Who has the bragging rights for spending the most on technologies and services to respond to the digital mobile consumer? Which industries are investing the greatest amounts? Energy, telecommunications, and airlines are at the top of the chart, spending an average $27 million to $31 million per company on consumer mobility annually. (See Exhibit VII-9.)
Exhibit VII-9: Q16/Global Industries: Average Company Spending in 2012 on Technologies and Services to Respond to the Digital Mobile Consumer (in US $ Millions)
Two industries are at the bottom of the chart: transportation services/logistics and food and beverage manufacturing. Notably, retailers’ spending is less than the cross-industry average — $13 million vs. $17 million per company.
But what about future spending? (See Exhibit VII-10.) By 2015, the industries whose projections would put them in the lead are:
Airlines ($37 million per company in 2015)
Telecommunications ($35 million)
Computer ($34 million)
Exhibit VII-10: Q16a/Global Industries: Average Company Spending Projected for 2015 on Technologies and Services to Respond to the Digital Mobile Consumer (in US $ Millions)
At the bottom: food and beverage ($10 million), transportation services ($11 million), and media and entertainment ($12 million).
Two industries garnered the top spots for most consumer mobile apps produced to date: media and entertainment, and telecommunications services companies. Each industry claimed to have developed more than 30 consumer apps. (See Exhibit VII-7.)
In the next tier were computer (hardware and software), energy, and consumer products companies, with from 18 to 25 consumer apps on average in each sector. In the middle of the pack were banks, government, travel and automotive.
At the bottom were airlines (perhaps they have deployed just a few but heavily used mobile apps) pharmaceuticals, and food and beverage companies.
Exhibit VII-7: Q14, 1-a1/Global Industries: Number of Mobile Apps Developed for Consumers to Date, and Additional Apps Planned by 2015
The computer industry appears to be playing catch-up over the next three years, estimating it will develop an average 41 additional consumer mobile apps per company by 2015.
In developing mobile apps to be used by their sales forces (to boost consumer sales), the industries in the forefront with the most apps to date were energy, telecommunications, utilities, computer, and automotive. (See Exhibit VII-8.) Energy and computer companies plan to create the most additional apps for their sales force over the next three years.
Exhibit VII-8: Q14, 2-a2/Global Industries: Number of Mobile Apps Developed for Sales Force to Date, and Additional Apps Planned by 2015
We compared our global industry sectors on the percentage of marketing, sales and service transactions with consumers using mobile devices out of total transactions:
The percentage of total sales transactions (number, not revenue amount) that came through consumers’ mobile devices
The percentage of marketing campaigns they designed just to be viewed on mobile devices out of total marketing campaigns
The percentage of post-sale service interactions with consumers who inquired through mobile devices out of total service interactions
Three industries were at the top on all three measures: airlines, energy and telecommunications. (See Exhibits VII-4, 5 and 6.)
In consumer purchases, the airlines we polled estimated that 61% of consumer purchase transactions of flights are made through mobile devices, and that the number would reach 76% by 2015. Energy companies said half of all consumer purchases are made through mobile devices today, and that number would exceed 60% in three years. And telecommunications said 48% of consumer purchases were being made these days through mobile devices, and they predicted they would rise to 60% by 2015.
Industries on the low end were consumer products (14%), health care services (26%) and pharmaceuticals (26%). The low consumer products rate is no doubt a reflection of the fact that most consumers purchase their products through retailers – not direct through the consumer product manufacturer. In many regions of the world, government pays for healthcare services, as well as for pharmaceuticals. So perhaps lower mobile purchase-to-total purchase ratios should be expected in these sectors.
Exhibit VII-4: Q11+11a/Global Industries: Percent of Consumer Purchases Made Through Digital Mobile Devices (2012 and Projected for 2015)
Who’s on top in marketing to consumers through mobile devices – at least, which industries are funneling more of their marketing campaigns through the little screens of smartphones and tablet devices? (The numbers here may bear little resemblance to data on the largest mobile advertisers. Our numbers only look at mobile marketing campaigns as a percent of total marketing campaigns.) (See Exhibit VII-5.)
The global industries with the highest proportion of mobile marketing campaigns to total marketing campaigns are (once again) airlines, telecommunications and energy companies. The ones with the lowest ratio are consumer products, industrial manufacturing, transportation services, and food and beverages.
Exhibit VII-5: Q12/Global Industries: Percent of 2012 and 2015 Marketing Campaigns Designed Exclusively for Consumers’ Digital Mobile Devices
So which industries are consumers contacting most frequently after a purchase using mobile devices? The airlines, energy, telecommunications and government sectors (state, federal and local) report the highest percentage of service transactions (out of their total service transactions) coming from digital mobile consumers. (See Exhibit VII-6.) Airlines estimate that 56% of service transactions are with consumers who use mobile devices. They predict the percentage to reach 81% in three years. Energy and telecommunications are a distant second and third (42% and 41%), with government ranking fourth at 39% of service interactions coming through mobile devices.
Industries with the lowest mobile-initiated service interactions are consumer products, industrial manufacturing, and media and entertainment. All say that no more than 20% of their service interactions are coming from consumers using mobile devices.
Exhibit VII-6: Exhibit VII-6:Q13/Global Industries: Percent of Customer Service
Transactions (Post-Purchase) Conducted with Consumers Who Use
Digital Mobile Devices (2012 and 2015)
As we’ve reported in previous section, we asked survey respondents for a qualitative assessment of the changes they’ve made to date, and plan to make by 2015, in their products and processes. On this 1-7 scale, the global industries that indicate the greatest degree of change are those that:
a) Can deliver their product directly through a mobile device (e.g., media content and telecommunications services). Telecommunications had the highest degree of change in products and processes to date to respond to mobile consumers – 5.42 on our scale of 1-7. (See Exhibit VII-2.) Telecommunications scored much higher than the other sectors on this scale. Since they sell the very products (mobile devices and wireless services) that enable consumers to do business electronically when they’re on the go, it’s understandable that telecommunications have made major changes in their products and in the way they deal with consumers in marketing, selling and servicing those products. Media and entertainment companies were fourth, at 4.82. This industry, too, is increasingly delivering its product to consumers’ mobile devices: movies, sports, news, videos, and other digitized content.
b) Must deliver a significant amount of information to consumers so they can better understand what they’re purchasing (retail and travel/hospitality/leisure). Companies in these industries generally don’t deliver their products through mobile devices. Retailers sell consumers physical goods, and travel and hospitality firms provide hotel and other accommodations. Retailers and travel providers finished second and third on the scale of change. Both industries can be seen as businesses that provide information and access to products and services. Retailers, of course, stock their shelves largely with products that they don’t make themselves. Their websites and salespeople help consumers understand those products. Travel agencies provide information to consumers who need hotels, dining and other services when they’re on vacation or on business – as well those services in some cases. Both industries, therefore, have the opportunity to provide consumers with critical information for making their purchases and the ability to make those purchases.
Close behind (at fifth) on our scale was the energy industry. Oil companies for many years have been at the forefront of mobile payments. For example, Exxon Mobil in the US introduced in 1997 a device called Speedpass that placed an RFID chip into a keychain for electronic payment at the pump. No doubt that 15 years later, such energy companies are gearing up to help mobile consumers use modern technology to make their purchases even more efficient.
The banking, transportation, computers and pharmaceuticals companies also had higher than average scores on this scale. (The average score across industries was 4.60.)
Exhibit VII-2: Q9/Global Industries: Cumulative Average Changes to Products, Marketing, Sales, Service and Supplier Processes to Win the Digital Mobile Consumer
(scale of 1 to 7)
The industries with below average scores included some that have little direct contact with consumers: industrial manufacturing, food and beverage makers, and automakers. These industries largely sell through retailers or dealers, and thus may believe that responding to consumers who use mobile devices is largely the work of those retailers.
Curiously, the airline industry was near the bottom, just above government, perhaps suggesting that the sector long ago had adapted to the demands of the digital mobile consumer.
But how do these 17 industries view the changes to products and processes they must make in the near future to respond to digital mobile consumers? Do they feel they need to make more changes, essentially the same, or less?
Across all the industries we surveyed, the average amount of change on this 1-7 scale was predicted to increase by 2015, to 4.93 from 4.60. (See Exhibit VII-3.) Industries that foresee having to change the most:
Telecommunications services companies (5.52): This isn’t a surprise given they are in the epicenter of the digital mobile revolution.
Travel, hospitality and leisure (at 5.24): The on-the-go consumer increasingly wants or needs to make or change his travel plans while on the road.
Media and entertainment (5.23): Mobile devices are becoming a key channel for their content.
Industrial manufacturing (5.20): This may reflect how much consumers can spend on big-ticket hard goods: appliances, lawn and garden equipment, etc. Maybe these industries believe consumers will increasingly research their products through a mobile electronic device.
Retailers (5.15): This sector is the main channel to the consumer for many consumer product manufacturers, from apparel to appliance makers. Retailers increasingly must deal with “show-rooming” – consumers who walk into their stores to get the look and feel of a product and then buy it online someplace else.
Banking/financial services (5.11): Of course, they are at the center of the whole mobile payments scene. But their influence on the digital mobile consumer goes far beyond that – to being the place where the consumer who’s in motion can check on his investments and make changes.
Exhibit VII-3: Q10/Global Industries: Cumulative Average Changes by 2015 to Products, Marketing, Sales, Service and Supplier Processes to Win the Digital Mobile Consumer
(Scale of 1 to 7)
Industries reporting the greatest changes to date to win over the digital mobile consumer: telecommunications, retail, travel and media & entertainment
Airlines, telecommunications and energy companies report the highest proportion of marketing, sales, and service interactions with consumers using mobile devices (as a percent of total consumer interactions)
Energy, telecommunications and airlines are spending the most this year to win over the digital mobile consumer (from $27 million to $31 million per company)
Our 664 surveys from North America, Europe, Asia-Pacific and Latin America gave us a sufficient sample to explore 17 industries, from airlines to automotive manufacturing. The exhibit below shows the number of respondents.14
Exhibit VII-1: Q2/Global Industries: Number of Surveys Per Industry (Combined Across Four Regions of World)
In this section of the report, we have rolled up the data by industry from across the four regions, meaning these sector findings represent the results of industries on a global basis. We will compare these 17 global industries along a number of dimensions.
Asia-Pacific industries that spend the most annually on technologies and services (consulting, systems development and integration, etc.) are three: energy/utilities, telecommunications, and industrial manufacturers. Companies in all three industries on average will spend more than US $25 million this year on the ability to respond to the digital mobile consumer. (See Exhibit V-11.)
Industries spending the least in this region are retailers ($6.7 million in mobile investments per company), computer ($9.4 million) and government agencies ($17 million).
Exhibit V-11: Q16/Asia-Pacific: Annual Spending on Technologies and Consulting/
IT Services to Respond to the Digital Mobile Consumer (2012) (in US $millions)
By 2015, the industries whose companies expect to spend the most are industrial manufacturing ($41 million per company), energy & utilities ($39 million) and telecommunications ($32 million). (See Exhibit V-12.) Retailers ($5 million) and computer companies ($14 million) are predicting the lowest annual spending among the industries we surveyed.
Exhibit V-12: Q16a/Asia-Pacific: Annual Spending on Technologies and Consulting/
IT Services to Respond to the Digital Mobile Consumer (Projected for 2015)
(in US $ millions)
We asked companies in Asia-Pacific about the degree to which they were marketing, selling and serving consumers after the sale through mobile technology. In purchase transactions, the percentage was the highest of the four regions: 50% today, with expectations of reaching 61% in three years. (See Exhibit V-3.)
Exhibit V-3: Q11/Asia-Pacific: Measuring the Impact of the Digital Consumer Across Industries
Broken down by industry, the sectors in the lead were energy/utilities, government and computer (hardware and software). The sectors that were trailing were retail, industrial manufacturing, consumer products, and banking. All of these sectors said their consumers made less than half their purchasing transactions through mobile devices in 2012. (See Exhibit V-4.)
Exhibit V-4: Q11/Asia-Pacifi c: % of Total Consumer
Purchases Through Mobile Devices (2012)
As for 2015, the same four industries with the greatest number of consumer purchases made through mobile devices in 2012 expected the percentage to climb even more. And even industrial manufacturers expect that most consumers (61%) will be purchasing their products using mobile devices in three years (Exhibit V-5).
Exhibit V-5: Q11a/Asia-Pacific: % of Total Consumer
Purchases Through Mobile Devices (Projected for 2015)
Asia-Pacific companies are also oriented toward marketing through mobile devices. Government agencies and energy/utility sectors have the highest percent of total marketing campaigns through mobile devices (65-66%), while consumer products and industrial manufacturers have the lowest (27-32%) this year. (See Exhibit V-6.)
Exhibit V-6: Q12/Asia-Pacific: % of Total Marketing Campaigns Designed
Exclusively to be Read by Consumers Using Digital Mobile Devices (2012)
By 2015, these industries expect to be conducting many more marketing campaigns through mobile devices as a percent of total marketing campaigns (Exhibit V-7). The leaders will be government, computer, and telecommunications companies. Asia-Pacific retailers and CPG companies don’t expect to shift a similar percentage of their marketing campaigns to mobile devices.
Exhibit V-7: Q12a/Asia-Pacific: % of Total Marketing Campaigns Designed Exclusively to be Read by Consumers Using Digital Mobile Devices by 2015
A similar pattern can be seen in post-purchase customer service transactions (Exhibit V-8). The industries whose consumers use mobile devices to interact most frequently (that is, those industries with the highest percentage of service transactions that are conducted through mobile devices) are government, energy/utilities and telecommunications. Industrial manufacturers and retailers report the lowest percentage of total service transactions from consumers using mobile devices.
Exhibit V-8: Q13/Asia-Pacific: % of Total Customer Service Transactions
That Consumers Conduct Through Digital Mobile Devices (2012)
By 2015, the Asia-Pacific industrial manufacturers that we surveyed expect that to change dramatically (Exhibit V-9). By then, they predict that 60% of their service transactions will be with consumers using their mobile devices – a nearly doubling in percent of service transactions from 2012. But the region’s retailers still see the number of mobile consumers calling or clicking their mobile devices for service after the sale to remain relatively low – at least compared with other industries.
Exhibit V-9: Q13a/Asia-Pacific: % of Total Customer Service Transactions That
Consumers are Expected to Conduct Through Digital Mobile Devices by 2015
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)
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
Asia-Pacific companies say more than half of consumers’ purchases are done through mobile devices. In addition, the companies estimate they design nearly half their marketing campaigns for mobile devices and that consumers conduct nearly half their service interactions with them through such devices.
Among eight industry sectors, industrial manufacturers indicate making the largest degree of change (on our seven-point scale) in products and processes to attract and keep the business of the digital mobile consumer – larger than the Asia-Pacific retailers surveyed.
Energy / utilities, telecommunications services and industrial manufacturing companies are making the largest investments in being responsive to digital mobile consumers.
Three European industries reported spending far more this year on catering to the digital mobile consumer than the other industries we survey (Exhibit IV-9):
Automotive (US$51 million)
Telecommunications (US$37 million)
Consumer products manufacturing–food, beverages and durables (US$33 million)
The average across industries was US$20 million in spending per company in 2012. In 2015, the average increases but just barely, according to the forecasts of the companies we surveyed, to $22 million. However, some industries plan to invest more than the average then:
Automotive (US $52 million)
Telecommunications (US$46 million)
Consumer products manufacturing ($33 million)
Exhibit IV-9: Q16+16a/Europe: What Companies are Spending on Mobile
Digital Technologies and Service to Implement them (US $ millions)