Mobile & The New Experience Economy (And What it Means for IT)
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Mobile is replacing the Web -- not soon, now -- but too many companies have their heads in the sand, convinced it’s just another “trend.” It too shall pass, right? See what Appcelerator co-founder and CTO, Nolan Wright, has to say about why B2U is the only acronym that matters.
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Mobile & The New Experience Economy (And What it Means for IT)
- 1. Mobile &The New Experience Economy (AndWhat it Means for IT) NOLAN WRIGHT, CO-FOUNDER & CTO @appcelerator
- 2. THE ELEPHANT INTHE ROOM What the business will pay for. Mobile is replacing the web.
- 3. 7,095,476,818 TOTALWORLD POPULATION 2,484,915,152 INTERNETUSERS 6,572,950,124 MOBILE SUBSCRIBERS 48%52% URBAN RURAL 35% INTERNET PENETRATION 93% MOBILE PENETRATION SOURCE: We Are Social. wearesocial.sg.JANUARY 2014
- 4. World designed by Ted Grajeda Oro Valley, AZ, US 2013 101% NORTH AMERICA 89% CENTRAL AMERICA 124% SOUTH AMERICA MOBILE PENETRATION BY REGION JANUARY 2014 SOURCE: We Are Social. wearesocial.sg. 129% WESTERN EUROPE AFRICA 67% 112% MIDDLE EAST 151% CENTRAL & EASTERN EUROPE 72% SOUTH ASIA 90% CENTRA L ASIA 92% EAST ASIA 109% SOUTHEAST ASIA 94% OCEANIA
- 5. Mobile phones are now more ubiquitous than indoor plumbing. “DEPUTY UN CHIEF CALLS FOR URGENTACTION TO TACKLE GLOBAL SANITATION CRISIS." UN NEWSCENTER. UN, 21 MAR. 2013
- 6. You are here. Marker designed by Alex S. Lakas San Francisco, California, US 2013
- 7. WHY?
- 8. DUMBTERMINAL (WITH BETTER GRAPHICS) ANTICIPATORY, PARTICIPATORY POCKET DEVICE WHICHWOULDYOU CHOOSE?
- 9. “Do as I say.” “Do as I say.” MOBILE IS BUILT ON INTUITIVE USER EXPERIENCES
- 11. “Saturday and Sunday, we’re masters of the universe. But Monday through Friday we’re dweebs.” – GEOFFREY MOORE AUTHOR, CROSSING THE CHASM AND ESCAPE VELOCITY
- 13. THERE’S ONLY ONE “U” C B2C B B2B E B2E U BUSINESS-TO-USER
- 14. 64% 36% Source: Resource Now 2013 “DOYOU USETHE APPSYOUR COMPANY PROVIDES?” YES NO, I DOWNLOAD MY OWN
- 15. “Delight is the new normal.” – GEOFFREY MOORE AUTHOR, CROSSING THE CHASM AND ESCAPE VELOCITY
- 16. 0 1 MARKET PREMIUM PRICING Extract commodities Make goods Deliver services Stage experiences DIFFERENTIATED UNDIFFERENTIATED COMPETITIVE POSITION THE PROGRESSION OF ECONOMICVALUE SOURCE: Pine, B. Joseph, and James H. Gilmore. Welcome to the Experience Economy. Harvard Business Review, July 1998.
- 18. Today, how would the lines of business react if you said IT would be taking over all mobile apps? (Be honest.)
- 20. THE CONTRACT HAS CHANGED THEN: “Does it work?” NOW: “Does it delight?”
- 21. A revolution in experience is driving an evolution in the stack CLIENT SERVER Early 1990s One-to-one Rich UX (GUI) Distributed computing Local Network INTERNET Late 1990s One-to-many Weak UX (HTML-Based) Server-centric computing Global network MOBILE Today Many-to-many Rich UX (driven by mobile OSs) Distributed computing Internet of Things 1990s TO TODAY
- 22. Data orchestration Optimized payloads Online/offline sync Elastic scale Secure access GreatUX across platforms Openness to any device Apps, not applications Performance metrics Usage patterns Adoption rates Lifecycle efficacy Real-time data to drive actions THREE A’S OF WINNING MOBILE EXPERIENCES
- 23. “Apps and applications are two very different expressions of software….The defining characteristic of an app is its reduced functional presence. Apps do less than applications.That is their goal.” – GARTNER PRENTICE, BRIAN. "THE APP AND ITS IMPACT ON SOFTWARE DESIGN." GARTNER. 18 MAY 2012.
- 24. SIMPLICITYWINS.
- 25. WHATTHE “DEVICE EXPLOSION” REALLY MEANS… 81% Companies build for more than one operating system THEWINTEL MONOPOLY IS DEAD
- 26. WHATTHE “DEVICE EXPLOSION” REALLY MEANS… 66% iOS for the Car will become a priority platform MORE DEVICESARE COMING 51% Google Glass will become a priority platform
- 27. RELEASEVELOCITY IS BEYOND ENTERPRISE CONTROL 17% Release weekly or bi-weekly RELEASE FASTERWITH HIGHER QUALITYAND BETTER EXPERIENCE 48% Release weekly, bi-weekly, or monthly
- 28. EMBRACE A MULTI-PLATFORM STRATEGY 62% Experience with HTML5 is neutral to negative HTML5 -NO SILVER BULLET
- 30. “Mobile is pushing aging web architectures to the brink.” – FORRESTER FACEMIRE, MICHAEL,TED SCHADLER, & JOHN C. MCCARTHY. ”MOBILE NEEDSA FOUR-TIER ENGAGEMENT PLATFORM:WEBARCHITECTURES CAN’T HANDLETHE NEW DEMANDS OF ENGAGEMENT.” FORRESTER RESEARCH. NOV. 2013.
- 34. “Good mobile APIs act as a spur to innovation. Think of them as Lego blocks: the better and more varied the collection of blocks you make available, the better and more creative the objects people build.” “DATA, DATA EVERYWHERE:MOBILE APIS ACT ASA SPURTO INNOVATION.” READWRITE. JANUARY 2014.
- 35. 2014 PREDICTIONS RELATEDTO APIs 89% Companies will invest in mobile-optimized APIs for external developers are third-parties A FOCUS ON MOBILE APIs 88% Connecting to both public and enterprise data sources will become the norm for mobile apps 74% Backend-as-a-Service (BaaS) will overtake PaaS as the preferred cloud solution for mobile developers
- 36. WHAT DOTHEY MAKE OF IT?
- 37. A MOVE FROM LAGGING TO LEADING INDICATORS
- 38. OWNINGTHE EXPERIENCE ENGAGMENT ACQUISITION RETENTION CONVERSION QUALITY The five mobile metrics no company should be without.
- 41. PAST: PLANNED ECONOMY I.T. AS ENABLER OF EXPERIENCES PRESENT: FREE-FOR-ALL FUTURE: “INNOVATION EXCHANGE”
Editor's Notes
- I want to start with a statement that may be controversial.
- Mobile is replacing the web.You may agree, disagree, or violently disagreeBut Ithink this isthe elephant in the room. It’s happening right in front of our eyes, but many of us are simply ignoring it.
- This is truly an unbelievable stat, but underscores the magnitude of what’s happening and how quickly it has happened.
- Mobile isn’t replacing the web “sometime in the distant future”; the inflexion point is upon us.Mobile apps may only be a slice of your overall development efforts today, but it will soon be 100%The other dynamic at play is that the nature of the web is shifting. If you look at some of the emerging mobile first companies like Uber, Instagram and Whatsapp, their web presence is only a web site that points you to their appMore importantly their data is not indexed on the web by Google. It’s either closed off or only accessible via APIsEffectively, mobile is shifting the nature of the web from applications and websites to data and APIs.
- The natural question is why is this happening and why is it happening at such an unprecedented paceHow is it possible that the iPad, a completely new device, could singlehandedly wipe out the entire netbook market overnight and exceed PCs shipments in less than 5 years.
- Here’s a simple way to look at it. Which would you choose:We obviously know the answer because you have chosen, but let’s go a little deeper
- The truth is that the PC was never “personal”. It requires users to conform to it. Both the computer and it’s applications are not intuitive. Training is often required.Contrast that with new mobile devices. They conform to us. They are truly personal devices that are an extension of “me”. They are always with us and they offer seamless, intuitive user experiences The key point is that we mobile is driving a fundamental shift in user experience.The impact of this shift cannot be overstated. The picture on the right is a sign of what’s coming. I have a two year old daughter. When she was 1 she wanted to play with our iPad. I was completely astonished when I saw that she was able to unlock the iPad with a swipe, and she immediately started swiping through the pages of apps and touched the one that looked interesting.For her generation and even those slightly older, this is the world they expect. This is a generation that does not use email at all except to write thank you notes to friend’s parents.
- Imagine a Millenial using an SAP procurement system – this is what you would get.The younger generation doesn’t walk around with two sets of expectations related to experience – they have one.
- Here’s quote from Geoffrey Moore the author of Crossing the Chasm. It highlights the reality that we are treated one way as consumers and another way as employees.Why is this?
- We are all familiar with these distinctions: B2C, B2B and B2E.And we’ve always viewed things differently within these contexts, and typically the best experiences have been reserved for the B2C persona.But it’s clear that mobile is at a minimum blurring these lines, but more likely destroying them. At the end of the day, these are all people and they carry the same expectations with them regardless if they are at home or at work.These in effect have become dead distinctions
- Mobile is driving an entirely new distinction: B2UI think this is an important mind shift that we all need to make. The old distinctions will lead to the same old results and simply will not fly in the world of mobile.A B2U mindset is one that works to create exceptional experiences for all interactions, internal or external. It’s a mindset that applies fresh thinking to all existing processes even the boring ones.
- The reality, of course, is that the shift to B2U is already happeningMovements like BYOD are and BYOA represent the early signs of this shift.As the stat says, 64% of employees download their own apps instead of using company provided appsThe days of IT dictating adoption of hardware and software are coming to an end.The other key point here is that mobile is not about simply porting poor web experiences to mobile. Mobile experiences must be great experiences.
- I think this quote from Geoffrey Moore says it all.Delight is the new normal. Exceptional experiences are quickly becoming table stakes.For those that take this seriously, mobile will prove to be an amazing opportunity. For those that don’t, it will prove to be an significant threat.
- I’ve talked about how mobile is replacing the web and experience has become critically important, but I think there’s a broader shift taking place.Fifteenyears ago, B. Joseph Pine and James Gilmore predicted the rise of the Experience Economy in a Harvard Business Review article.The basic premise is that business are facing a commodification of almost every kind of good or service, which will drive companies to offer exceptional experiences as it becomes the only means of differentiationWe are beginning to see this play out today.Apple is arguably the best when it comes to delivering exceptional experiences and they have gone from near bankruptcy to the most valuable company on the planet.The other interesting thing to note is that winning in the experience economy does not require a company to be large. Look at Instagram, Square, Uber and WhatsApp. These are all small companies each worth billions of dollars. While these are all consumer companies, they serve as leading indicators of what’s to come for the broader market.One of the things that is making this possible is that scale itself has largely been commoditized. In fact, in many cases, size has become a competitive disadvantage, so larger companies need to figure out ways to act like smaller companies. To innovate, and to innovate quickly.So mobile is driving something much deeper than the need to create great apps. It’s changing what companies must do to be successful.The next question is what does all of this mean for IT?
- In the past IT resembled a planned economy.They delivered all technology to the lines of business and had 100% control.But today, we are seeing somewhat of a DIY free-for-all since software has become cheap and in some cases free and it’s easy to find and buy.Technology selection and adoption is often happening from the bottom-up vs. top-downAnd increasingly the line of business is seeking more control and influence over technology
- To highlight this point.How do you think your lines of business would react if you said that IT would be taking over the delivery of all mobile apps.I think it would look something like this.
- To be fair to IT. The current state is not entirely their fault because the contract has fundamentally changed.In the past and often still today, IT was/is focused on cost, quality and timeliness - Making sure things work and are stable.All of the sudden, it’s about five star experiences and delight. This is a massive shift and one that is going to require IT to rethink their role
- The other thing that IT must grapple within addition to changing macro landscapeIs that mobile is fundamentally driving an evolution in the enterprise stack
- So let’s talk about the first “A” apps a little bit and some of the changes that are being driven by mobile.First, we need to understand that apps are fundamentally different from traditional applications.While applications tend to be large and complicatedMobile apps are focused and do less. This is necessary because it’s the only way to deliver a great user experience.
- The bottom line: Simplicity winsWe have to learn to do less and accept that we are going to have more apps not less.
- So for apps, it’s clear we need to embrace a multi-platform strategy, but I do want to touch for a moment on HTML5I think it’s dangerous to see HTML5 as a silver bullet for mobile.While there is certainly a place for HTML5, it’s not going to solve the multi-platform, multi-device problem for us.In our IDC survey, we see that 62% have had a neutral to negative experience with itThe other reality regarding HTML5 is that the OS vendors are rapidly innovating. Each vendor releases thousands of new APIs each year making it increasingly difficult for standards to keep up.And as we all know standards bodies are not fast moving vehicles.
- Let’s switch gears now and talk dataWhile delivering mobile apps is full of several challenges, there is a much, much bigger challenge looming dead ahead related to data. Specifically, how do we unlock all the data in the enterprise systems of record to deliver the transformative experiences the users expect? This is where the second of our three A’s comes in: APIs…
- Our recent IDC survey echoes Forrester’s view with nearly 35% saying their existing web architectures will not work for mobile. Let’s take a closer look at some of the mobile-specific needs that companies are struggling with:#1. Data format is not mobile optimized. Many existing web APIs return data in XML or SOAP, but JSON is the format of choice for Mobile#2. Data payloads are not mobile optimized. Web APIs were built for desktop apps, so their payloads are much larger than what’s needed for mobile.#3. Mobile connectivity can be spotty, so offline and sync use cases must be supported#4. Mobile is driving new usage patterns. Since our devices are always with us, usage tends to be 2-5x higher than desktop web. This means elastic scale is even more criticalThe other requirement not mentioned in the survey results is data orchestration. Mobile apps often leverage many data sources often residing in different locations. APIs need to do this orchestration. You certainly do not want your mobile apps doing it.
- Another dynamic taking place is that mobile developers have absolutely zero interest in dealing with traditional web software infrastructure.This slide shows the traditional web view of the stack. During the web days, developers were intimately familiar with each layer of this stack. But mobile developers don’t want to have anything to do with any of this.They want to focus on delivering great experiences not endless layers of software infrastructureMobile developers view of the world looks something like this:
- Apps and APIs.They don’t care about IaaS, PaaS, databases, and scaling scripts.They just want a rich set of APIs that enable them to deliver the best possible experience in shortest amount of time.
- Said Another way mobile APIs act as a spur to innovation. They are like lego blocks. The better and more varied your collection of blocks, the more innovation you will see.There is absolutely a direct relationship between data and user experience and innovation.
- The shift to APIs is already happening in the market.From our IDC survey, you can see that 89% of companies will be investing in mobile optimized APIs, but not just for internal use but also for use by third-parties88% believe that connecting to both public and enterprise data sources will become the norm for mobileAnd 74% believe Backend-as-a-Service will overtake PaaS as the preferred cloud solution for mobile developers.Gartner echoes this last statistic. They predict that by 2016 40% of all mobile projects will leverage a mobile backend.The bottom line is that mobile is driving the need for a new tier in the enterprise stack.One that can help enterprises build and deliver mobile optimized APIs for any data source regardless of it’s location
- Now let’s explore the third A – analytics.Once you have mobile apps in the field. You need to think about how you measure ROI and how you determine what features to add, what bugs to fix and features to remove
- The first thing to understand is how is mobile different from the web from an analytics perspective.At the most simple level, mobile introduces some new things to think about like user location, user motion, device type, app version, app launches, os version, device orientationBut it has also made capabilities like Funnel Analysis and Cohort analysis must-haves.Funnel analysis allows you to establish a desired flow within an app and measure conversions – how many people successfully completed the flow and for those that did not where did they drop offThis information is invaluable for determining ROI and figuring out what steps in your app flow need to be improved.Cohort analysis allows you to view key metrics across a class of users, so you can easily track the impact of changes in your app to specific user segments.Delivering and constantly improving user experience requires actionable insights.
- From a business metrics standpoint, I would focus on 5 key metrisc:Acquisition. This metric represents reach or how many users have used your appEngagement. How engaged are your users. How long do they stay in the app. What features do they use/not useRetention. Do you users come back. How often do they come back: daily, weekly, monthlyConversion. This is about the % of users that complete key use cases in your app. This is absolutely critical to measuring ROI and identifying where and why users do not convertQuality. Does your app crash. If so, how often and on which platforms. What is causing the crash. What is the load time of the app. If it’s too long users will simply delete your app.IT should be thinking about how to offer these metrics to their customers
- So back to our original state of IT slide. We know where IT has been and we know where it is today.
- The question is what is the role of IT in the emerging experience economy that is being driven by mobile
- I think the future state of IT looks something like an innovation exchange or hub.Where IT does not necessarily deliver everything. Instead they serve as an enabler of experiencesBy offering a set of common reusable services that enable the line of business, internal developers, and third parties like ISVs, other businesses and developers to innovate.And as we discussed the key to enabling great experiences in the mobile age is to have a robust offering centered around Apps, APIs and Analytics.