Tag Archives: mobile consumers

Demographics and Research Approach

TCS designed this study to focus on consumer industries, both manufacturing and service companies, in four regions of the world: North America, Europe, Asia-Pacific and Latin America.

We focused the study with these parameters:

  • B2C and B2B2C companies, not B2B
  • Surveying and interviewing companies on how they were responding to mobile consumers – not interviewing or polling the consumers themselves
  • Mobile devices – largely smartphones and tablet computers, but also feature cellphones and other electronic devices that companies provide to consumers
  • Marketing, sales and customer service processes rather than manufacturing, supply chain or financial processes
  • On apps and websites to support mobile consumers, rather than on traditional websites and e-commerce sites
  • How companies are using social media, big data and analytics to shape the mobile consumer experience

With this scope in target industries and their operations, we boiled down the issues of exploration into five sets of questions:

1. How important is the mobile digital consumer to these industries? Which industries think they will have a bigger or less impact on them and why?

  • How much do companies in each industry we survey believe that consumers armed with powerful electronic devices, apps and social media will affect their business – both their products/services, how the bring them to market (their processes) and the customer experience?

2. Which industries are most advanced to date in responding to the mobile digital consumer?

  • Which ones are producing the most mobile apps? What kinds of apps have they developed? How many more and what types of apps do they plan to develop over the next 2-3 years?
  • Which sectors are furthest ahead in managing the data explosion from mobile digital consumers?

3. How are industries changing the consumer experience to win over the mobile digital consumer?

  • How are different sectors changing their marketing processes? Sales processes? Post-purchase customer care/service processes?
  • What changes in their customer-related and supply chain systems are they making to respond effectively to the mobile digital consumer (e.g., marketing, POS, warehouse/distribution)?

4. What industries are changing their core products to appeal to the mobile digital consumer?

  • Especially media, retail banking, and other industries whose products are digital and can be provided through mobile apps

5. What are the key challenges and success factors in responding to the digital mobile consumer?

  • What are the key success factors of companies that have been the best to date in responding to the digital mobile consumer?
  • How are they managing “Big Data” from purchase transaction, social media and other data?

Demographics and Research ApproachTo explore these issues, we designed and fielded a 23-question online survey in June and July with companies (most > $500 million in revenue) in our four regions of the world. The questionnaire consisted of multiple choice, ratings and rankings, and yes/no questions. In all, 664 people participated in the survey, and 609 completed all 23 questions. The survey was fielded by a research firm (ResearchNow) that maintains a large panel of senior managers and directors from large companies around the world. For survey respondents in the retail and media/entertainment sectors, we asked an additional set of questions that were specific to their industry.

From June through August, we interviewed executives at seven companies to hear about their mobility initiatives. These interviews typically lasted 45-60 minutes and involved executives who were leading their company’s mobile initiatives.

We also conducted extensive secondary research, searching for examples of companies that had gone public with some aspects of their consumer mobility initiatives. We surfaced dozens of anecdotes and other examples drawn from these companies’ websites, speeches at conferences, investor presentation transcripts, press releases, articles in business, industry and technology publications, and articles these companies may have self-published.

Here are the demographics by region:


North America

Q4A / North America: Respondents by Country

Q4A / North America: Respondents by Country


Q2/North America: Respondents by Annual Revenue ($ U.S.) 

Q2/North America: Respondents by Annual Revenue ($ U.S.)


Q3/North America: Respondents by Functional Area

Q3/North America: Respondents by Functional Area


Q4/North America: Respondents by Organizational Level

Q4/North America: Respondents by Organizational Level


Europe

Q4A/Europe:Respondents by Country 

Q4A/Europe:Respondents by Country


Q2/Europe: Respondents by Annual Revenue (in USD)

Q2/Europe: Respondents by Annual Revenue (in USD)


Q3/Europe: Respondents by Functional Area

Q3/Europe: Respondents by Functional Area


Q4/Europe: Respondents by Organizational Role

Q4/Europe: Respondents by Organizational Role

 


Asia-Pacific

Q4a/Asia-Pacific

Q4a/Asia-Pacific


Q2/Asia-Pacific

Q2/Asia-Pacific


Q3/Asia-Pacific

Q3/Asia-Pacific


Q4/Asia-Pacific 

Q4/Asia-Pacific

 


Latin America

Q4a/Latin America

Q4a/Latin America


Q2/Latin America

Q2/Latin America

Q3/Latin America 

Q3/Latin America


Q4/Latin America
 

Q4/Latin America

 


Latin America: Key Success Factors: Letting the Digital Mobile Consumer Do Business the Way She Wants

Latin American companies didn’t vary significantly in the importance they attached to the 14 factors that contribute to success with digital mobile consumers. On our scale of 1-5, their answers ranged from an average 3.73 (for “managing cannibalization in our channels”) to 4.19 (“enabling consumers to do everything they want to do with our company through their mobile device”). (See Exhibit VI-14.)

The most highly rated success factor suggests that Latin American companies are thinking broadly – not narrowly — about how they could do business with consumers and their mobile devices. The fact that they already do a high percentage of sales, marketing and service interactions through consumers’ mobile devices shows that they are already highly “mobile-friendly” businesses.

The second most important factor – getting their consumer-facing functions of marketing, sales, service, etc. to work together on behalf of mobile consumers – suggests these companies are aware of the strong need for cross-functional collaboration. Without it, many departments in a company can create mobile apps that wind up competing with each other.

Connecting mobile data to enterprise systems was rated third highest in importance. Data on inventory (ERP), customers (CRM) and where orders are in the supply chain (SCM) are in such enterprise systems. Unless a company connects its mobile systems to its enterprise systems, it will have a hard time letting customers know such things as whether a product is in stock, where it is in the delivery chain, and which customers deserve the red-carpet treatment.


Exhibit VI-14: Q21/Latin America: Key Success Factors in Winning Over Digital Mobile Consumers (Scale of Importance, 1-5)

 Exhibit VI-14: Q21/Latin America: Key Success Factors in Winning Over Digital Mobile Consumers (Scale of Importance, 1-5)


 

Findings: Latin America
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Latin America: Consumer Transactions Through Mobile Devices: High and Increasing

Latin American organizations told us that a high proportion of their total interactions with consumers were happening via mobile devices today: 43% of all consumer purchases, 43% of marketing campaigns; and 42% of service transactions. (See Exhibit VI-4.)


Exhibit VI-4: Q11/Latin America: Measuring the
Impact of the Digital Consumer Across Industries

Exhibit VI-4: Q11/Latin America: Measuring the Impact of the Digital Consumer Across Industries


These companies envision that such consumer transactions will only increase over the next three years, estimating them to constitute 58-59% of marketing, sales and service transactions. Of course, this is only their guess. Nonetheless, it is a directional statement that suggests these companies are looking for ways to improve the ways they do business with consumers who use mobile devices.

When looking at the average percentages of purchase, marketing and service transactions through the mobile channel in the four Latin American industries we mentioned earlier, the retail sector emerges as the friendliest to date for mobile consumers. (See Exhibit VI-5.) The Latin American retailers surveyed said 59% of payment transactions were done through a mobile device. Banks estimated their number at 51% — both far above the average (43%) for all 90 companies (which included other industries besides the four we report on).


Exhibit VI-5: Q11/Latin America: % of Total Consumer
Purchases Through Mobile Devices (2012)

Exhibit VI-5: Q11/Latin America: % of Total Consumer Purchases Through Mobile Devices (2012)


When asked to estimate the percentage of consumer payment transactions by 2015, all four industries believed it would grow considerably. Retailers expect more than three-quarters of mobile payment transactions to be done through mobile devices then (76%), and for banks the number was 68%. (See Exhibit VI-6.)


Exhibit VI-6: Q11a/Latin America: % of Total Consumer
Purchases Through Mobile Devices Expected by 2015

Exhibit VI-6: Q11a/Latin America: % of Total Consumer Purchases Through Mobile Devices Expected by 2015


Retailers also are leading the way in the percentage of total marketing campaigns they’re designing for mobile devices. They estimate that they will design 62% of their marketing campaigns this year just for mobile devices – more than double the percentage of consumer product companies (26%). And retailers project that 81% of their marketing campaigns will be geared for mobile devices in three years. (See Exhibits VI-7 and VI-8.)


Exhibit VI-7: Q12/Latin America: % of Total Marketing Campaigns Designed
Exclusively to be Read by Consumers Using Digital Mobile Devices

Exhibit VI-7: Q12/Latin America: % of Total Marketing Campaigns Designed Exclusively to be Read by Consumers Using Digital Mobile Devices


Exhibit VI-8: Q12a/Latin America: % of Total Marketing Campaigns to be Designed Exclusively to be Read by Consumers Using Digital Mobile Devices by 2015

Exhibit VI-8: Q12a/Latin America: % of Total Marketing Campaigns to be Designed Exclusively to be Read by Consumers Using Digital Mobile Devices by 2015


Retailers also are leading the way in responding to consumers who use mobile devices in their post-sale service interactions. Retailers said 63% of such service interactions are with consumers using mobile devices – far above the cross-industry average of 42% today. (See Exhibits VI-9 and VI-10.) All sectors see consumers making an increasing percentage of their post-sale service interactions through mobile devices by 2015.


Exhibit VI-9: Q13/Latin America: % of Total Customer Service
Transactions Conducted by Consumers Using Digital Mobile Devices (2012)

Exhibit VI-9: Q13/Latin America: % of Total Customer Service Transactions Conducted by Consumers Using Digital Mobile Devices (2012)


Exhibit VI-10: Q13a/Latin America: % of Total Customer Service Transactions Predicted to be Conducted by Consumers Using Digital Mobile Devices (by 2015)

Exhibit VI-10: Q13a/Latin America: % of Total Customer Service Transactions Predicted to be Conducted by Consumers Using Digital Mobile Devices (by 2015


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Findings: Latin America
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Asia-Pacific: Degree of Product and Process Change: More Than Moderate, and Likely to Increase

The 109 Asia-Pacific companies that we surveyed (in Japan and India) reported more than moderate changes in products and processes to deal with mobile consumers. They said they had changed their marketing campaigns to the largest extent, based on our scale of 1-7 (1=no change, 4= moderate change, 7= very high change). They made smaller changes to their core products and services. (See Exhibit V-1.)

They expected to continue making more than moderate changes to their products and processes by 2015.


Exhibit V-1: Q9+10/Asia Pacific: Degree to Which Companies Have Made and
Will Make Changes to Respond to Digital Mobile Consumers
(Scale of 1-7, 1=none, 4=moderate, 7=very high)

Exhibit V-1: Q9+10/Asia Pacifi c: Degree to Which Companies Have Made and Will Make Changes to Respond to Digital Mobile Consumers (Scale of 1-7, 1=none, 4=moderate, 7=very high)


In looking at the scores that we compiled on eight industries in the overall degree of change on the five elements above (industries for which we had large-enough samples) we found that industrial manufacturers and telecommunications had changed the most, and government and energy/utility companies had changed the least on this qualitative scale. (See Exhibit V-2.)


Exhibit V-2: Q9+10, 1-5/Asia-Pacifi c: Comparing Industries in Degree of Change in Products and Processes in 2012 and 2015 to Respond to Digital Mobile Consumers

Exhibit V-2: Q9+10, 1-5/Asia-Pacifi c: Comparing Industries in Degree of Change in Products and Processes in 2012 and 2015 to Respond to Digital Mobile Consumers


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Findings: Asia-Pacific
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Europe: Winning the European Mobile Consumer: Internal Changes are Critical

Like their counterparts in North America, no single success factor stood out among the 14 we provided. And one issue – getting customer-facing functions to work in unison – finished second as it did in North America. (See Exhibit IV-10.)

However, an issue that North American companies rated fifth in importance topped our chart in Europe: reskilling employees to work quickly and effective with consumers who are interacting with a company through their mobile devices. This issue ranked at the top of the list (3.64 on the scale of 1-5). It underscores the importance of having customer service representatives armed and trained to operate in a world in which consumers demand better service from the touch of their mobile phone or tablet device. Just as in North America, creating a separate unit to focus on mobile consumers was at the bottom of the European list.


Exhibit IV-10: Q21/Europe: Key Success factors in Winning
Over Digital Mobile Consumers (Scale of Importance, 1-5)

Exhibit IV-10: Q21/Europe: Key Success factors in Winning Over Digital Mobile Consumers (Scale of Importance, 1-5)


 

Findings: Europe
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Who’s Spending the Most on Responding to the Mobile Consumer?

Many companies have spent in the millions of dollars individually on mobile apps, “big data” tools to analyze consumer data streaming through mobile channels, consulting expertise, and technology help to build and integrate mobile apps and mobile-oriented websites. We wanted to know what companies in North America, Europe, Asia-Pacific and Latin America were spending annually on all this. So we asked respondents to estimate what they would spend this year on technologies and consulting/IT services to respond to consumers who do business with them through mobile devices.

On average, companies in the four regions will spend between 0.14% and 0.24% of revenue to be mobile consumer-ready. To get a sense of that, for a $10 billion company, that would mean from $14 million to $24 million; for a $1 billion company, that would be $1.4 million to $2.4 million.

So what were the actual numbers? In North America, the companies we surveyed said they would spend an average $16 million on responding to mobile consumers. (See Exhibit II-9.) The number was higher in Europe — $20 million – which was similar to what Asia-Pacific companies reported ($22 million). Latin American companies estimated $14 million for this year.


Exhibit II-9: Q16/Global: What Companies Will Spend in 2012 on Technologies and Services to Respond to Digital Mobile Consumers (Not Adjusted for Average Revenue/Company in Region)

Exhibit II-9: Q16/Global: What Companies Will Spend in 2012 on Technologies and Services to Respond to Digital Mobile Consumers (Not Adjusted for Average Revenue/Company in Region)


We also asked them to predict what they would spend in three years (in 2015), and the answers were similar: between $22 million and $25 million per company in the four regions.

However, because the average-sized company differed from region to region, these numbers should be normalized. That is, bigger companies should be expected to spend more on mobility than smaller companies – as they would on just about every other business expenditure. To get an apples-to-apples comparison of company spending on mobility by region, we calculated ratios of mobility spending (in dollars) per $1 billion in revenue. (See Exhibit II-10.) These numbers tell a different story:

  • In 2012, Asia-Pacific companies spent far more on responding to digital mobile consumers than did companies in the other three regions. Per $1 billion in revenue, they spent an average $2.41 million vs. $1.43 million in North America, $1.59 million in Europe and $1.63 million in Latin America.
  • For 2015, the ratio of spending per $1 billion in revenue for companies in the four regions is expected to be higher. In North America, the ratio is predicted to be 1.98 (vs. 1.43 this year); in Europe, 1.76 vs. 1.59 this year; in Asia-Pacific 2.85 vs. 2.41 in 2012; and in Latin American 2.72 – a big leap from 1.63 this year.

Exhibit II-10: Q16a/Global: What Companies Will Spend in 2012 on Technologies and Services to Respond to Digital Mobile Consumers (Adjusted for Average Revenue/Company in Region

See Exhibit II-10: Q16a/Global: What Companies Will Spend in 2012 on Technologies and Services to Respond to Digital Mobile Consumers (Adjusted for Average Revenue/Company in Region


Based on these numbers, it looks like North American and European companies will be trying to catch up in spending with their counterparts in emerging economies of Asia-Pacific and Latin America. However, companies in the latter two regions are planning to hike their spending too.

 

Findings: All Regions
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