Outsourcing mobile dev - how to think about your app

How much does it cost to build an app? How long does it take to build an app? Well, it depends on several factors. Apps can be built for as little as a couple of thousand to dollars, or as much as hundreds of thousands of dollars. It all depends on what you want your app to accomplish. We have a created a framework to help you think through your app in some very concrete terms, which can help determine the cost and time to required to build the app.

Requirements v01 MA 9Mar2014.png

We look at this framework as the building blocks for an app. Like with any structure, building it requires setting a strong foundation. This requires having a good grasp of the platform(s) on which you'd like the app to be developed, knowing your localization and internationalization strategy, not leaving security to be an after thought, and having a good sense of which APIs - both internal and external - your app needs to integrate with. Once the foundation has been set you can move to building the core of your application. This involves having at least a feature level grasp of what your application will do. Finally, to maximize the value delivered by your app, you need to understand and implement your apps reporting & administrative needs and how you plan to support the app once it hits production. Let's take a closer look at each of these areas.

The Foundations:

Platform: Knowing which platforms your app needs to be built on is of paramount importance. The wrong decision here can mean the difference between a great app, and one that delivers extremely poor performance and generates little or even negative interest. Some of the key considerations here include:

  • iOS vs. Android vs. Others: This might seem like a pretty simple decision at first, but based on the demographic and region of the world you are targeting, going iOS first or Android first, is not a given. We were helping scope an app targeted towards the lower income market in the emerging world for which a simple text message based service made more sense than an extensive app. On the other hand for some apps to gain maximum virality you might have to go cross-platform from the get-go.
  • Native vs. mobile web - A few years ago HTML5 was all the rage. Today developers have begun to recognize the limitations of HTML5, and the pendulum has swung the other way. The right decision here though is not whats in vogue, but what makes sense for your app - perhaps the limitations of HTML5 are not an impediment for your app.
  • Develop native vs. using a mobile application development platform (MADP) - We will cover this top in a more in-depth manner in a future post, but at a minimum you need to know what the advantages of developing using a MADP platform vs. developing a native app are and why your development team is recommending one over the other. The comparison is usually made between the cost advantages of MADPs vs. the performance advantages of native, however in reality the comparison is rarely that straight forward.

Localization: This aspect of app development is usually not given much thought, and perhaps is as simple as starting off as an English-only app that needs to be deployed in the iTunes app store. However, what if you were an international airline carrier with passengers from all over the world? Suddenly, a seemingly simple decision requires at least some analysis to know which languages your apps needs to support and which countries app stores the app needs to be made available in.

Security: Like with localization, security is too often an after thought. Some very popular apps have taken security lightly and have seen it come back to bite them. Recently the Starbucks app, the most used mobile payments app in the US, was caught up in an embarrassing security breach when it was revealed that it was storing its customers' username, email address, and password in clear text on their mobile phone. Our recommendation is to not take security for granted from the get-go. Do not assume that your app developer will build your app to meet best practice security requirements. Be explicit about the security requirements you expect - particularly as it relates to encryption, authentication, and authentication information retrieval policies. You at least owe this much to your prospective users.

APIs: Today APIs are available for a variety of different popular external B2C applications in particular Facebook, Twitter, LinkedIn, etc., as well as B2B applications such as Salesforce. At a minimum, we recommend that project owners know which applications they need to access through their app and the feature(s) they expect to be able to provide to the end-user by enabling said access. "I'd like my application to connect to LinkedIn" is usually not very informative. "I'd like my application to connect to LinkedIn to be able to auto populate x, y, and z user profile fields" is a lot more useful.

The Core:

Features: Most of the better development teams today either completely or partially adhere to the agile development philosophy. In agile development, the primary unit of work at the team level moves away from a discussion of requirements to a discussion of user stories. These user stories are generally developed in conjunction with the development team and are too granular to invest too much time in up front. Our recommendation here is for you as the project owner to think one level up - at the level of features. 

Screen Shot 2014-03-09 at 3.54.39 PM.png

So what is the difference between a feature and a user story? Let's take the example of a recent that app we helped facilitate the development of that helps you find things to do based on your mood and your location. The ability to determine your location is a feature. However, your location can be determined based on your current coordinates, some future coordinates, or the neighborhood that you live or work in - each of these comprises a different user story. Knowing what can and cannot be done at the user-story level generally requires the guidance of the development team, and is best left to be determined in conjunction with the team.

The Accelerators:

Reporting: Why is reporting important? Shouldn't I be able to capture stats via the number of downloads and the rating that my app has received directly from the app store? That is correct, but that is not really enough information to determine what features within your app are being used, or in what conditions your app crashes, or how long it has been since a specific user has logged into your app, etc. Usually developing your app is just the first step towards attaining a greater goal, and it is impossible to predict whether or not you are making headway towards that greater goal without some deeper insight into how your users are using an app. We highly recommend thinking about what user activities and experiences you'd like to keep track of and accounting for those capabilities when developing your app. Again, like with security, don't take for granted that your development team has a good sense of what those capabilities need to be - it's your app, and you need to take ownership of it. These days, integrating reporting capabilities - even advanced ones - into your app usually doesn't require a ton of additional development effort, but it does require identifying and integrating with the right reporting tools made available by external providers (e.g., Flurry, App Annie, Google Analytics). Knowing which reporting tool to integrate with to deliver which capability is something you should defer to the development team on, but knowing which reporting capability is required in the first place is your responsibility as the project owner.

Admin: There are very few apps that require no administrative capabilities. Below are some common examples of admin capabilities that apps require:

  • Roles administration: Not all users are created equal. Some users might be considered super users and require special privileges associated to a role that they perform on your app - for example adding new stores or restaurants to a curated recommendation app. 
  • Content administration: Your app might be dealing with content submission from your users and you might want to feature or highlight certain pieces of content more than others. This might require content curation capabilities that need to be provided to you as a superuser, but not to every user.
  • Security administration: You might want to be able to change the security policies related to your app, for example the password strength requirements or how often passwords are set to expire. You might want to lock down certain users from your app until certain verification steps are complete. 

When working with an experienced development team, one of the first things they are likely to do is build user personas that are related to different user stories. This should help define the specific actions that you'd like different types of users, including admin users, to be able to perform. However, at a minimum we suggest giving some though to what constitutes an admin user and what features the admin user should be able to control.

Support: Apps don't upgrade themselves, and just because an app works close to perfectly in the beginning, it doesn't mean it will continue to do so into eternity. Apps can break for a variety of reasons ranging from OS upgrades, to API changes, to experiencing a heavier load than they have been tested against. All of these problems can generally be fixed, but not if you don't have the right support mechanism in place to help you. Most teams that develop an app might give you a 2-week or one month warranty window where they will support the app for break-fix type issues, but often you might need support for a longer than a month on app. Additionally, it is critical to know the different between break-fix and a new change. Adding a new capability to an app is not a break-fix issue, in technical terms it is considered a change request, and - depending on the complexity of the app - a change request can be more complex and expensive than developing the app itself. 

In summary, there are lots of things to consider when you go down the path of developing an app. Maybe your app is a use and discard marketing app for which many of the above considerations are an overkill, but even if that is the case it makes more sense to start with a more holistic framework like this and eliminate what you don't need, vs. start something bare and then realize two months into the project that there were several aspects of the app that had not been thought through. Spending and extra week or two researching some of the capabilities that your app needs to support is not a waste of time when you consider that not having those capabilities can easily cost you an extra couple of months or, in the worst case, your reputation.

Mobile app development - why wage arbitrage matters little!

Wage arbitrage has defined the IT services sector for over a decade. Companies in the US in particular, and high cost countries (HCC) in general, began to take notice of the Indian IT workforce starting in the late 90s when preparing for Y2K. In fact, like with many other process optimizations, it was GE under Jack Welch, that began the trend of outsourcing IT services to India as far back as 1991, which was the year that India began to open up its economy. That said it was the noughties when IT outsourcing really came into its own. It was the decade that saw Accenture and Deloitte swell from sub-50K person consulting companies, to 200K+ person outsourcing behemoths, with a majority of that workforce added in low cost countries (LCC), and India in particular. It was also the decade that saw spectacular rise of the Indian IT services sector, most prominently Infosys, Wipro, TCS, Cognizant, and - until its eventual accounting-scandal led demise - Satyam.

However the tide has started to turn. It's not so much that wage arbitrage opportunities have disappeared - in fact an argument can be made that arbitrage opportunities will remain well into the next decade, particularly between India and the US. However, as companies move from leveraging IT to drive internal efficiencies to leveraging IT to build new digital products and services, i.e. towards digitalization, the need for wage arbitrage becomes somewhat irrelevant. Let's consider why.

When you shouldn't offshore:

Consider the following digitalization scenario. You are a large automobile company that is looking to develop an augmented reality app for Google Glass. The app essentially digitalizes your driver manual, by overlaying information pertaining to a specific automobile component or feature simply by looking at it and activating voice commands. Now assume you are the executive within the large automobile company, whose organizations responsibility it is to deliver this app.  From the executives perspective, which do you reckon is the most important success criterion vis-a-vis this particular app are:

  • building the app for the lowest cost possible
  • building the app of the high quality possible

With consumer facing products that represent a brand, it is rarely the former. The goal is usually to build the highest quality app possible under some realistic cost-constraints. This is where mobile application development begins to differ from traditional enterprise application development. With mobile you can build some very very powerful applications, e.g. augmented reality or sensor based applications, with minimal back-end, organizational, or process-driven complexity. What does this lead to? A lower price point than traditional enterprise application development. Traditional enterprise application development generally fell into one of two categories:

  • customization of complex packaged applications like SAP, Siebel etc.
  • full blown customized applications

In either case, these applications generally required integration with a multitude of complex systems and some very esoteric technology skills to build out the application. Additionally, to build these traditional applications, an army of professional services consultants is generally required for everything from gathering business requirements, to change management (as generally these applications required a change in organizational behavior), to deployment and a transition to operations. It is not uncommon for these applications to cost north of $100M, with prices north of $1B to deliver in the case of the most complex transformative apps - think healthcare.gov 2.0 to be delivered by Accenture. At a $100M price point, wage arbitrage makes a lot of a sense - a $20M savings is pretty significant in almost any context - but the average mobile app costs under $250K. Here savings of even $100K are easily trumped by working with a more expensive team but one that can deliver a very high quality product and significantly greater business value.

When should you offshore:

Wage arbitrage is by no means over but, when it comes to mobile application development, building a product offshore is not by any means purely a price decision. It usually only makes sense in one of three conditions:

  • the offshore team is very good at what they do - and is worth offshoring to regardless of price.
  • the client is offshore and needs a team that works in the same time zone/city/region.
  • there are some pretty significant budget constraints, and the individual/company requiring the offshoring capability has experience in managing the offshore team.

As discussed in our blog post on the golden rules of outsourcing, if you are an entrepreneur or a marketer that has no experience in managing an outsourced team, then you should try to avoid outsourcing all together or else enlist the help of a trusted individual/team that has experience outsourcing to do most of the heavy lifting while you learn the ropes. This is quadruply true if you are considering outsourcing to an offshore team for the first time.

5 innovative enterprise-sanctioned B2C mobile apps

It's hard to argue with the statement that enterprises are not as innovative as startups - in fact our very first blog piece was about why NCR couldn't have thought of Square Wallet. However, every once in a while enterprises do innovate, and in rare cases they even inspire startups. Below is a list of 5 apps that have managed to do just that.

Ikea 2014 catalog: This app turns the typical catalog app available on iTunes on its head. It uses augmented reality (AR) to superimpose catalog items into the room that you are viewing through the app. The app essentially enables you to do a virtual preview of furniture in a given room, without having to buy the furniture or move the furniture around. The app is also an example where an enterprise-sanctioned app provided inspiration to a startup

Audi eKurzinfoWhen was the last time you opened the drivers manual that came with your car? Well, with this app you won't ever have to. Again using AR (and built by the same team that built the Ikea catalog app), the app enables you to learn more about a particular control in your vehicle with just a few taps on your phone. Have trouble knowing which compartment is for the coolant, engine oil, or break fluid? No problem! Just point the camera towards it and the app provides you with the information you need.

Nike+ Fuel Band: Yes, we know its not the app by itself that makes the Nike+ Fuel Band magical, but the overall product. To those of you that have lived under a rock for the last few years, the app works in conjunction with the Nike+ Fuel Band, and allows you to track everything from how long you sleep, to how intensely you perform physical activities. Set at the intersection of both the quantified self and wearable tech movements, the product has the potential to change how Nike views itself as a company - transforming from a sports accessories company to a tech company.

Iron Man 3 - JARVIS: A Second Screen Experience: Every entertainment major in the US is looking to build a second screen experience for everything from popular TV shows to sporting events, but few get it right. Marvel got it right with Iron Man 3. Per one of the reviewers, the app makes you feel like you are sitting next to Tony Stark on his couch and you have the remote for his TV. Using the voice of Paul Bettany (the voice of JARVIS) adds to the realism. In the not too distant future studios might look at licensing out actor voices for apps like Siri, in much the same way as they do with skins and wallpapers today.

TurboTax SnapTax: From the insanely fun to the insanely boring! The reality is that taxes are a part of life, and since you have no choice but to do them, then you might as well get them out of the way as quickly as possible. This app allows you to do just that. Take a picture of your W-2, answer a few simple questions, e-file securely from your phone or tablet, and viola you don't have to worry about Uncle Sam for a whole year. OK, maybe its a bit more complicated than that in reality, but by all accounts it is a step up from scanning your W2 and filing it through a web browser. 

Top 10 Retail Apps on Thanksgiving Eve (iTunes)

This being thanksgiving weekend in the US we decided to take a break from our usual heavy posts and look at the top 10 retails apps heading into Black Friday and Cyber Monday. The apps are rated based on their popularity on iTunes, and the rankings have been obtained from AppAnnie.

iTunes Rank* (Lifestyle) App Name Publisher App Type iTunes Rating
1 Black Friday 2013 Ads App - BlackFriday.fm Sazze, Inc. Coupons 4.6 (4,582)
2 Apple Store Apple mCommerce 3.5 (51,632)
3 RetailMeNot Coupons RetailMeNot, Inc. Coupons 4.5 (171)
4 Cartwheel by Target Target Coupons 3.5 (14)
5 Groupon Groupon, Inc. Daily Deals 4.2 (348,989)
6 Amazon App Amazon Mobile LLC mCommerce 3.7 (107,186)
7 eBay eBay Inc. mCommerce 3.9 (207,887)
8 Black Friday FatWallet, Inc. Coupons 2.3 (2,633)
10 Walmart Walmart mCommerce 2.8 (47,483)
12 glasses.com for iPhone 1 800 CONTACTS, Inc. mCommerce 4 (1,079)

Happy Turkey Day, and avoid the lines and/or coupon management hell by using some of these apps!

Lean startup in the enterprise - the era of collaborative engagement (part 3/6)

This is the third entry in our six part series on the era of collaborative engagement that businesses are stepping into. The second entry focused on this being the era of B2C rather than B2B. In this piece we will begin to look at the implications of this shift, particularly as it pertains to how digital products in this new consumer-facing era are conceptualized and developed.

Lean startup:

In an environment where the primary concern is to optimize existing operations, we are generally dealing with a whole lot of knowns, and are building systems and processes to optimize those knowns. On the other hand, when you are developing new consumer facing products and services, the knowns - in particular consumer preferences and user behavior - are a lot less concrete, and what you need to build is not always clear up front. Hypothesis-driven experimentation, as prescribed by the lean startup approach, provides the best mechanism for tackling this problem. 

In his landmark book, The Lean Startup, Eric Ries provides the example of how Intuit uses hypothesis driven validation to build new products and features. Eric cites the example of SnapTax, software developed by Intuit, that initially started with the hypothesis that customers would prefer scanning their W2 to automatically feed the content into their tax returns instead of manually entering the information. However, when they began to test the hypothesis they quickly discovered that scanning could be at least as cumbersome as entering the information manually, and that what customers really wanted was the ability to take a picture of their W2 from their cell phones and have the information automatically populate their returns.

It's not about software:

What's critical to note though is that success of hypothesis driven testing has less to do with developing software than knowing what experiments to run and how to interpret the data collected from those experiments. Consider the example of Dropbox. To test the hypothesis that people were craving a simple to use storage solution that would enable users to synch files across their various devices, Dropbox created a video (see below) to test this hypothesis. Following the release of the video, Dropbox's beta sign ups shot up from a few thousand to almost 75K overnight, which immediately validated the core hypothesis surrounding the product. Yes, in Dropbox's case they did write code to actually develop the product in parallel to releasing this video, however technically this same hypothesis could have been tested without writing a single line or product code.

 

A different approach to managing IT-centric projects:

What the lean startup approach does is add a new stage to how IT-centric projects are managed and success measured. In more traditional IT-centric projects project generally evolve through three phases: 

  • requirements gathering
  • build
  • operate

When deploying consumer-facing products with more unknowns than knows, the requirements gathering stage changes to what can be thought of as the "search" stage. In this stage, like startups, enterprise project teams should focus on hypothesis driven testing to find the right product/product features to build or service/service options to provide. With this change, the success criteria and metrics used to quantify each stage start to look something like this:

Success Metrics.png

Our observation: 

Off late, we have spent a tremendous amount of time and energy researching consumer-facing mobile applications deployed by large companies, and the data we have uncovered is clearly pointing to very limited focus by companies on the search phase. For some perspective, consider these stats for Pepsico.

  • # of apps in Google Play across all brands: 25
  • total max global downloads on Google Play: 1.86M
  • total consumers engaged (assuming all unique consumers, and 50% of engaged users are on iOS vs. Android): 3.72M  

For a company with over 25 millions likes on Facebook, and many times that in terms of global consumers, less than 5M downloads across 51 apps (iOS & Android), for an average of less than 75K downloads per app, is a very low number. What's more interesting to note is that what we see with PepsiCo is not an anomaly, brand after brand from companies across verticals show the same trend. 

In conclusion: 

In our view getting the search phase right is absolutely critical when deploying new products and services. Adding the search phase to the traditional project management approach is the critical first step towards reversing this trend.

Podcast #1 - Jason Rosenblum

We're kicking off our podcast series with an interview with Jason Rosenblum, Director of Emerging and Mobile Products at Dow Jones. Jason started off his career as a developer working with the likes of CNet, Conde Nast, and Time Inc. before moving into product management roles with Dun and Bradsreet, Barnes & Noble, and most recently with Dow Jones, which owns the Wall Street Journal, Barrons, and MarketWatch.  

The podcast covers a lot of ground including Jason's journey from developer to a product director, via. way of an MBA at NYU Stern, product successes and priorities at Dow Jones, the evolution of the media space, and the evolution of computing from personal computing to ubiquitous computing. 

Enjoy!

Enterprise Sponsored Consumer Apps - Development Options

Over the years, the word outsourcing has developed a very negative connotation. However, the reality is that in many scenarios companies do have to consider outsourcing product development. In this blog we examine the various development options available to companies when building consumer facing mobile products. You can use this as a guide to help you think through options that you should consider when developing a new product.

Consumer facing apps within an enterprise are generally sponsored by one of three entities - product or digital, sales and marketing, or customer service. In the table below we look at the type of apps produced by each of these entities, and some examples for each type of app.

 

Sponsoring Entity Description Examples
Product  Core product or service being offered is  digital  Bloomberg for iPadPayPal HereNike+
Sales and Marketing  Application helps drive marketing  campaigns, or maximize sales Iron Man 3 - The Official Game ,Ikea CatalogCoca-Cola Freestyle
Customer Service  Application helps improve customer service  and experience SQ Mobile, Hilton HHonors

I next combined this with the hiring internally vs. outsourcing development framework that I put forth all the way back in our second blog post

Screen Shot 2013-09-29 at 3.51.27 PM.png

The key idea put forth there was that unless you are an information technology company and building your core product, outsourcing development should always be on the table. Based on this I looked at the app examples above, and at the options one should have considered when developing these apps.

Example Company Type Product Type Optimal Strategy
Bloomberg for iPad Finance/Tech Core Develop In--house
PayPal Here Finance/Tech Core Develop In-house
Nike+ Fashion/Apparel & Accesories Core It depends
Iron Man 3 - The Official Game Media & Entertainment/Various Non-Core Outsource
Ikea Catalog Retail/Furniture Non-Core Outsource
Coca-Cola Freestyle CPG/Food & Beverage Non-Core Outsource
SQ Mobile Transportation/Airline Core It depends
Hilton HHonors Accommodation/Hotel & Lodging Core It depends

However, outsourcing is a very broad term, and there are a plethora options to consider when looking to outsource. Below are the primary and secondary options available for the examples mentioned above in scenarios where outsourcing should have been in play.

Example Full Service SI*/Consulting Full Service
Agency
Boutique Consulting/Industry Boutique Consulting/Mobile Licensed
Development
Nike+      
Iron Man 3      
Ikea Catalog      
Coca-Cola Freestyle      
SQ Mobile      
Hilton HHonors      
* = Systems Integrator;  - Primary Option;  ✔ = Secondary Option

Lets consider the rationale for each of the selections above: 

  •  Nike+: Here the product is part of a core product or service that company is providing, hence if the company has the ability to develop it in-house then the company should. That said, the development of the app itself could be outsourced to a team that specializes in mobile product development. Alternately, a full service agency can be used, however the company might or might not require the additional services that a full service agency offers, and hence might end up paying a higher margin than is required.
  • Iron Man 3 - The Official Game: The general industry norm here is to license out game development to external entities, which is what Marvel did here, and it remains the recommended strategy. Outside of this, engaging with a company that specializes in game development for media companies can also be a potential option. 
  • Ikea Catalog: A catalog is probably something that the company releases on a periodic (quarterly, semi-annual or annual) basis, and hence the company should have standard templates and forms that it can use to develop the digital collateral internally, however in the case of this particular app, Ikea was rolling out an augmented reality feature. They could have considered a full-service marketing agency for this, but given the degree of specialization required, a mobile development team that specializes in augmented reality should have been the primary option. 
  • Coca-Cola Freestyle: This app was primarily built to support the discovery of Coke's new freestyle machines. Releasing this app should have been part of a wider product marketing campaign, and hence should have been managed by the full service agency responsible for the campaign. This full-service agency would then have the option of developing the application internally, or outsourcing it to a specialized mobile product development team.
  •  SQ Mobile and HIlton HHonors: In both these case the apps have some very deep integration into the back end systems, including hotel and airline reservation systems, real-time flight scheduling systems, CRM systems, and ERP systems. This type of work is best handled internally or by a full-service Systems Integrator (SI), or a boutique consulting firm that specializes in that particular industry. The development of the front end of the mobile app itself could very well have then been outsourced to a mobile product development team to maximize the UX/UI and development expertise offered by the specialized mobile product development team.

In conclusion, while the decision to build internally vs. to outsource is an important one, it is equally as important to consider the options available when outsourcing and to choose the option that makes most sense for a given scenario. 

 

International Airline Carriers - Travel Apps & Mobility Readiness

Last week I examined the mobile readiness of apps developed by the 6 largest US airline carriers. This week I did the same with popular international carriers. Below is a table outlining their mobile readiness, as well as availability on and ratings across the major mobile device platforms available.

App Landing Page Responsive Web Mobile Web iPhone iPad Android Windows Phone Blackberry
British Airways No No  ★★★
(1K+)
 Compatible ★★★½
(1K+)
★★★½
(45)
★★★
(300+)
Virgin Atlantic No Yes  ★★½
(289)
 Compatible n/a n/a n/a
Air France No Yes ★★½
(123)
Compatible ★★★½
(1000+)
★★½
(13)
★½
(377)
Lufthansa No Yes ★★★½
(1000+)
★★★½
(189)
★★★½
(2000+)
★★★★½
(3)
★★
(99)
Singapore Airlines No Yes ★★
(147)
Compatible ★★★½
(300+)
n/a n/a
Cathay Pacific No Yes ★★★
(131)
★★½
(84)
★★★½
(400+)
n/a ★★½
(45)
Emirates No Yes n/a n/a n/a n/a n/a

Next, I dove a level deeper to examine the core features supported by each airline on their primary mobile apps.

Feature British Virgin Air France Lufthansa Singapore Air Cathay Pacific
Book Flights   ✔ (iOS)
Check In
Flight Status Push Notifications          
Flight Status and Schedules
Multi-Passenger Check In          
Rewards Status  
Flight Details        
E-Boarding Pass    
Games          
In Flight Service Guide          
Alternate Flight Options          
Social Media Integration        
Passbook Integration          
Seat Change          
Weather Information          
In-flight Tracker          
News          
City Guides          
Misc. Fun        
Fare Alerts/Offers          
Upgrade Offers        
Personal Travel Details          
My Trips  
Redemption Bookings          
World Wide Office Directory          
SMS Customer Service          
Virtual Club Tours          
Crew Profiles          
Multi-language support Y (25) N Y (11) Y (12) Y (10) Y (2 partial)

Similar to some observations made in last weeks post, a few things in particular stood out:

  • Like their US counterparts, none of the major international carriers have responsive web sites. As pointed out last week, with the device ecosystem continuing to fragment, and with the current state of the sites built for mobile (again equally as unimpressive as their US counterparts), responsive web design will become a standard sooner rather than later.
  • Apps are an extension of your brand, but they have to have a minimum feature set to be useful. Virgin Atlantic has arguably the most fun brand of any major airline worldwide, and while it delivers on the fun aspect of things, it does little else that can be deemed useful. Not surprisingly, their iPhone app is rated poorly and has attracted some very harsh reviews on iTunes. What is surprising though is that they are the only major carrier that we looked at that has built an app for iOS, but not for Android.
  • Unsurprisingly, unlike their US counterparts, the apps of most major international airlines support multiple languages, with British Airways, Air France, Lufthansa and Singapore Airlines all supporting at least 10 different languages. 
  • Unlike their US counterparts, most international airlines continue to build and support Blackberry apps - this makes sense given that Blackberry's international sales have been their own really bright spot over the last half dozen years. That said, none of the airlines' Blackberry apps have stellar ratings. 
  • Again like their US counterparts, only a minority of the international airlines that we looked at (namely Lufthansa and Cathay Pacific) have tried to take advantage of the larger form-factor afforded by the iPad and built a native app for it. There could be some significant opportunities here that the airlines might be missing out on.
  • The most obvious observation of all: Emirates, which has consistently been considered amongst the three best airlines in the world, does not yet have a mobile app! 

In my view, like their US counterparts, popular international airlines are in the 3rd inning of their evolution to mobile - they too have gone past very rudimentary mobile web sites, built apps, and are now starting to pack on features. The next step would be to step away from features for a bit, assess and enhance overall user experience, and then move towards some more innovative applications of mobile. One example of this is Singapore Airlines doing something very interesting in combining customer service with mobile via. something called PPS connect  (now integrated into their mobile apps). Essentially with PPS connect, customers when traveling internationally, can send an SMS to Singapore Airlines' customer service, who will then call you back within 30 minutes of receiving the SMS. I think the future for providing these type of superior customer service interactions integrated into your mobile app experience offers some very exciting opportunities for the airline industry.

 

US Commercial Airline Carriers - Travel Apps & Mobility Readiness

This week I examined the mobile readiness of apps developed by the major US carriers. Below is a table outlying their mobile readiness, as well as availability and ratings across the major mobile device categories available.

App Landing Page Responsive Web Mobile Web iPhone iPad Android Windows Phone Blackberry
American Airlines No Yes  ★★★
(5K+)
 Compatible ★★
(3K+)
★★★
(200+)
n/a
United Airlines No Yes  ★★★
(1K+)
 Compatible ★★★★
(3K+)
★★★★½
(3K+)
★★★
(41)
Fly Delta No Yes ★★★½
(4K+)
★★½
(766)
★★★½
(5K+)
★★½
(819)
★★
(377)
US Airways No Yes ★★★
(98)
Compatible ★★★★
(64)
n/a n/a
JetBlue No Yes ★★½
(979)
Compatible ★★★★
(698)
n/a n/a
SouhtWest Airlines No Yes ★★★
(27K+)
Compatible ★★★★
(5K+)
n/a ★★
(123)

Next, I dove a level deeper to examine the core features supported by each airline on their primary mobile apps.

Feature American United Delta US Airways JetBlue SouthWest
Book Flights
Check In
Flight Status Push Notifications    
Flight Status and Schedules  
Rewards Enrollment          
Rewards Status
Standby List Monitor        
Flight Details      
E-Boarding Pass  
Airport Locator          
Terminal Maps      
Parking Reminder        
Club Locations      
Club Passes          
Games          
In Flight Entertainment Guide        
Alternate Flight Options        
Social Media Integration      
Purchase Trip Extras        
Manage Travel Preferences          
Passbook Integration      
Checked Bag Tracking          
Seat Change          
Public Transit Details          
Weather Information        
In-flight Tracker          
Fleet Info          
Partner Info          
News          
City Guides          
Misc. Fun          
Fare Alerts           ✔ (iPhone)
Car Reservations          

So, what are the conclusions if any that we can draw from this?  Here are a few that stood out to me:

  • The most glaring gap currently seems to be that none of the major US carriers have responsive web sites. As the device ecosystem continues to fragment, and with the current state of the sites built for mobile (click on any of links under the mobile web column in the first table), responsive web design will become a standard sooner rather than later.
  • Features matter, but its important to understand which features truly matter to the customer. Delta for example has the most features of any carrier, but their apps are not rated much higher than that of the other airlines. In fact none of their apps are rated 4-star or higher, even though they have the widest set of features, and provide them most device compatibility.
  • Apps are an extension of your brand. SouthWest does the best job of this - they are a no-frills airline, and their apps are relatively no-frills as well. Similarly JetBlue has a fun playful image, and some of the app features they provide (e.g., City Guides, ability to create custom post cards, etc.) help drive that brand image.
  • Delta and American aside, none of the other major carriers have made any significant effort to consider the possibilities of developing native apps for the iPad. There is some significant opportunity here, given the different form factors that the carriers might be missing out on.
  • Except for United, all other airlines have created landing pages for their mobile apps. As the number of apps and mobile devices supported continue to increase, I think this will become almost a necessity, as app discovery on both iTunes and Google Play can be a huge challenge in its own right.
  • The most obvious observation of all - Windows Phone and Blackberry remain at best a marginal consideration. American Airlines in fact discontinued support of their blackberry application.  

In my view, airlines are in the 3rd inning of the evolution from web to mobile - they have gone past very rudimentary mobile web, built apps, and are now starting to pack on features. The next step would be to step away from features for a bit, assess and enhance overall user experience, and then move towards some more innovative applications of mobile.

Next week we will look at what some of the major international carriers are doing with mobile. 

Focus on B2C vs. B2B - the era of collaborative engagement (part 2/6)

This is the second in our series of blogs focussed on the era of collaborative engagement that businesses are stepping into.

The eras of personal productivity and organizational productivity were inherently both very inward looking. This made sense given that:

  • the technology required for external collaborative engagement with consumers had either not been invented or was in its infancy
  • there was clear line of sight ROI that could be driven by attacking the lowest hanging fruit first - i.e. improving average employee efficiency, and overall organizational efficiency

In 2013 the ability to interact directly with consumers is greater than its ever been, and its no longer enough to simply improve profit margins by driving internal efficiencies. Lets look at each of these topics in a bit more detail.

Improved ability to interact with external constituents:

Interaction with consumers usually occurs in the context of three business functions - marketing, sales and customer service. The most obvious change that has occurred since the dawn of the Internet is the increase in the number of communication and collaboration channels available for each of these business functions.

 

Business Function Channels.png

Marketing: Until very recently marketing was largely analog and outbound. Even the term inbound marketing was not coined until 2005. Fast forward to 2013 and marketing's focus is almost entirely digital, and increasingly inbound. The technologies that were required to supercharge inbound digital marketing - SEO, blogs, and social media platforms - came into their own in the 2000's. Beyond providing marketing an outlet to build brand awareness and loyalty, blogs and social media have combined to enable collaboration between brands and consumers, ultimately giving consumers a much more immediate and larger say in shaping a business' products and services. In parallel, outbound marketing technology is also improving significantly. Outbound marketing efforts are moving past simple demographic targeting to hyper-targeting consumers based on their personal preferences and whereabouts.

Sales: Even though e-commerce sales average less than 6% of total US retail sales, the percentage has been increasing every quarter. With the increased adoption of mobile and social commerce the percentage of total retail sales represented by online sales will start to increase at an even greater pace. Additionally, the technology available to physical sales representatives, ranging from insurance agents to in-store sales representatives, is improving leaps and bounds. As we look into the future, with the emergence of big data, wearable technology, and augmented reality, online and offline sales will, in some sense, begin to merge. It's only a matter of time before your general purchase preferences are known from the minute you walk into a store, and your sales experience is customized based on that.

 Customer Service: It wasn't until the early to mid 2000's that Unified Communications across legacy voice and early web channels began to see serious adoption. VoIP technology within the enterprise only began to get deployed in the early 00's, with most companies spending the bulk of the 00's converting their legacy telephony infrastructure to VoIP. However, while this was happening social media began to emerge and it was no longer enough to offer customer service agents a unified view of the customer across traditional channels. Today customer service organizations have to be concerned about real-time multi-way conversations on everything from forums to blogs to social media platforms. Moving forward, leading customer service organizations will begin to use data and predictive analytics to take a much more proactive approach to offering customer service, thus helping turn a potentially negative tweet into a positive one.

Improving profit margins by driving internal efficiencies:

After the post-World War 2 boom decades of the 1950's and 1960's, US corporate growth began to suffer setbacks in the 1970's. A confluence of events, ranging from the OPEC-led oil embargo to the rise of Toyota led Japanese lean-manufacturing, began to disrupt American industry. However, coming out of the tumultuous 70's Apple and Microsoft heralded the beginning of the PC era. The productivity gains available from moving corporate workforces away from largely pen, paper, typewriter and timeshare terminals, to the Macintosh or, more likely, a Wintel PC were immediate. As this was happening the groundwork was being laid for the adoption of TCP/IP in corporate settings everywhere. Adopting a common networking standard was key in the evolution of client-server computing. By the early 90's, most companies had built out LAN and WAN capacity and the timing proved perfect for the release of SAP R/3. Starting in the early 80's, operations engineers had started to look east for inspiration on how to compete with Japan Inc., and found what they were looking for in Kanban style lean production. With the release of R/3 the technical capabilities finally existed at a low enough price point that companies began en masse to ruthlessly apply the principles of lean production across their entire supply chain, which was by now largely global. How successful did the combination of the personal productivity era and organizational productivity era end up being at driving corporate profits? Look no further than the chart below:

 Credit:  The Atlantic

 Credit: The Atlantic

The argument we are making here is not that there are no longer personal or organizational productivity gains to be had. Rather, we believe that improving efficiencies will no longer be enough to differentiate companies from their competition. Technology and the economies of scale that were once available only to the largest corporations are now available to even the smallest startup. Hence, as the cost side of the equation begins to even out, in order to outperform competitors companies will have to grow their top line and this can only happen by building better products and services, accurately targeting the right consumer, and by creating an overall delightful consumer experience.

The mobile revolution - its only just beginning!

In most of our interaction with large companies so far we have found that interest in what we are doing, as well as in mobile general, originates from these companies' marketing organizations. It is not surprising that when a new communication medium emerges, marketing is the first organization in a company to take notice and look for novel ways to build brand awareness, interact with consumers, and generally  find ways to communicate value to end users of a product or service. What is surprising though is that most companies have yet to take advantage of the full capabilities of mobile. Quite literally your average smart phone can:

 

Screen Shot 2013-07-28 at 7.38.11 AM.png

The implications of the mobile phone as a communication device are well understood, however the other aspects of it, in particular, it's ability to compute and sense while being mobile, its most distinguishing feature from the PC era, are quite a bit less harnessed by companies.

 Compute: In terms of CPU speed, memory, storage, etc., the iPhone 5 is as advanced as most average laptops from even half a dozen years ago. Granted, the screen size does not compare favorably to most laptops or desktops for visually interactive or analytically complex applications, however if this Indiegogo campaign for the Ubuntu Edge (apprx. $7M of $32M has been funded in 5 days) reaches it goal, then even that challenge will be sufficiently mitigated in the not too distant future. Whether the Ubuntu Edge achieves this, or a near future generation of iPhone or Anrdoid device, its only a matter of time before a convergence occurs between your mobile phone and your laptop. There will of course be people that need more computing power and will supplement their mobile device with a laptop, desktop, an EC2 cluster or even a supercomputer, however a majority of people will be able to make do with just one all-purpose computing device. 

Samsung Galaxy 4S Sensors

Samsung Galaxy 4S Sensors

Sense:  The number of sensors being built into mobile phones is increasing with every new release. Add to this, the increasing number of external sensors that you can connect to your smart phone and the possibilities are immense. Consider for example Kinsa's smart thermometer, it plugs into the iPhones headphone jack, tells you your body temperature, provides information on local illnesses, and allows you to quickly secure an appointment with your nearest urgent care facility.

While Mobile: This is the essence of what makes mobile, mobile. The ability to communicate, compute and sense, while on the move and in the midst of every day economic activity, is truly what makes mobile game changing. Once more marketers are the first to the party here with geo-precise targeting of marketing campaigns. Startups like Nomi take it a step further and allow retailers to track in-store behavior of customers and reward loyal customers. Again here, its only a matter time of time before mobile begins to:

  • replace every aspect of whats in your wallet - from credit cards to loyalty cards to identification cards
  • becomes your personal health monitoring aid, particularly when your on the road, helping you measure body temperature, glucose levels, and blood alcohol content
  • almost completely replaces the need for non-core automative computing capacity in vehicles - it has already replaced the need for an external MP3 player, and is threatening to do the same to an external GPS

We truly believe that mobile is a paradigm shift in what computing offers, and the opportunities that it can create are on par with, if not greater than, the opportunities created by personal computing. In some ways its an extension of the personal computing revolution, but in many ways its a new revolution in its own right.

 

Why NCR couldn't think of Square Wallet

Not too long ago the verdict was being passed that IT no longer provided a competitive edge to a company, and was simply a commodity that every company spent money on – in some ways not too different from electricity. Like with every commodity the key was to simply get more of it cheaper, and that’s what most IT organizations started doing post the dot com bubble. IT budgets related to innovation in most large enterprises were cut to the bone, and the only IT projects that were generally undertaken usually involved words like consolidation, outsourcing, or off-shoring.   

Fast forward to 2014, we see digital native businesses being built that impact practically every industry - from financial services to healthcare to agriculture. While IT’s old guard has been busy keeping the lights running at the lowest possible cost, whole new companies are being created around IT. Take the example of the Square Wallet. It essentially allows you to place all your credit cards, loyalty cards, and receipts into one app, and then pay using your name while checking out. It's a simple to use mobile app, that could have been developed by MasterCard, Visa, American Express, or a 125+ year old company called NCR, but it was thought off and elegantly built by Square - a company founded less than 5 years ago. 

Failure of companies not to think of IT as a strategic differentiator, risks not just the IT organization loosing its relevancy, but a company itself being made irrelevant by its more nimble and digital native competition. While there are some legacy companies that are beginning to see the light, in particular Nike with its Fuel Band, Coca Cola experimenting with Freestyle, and Ford heavily integrating software and intelligence into their vehicles - a vast majority of legacy companies still view IT as a cost center. This has to change, and change fast!