competitive offerings withinAndroid device, a mobile-optimized Web site or the retail industry or other customer-centricboth. However, very few mobile offerings have industries, leading to an understanding of themet retailers’ expectations. Responding to the contextually relevant opportunities and bestpressure of quickly “getting something out practices available.M-Commerce Assessment Methodology Measure Match Mobilize Assess current Compare with industry Identify opportunities channel capability benchmarks to enhance Assess current state of Assess mobile implementation Identify opportunities mobile offerings on the of competitors. for improvement. Activities following dimensions: Collect mobile best Prioritize opportunities Strategy practices from other based on value and cost. Organizational effectiveness relevant industries. Functionality Develop a roadmap User experience Perform gap analysis. to achieve desired state. Technology Maturity assessment Comprehensive assessment Maturity profiler Tools questionnaires questionnaires Health scorecard Exhaustive list of mobile Industry best Comparison matrix retail features practices reports Retailer’s mobile health scorecard Industry best practices Results Mobile maturity profiles of competition Recommendations Detailed feature comparison matrix RoadmapFigure 2 cognizant 20-20 insights 2
  3. 3. The objectives of mVal include the following: In addition to the overall maturity scores for the five dimensions, mVal provides drill-down scores• Assess the maturity of your current mobile at detailed levels. The approach not only helps offering along the following dimensions: retailers unearth opportunities, but it also allows > Mobile strategy these businesses to prioritize opportunities in a > Organizational effectiveness systematic way, clearly showing, in a graphical format, the trade-offs among the opportunities. > Feature/Functionality Sample outputs are depicted in Figure 3. > User experience > Technology Embracing M-Commerce• Benchmark against competitors to identify Armed with a powerful weapon — the smartphone strengths and opportunities. — the consumer is truly the king. And like a king, the consumer is demanding, hard to please, has• Identify best practices and insights from other a fleeting attention span and can be punishing. industries for differentiation. This is why retailers need to not only provideBased on our experience working on various consumers with a mobile offering but do so withmobile initiatives, we have developed a detailed proper due diligence. It is equally important toset of parameters to objectively assess each of the continuously scan the marketplace and makeabove dimensions. mVal calculates the maturity sure (relative to rivals) that the mobile offeringscores for each dimension, providing retailers remains fresh and engaging.with a clear view of where the gaps lie. Figure A mature offering will be the one that not only2 provides an overview of the mVal assessment keeps the customer happy but also helps achievemethodology. the lofty m-commerce goals expected by the industry.mVal Sample Outputs 3.50 3.5 3.00 3.0 2.75 2.50 2.5 Key Performance Areas Health Indicator 2.0 !Scores 1.50 Product Search 1.5 3 Product Catalog Display 1.0 Store Locator 3 0.5 Account Management 6 0.0 Shopping Cart/Payment ! Mobile Organizational Functionality User Technology Strategy Effectiveness Experience Mobile Maturity Profile Health Scorecard y4 y5 y3 y2 y1 pan pan pan pan pan High Com Com Com Com Com Product Search • XXXX provides option to search using a 10 2 13 3 17 1.02 0.76 1.95 0.58 3.22 barcode scan 7 4 Product Catalog • XXXX displays departments using tappable 9 Display 2.18 1.97 3.46 2.91 2.56 images rather than the usual list structure 5 Value Shopping Cart & Checkout X • Except XXXX and XXXX, others provide cart on the native app 20 11 1 15 2.32 2.38 3.06 2.91 2.56 • XXXX allows a gifting option during checkout 12 Deals & • Most apps have a strong focus on deals, with 18 19 Promotions deals and offerings on the home page 16 2.66 1.46 1.56 2.24 3.23 8 14 X • Only XXXX and XXXX provide informationwith Store Locator on 6 store events and announcements, along Low 1.33 2.38 2.14 2.10 3.00 basic store information in store locator Low High Lists • Only XXXX provides detailed list functionality Complexity 0.96 0.96 0.00 1.67 1.11 • XXXX allows placing items on a “watch list” Gift Registry • Only XXXX allows management of a gift 0.00 0.00 0.00 1.74 0.00 registry on the app Prioritization Matrix Competitive AnalysisFigure 3 cognizant 20-20 insights 3
  4. 4. Footnotes1 “The State Of Retailing Online 2011: Marketing, Social, And Mobile,” Forrester Research, Inc., June 3, 2011, id/58625/t/22 “How Mature Is Your Mobile Strategy,” Forrester Research, Inc., October 18, 2010.3 “How Mature Is Your Mobile Strategy,” Forrester.About the AuthorsSurya Prakash Saurabh is a Consulting Manager in the Retail Practice within Cognizant BusinessConsulting. He has an MBA from the Indian Institute of Management and helps retail clients succeed intheir multichannel initiatives. He can be reached at CognizantCognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process out-sourcing services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered inTeaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industryand business process expertise, and a global, collaborative workforce that embodies the future of work. With over 50delivery centers worldwide and approximately 111,000 employees as of March 31, 2011, Cognizant is a member of theNASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performing andfastest growing companies in the world. Visit us online at or follow us on Twitter: Cognizant. World Headquarters European Headquarters India Operations Headquarters 500 Frank W. Burr Blvd. Haymarket House #5/535, Old Mahabalipuram Road Teaneck, NJ 07666 USA 28-29 Haymarket Okkiyam Pettai, Thoraipakkam Phone: +1 201 801 0233 London SW1Y 4SP UK Chennai, 600 096 India Fax: +1 201 801 0243 Phone: +44 (0) 20 7321 4888 Phone: +91 (0) 44 4209 6000 Toll Free: +1 888 937 3277 Fax: +44 (0) 20 7321 4890 Fax: +91 (0) 44 4209 6060 Email: Email: Email:© Copyright 2011, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any form or by anymeans, electronic, mechanical, photocopying, recording, or otherwise, without the express written permission from Cognizant. The information contained herein issubject to change without notice. All other trademarks mentioned herein are the property of their respective owners.