The iOS and Android platforms have brought the power of mobile apps to millions of consumers. A side effect of this revolution is the pressure on CIOs to launch consumer mobile service apps over and above the pressure to mobilize their existing employees. The temptation is to just quickly build an app instead of comprehensively thinking about a consumer mobile service.

Angry Birds is a fantastic app, full of sizzle. However, if it were to stop working, there is no phone number to call and you are on your own researching the Internet to find possible causes of failure. (Angry Birds is great, and thankfully, it doesn’t seem to ever stop working!)

Now compare that to the eBay mobile app. You have all the power of eBay within the app. You can bid, be notified and make purchases. The app may not have the sizzle of Angry Birds, but it has all the muscle of eBay’s platform behind it.

This is an important distinction for enterprises to consider as they launch mobile consumer services. Consumers want sizzle, but the service needs to also have the muscle to support the large number of users that may end up using it. Sizzle without muscle invariably fizzles.

Let’s say a utility company wants to improve its customer engagement and goes down the path of launching an app that provides information on outages. The company plans for 30,000 concurrent users, which is adequate for normal outages. Then, in comes a hurricane, which brings over a million users to the mobile service over an extended period of time. The company faces a dilemma: Does it change its hardware plan to accommodate such outlying peaks in capacity, design the system to scale automatically, or switch to alternate means of getting the message out (such as radio, TV, email and social media) in extreme circumstances? These are all good questions to ponder apart from the app itself, which brings me to the core requirements of launching a consumer mobile service.

When thinking of a mobile consumer service, consider how to:
• Handle multiple mobile channels, including smartphone apps, mobile web, SMS, USSD, etc.
• Scale from hundreds of thousands to millions of users.
• Execute channel-specific and other relevant business logic in the mid-tier, separate from existing applications.
• Support via Web channel customer self care, self-registration, customer support portals, etc.
• Provide standards-based mechanisms to connect to backend systems.

Taking this larger view makes it clear that the app on the phone is really the tip of the iceberg when launching a mobile consumer service.

Sybase has a history of successfully launching mobile consumer services for clients that include QTel Mobile Money, DBBL Mobile Money, Celcom Aircash, and MyClear MyMobile.

We’ve just announced that a new version of the platform used to build and run these services will ship at the end of March. It includes new capabilities that make it easier to build applications for SMS/USSD and tools to build apps for iPhone, Android, Blackberry and mobile Web. It comes pre-built with a series of use cases that support the common functions of account management, P2P transfer of airtime and money, international remittance, airtime top-up, bill pay and transfers. In addition, it has pre-built portals to manage customer registration, self-care and support, merchant registration, self-care and support, agent hierarchy, dashboard for operations and more. In short, it provides all the capabilities that provide both the sizzle and the muscle required for a successful mobile consumer service.

Consider: it’s not just the banks and telcos launching mobile consumer service apps. Companies in almost every industry, including utilities, retail, consumer products, oil and gas, are launching mobile applications for consumers. In many cases, the aim is to improve customer engagement and interact directly with end customers—sometimes for the first time, as many types of companies have not traditionally had that ability. For example, consumer products companies predominantly deal with distributors and not with end customers. With a mobile application, however, they can engage with their customers and collect data that can help with product planning.

The requirements I listed above are common across all industries considering a mobile service for consumers. The key is not getting trapped in the pressures of launching an app without thinking about it in the context of a mobile consumer service. And for this, I recommend a platform that provides the sizzle for excitement and the muscle for building reliable applications that can scale to meet consumer demand.

Late last year, Qatar Telecom (Qtel) extended its Mobile Money service with a fleet of self-service machines, similar to ATMs. The telco installed more than 200 throughout the country’s many malls that customers can use to pay cash into their mobile wallets—instead of having to go to an agent. Being able to cash in at a mall means consumers can do it easily as part of a routine trip.

Customers then use a USSD-based menu system on their phones and a six-digit personal identification number (PIN) to access the money in their mWallets. They can transfer funds to other Qtel mWallets, send international remittance, top up their own pre-paid mobile phone accounts, send airtime to others, or pay their monthly mobile bills.

Though the telco’s agent network is still the primary point of contact, providing customer service and cash-out services, the machines give customers more locations, 24/7 access, and an additional way to get cash in to their accounts.

For the telco, the Sybase Mobile Commerce platform provides a cost-effective solution to extend mobile financial services to customers who may be under-banked or even unbanked (dealing primarily in cash), thus missing out on the convenience of being connected into a financial system.

Like many countries in the Middle East, Qatar has two populations: a well-heeled citizenry that benefits from the region’s oil resources, and immigrants from developing countries (such as India, Pakistan, Bangladesh and the Philippines) that work service jobs.



Migrant workers without bank accounts find the Qtel service particularly useful, since the network of self-service machines give them an easier, more convenient and secure way to put cash into their mobile wallet. Once cash in is achieved, they are able to send money home, add airtime to their own prepaid mobile accounts, or send airtime as a gift, all via the mobile phone. Later this year, Mobile Money customers should be able to receive disbursements directly into their mWallets, making it unnecessary to cash in at all.

Qatari citizens, on the other end of the economic spectrum, can use the Mobile Money service to pay their monthly mobile bills—and will soon be able to make merchant payments and buy services using their Qtel mWallet.

With this offering, Qtel is providing a business service as well as a consumer one, giving small businesses the option to pay employees without having to write checks or move cash.

As more customers and businesses sign up for the service, I can see the mWallets easily replacing cash as a more secure way to send and receive money, and pay for all manner of goods and services throughout the country. I imagine we’ll see more self-service machines across the Middle East and Asia and other regions with large, under-banked migrant worker populations.

Will holiday shoppers bring mobile purchasing into the mainstream this year? They’re ready, according to a recent joint survey done recently by the Mobile Marketing Association (MMA) and my employer Sybase 365.

Almost two-thirds of U.S. consumers—62%—say they would be willing to make a purchase using their mobile devices if encouraged by a coupon, discount offer, text alert, gift card or loyalty program. That number is exciting enough on its own, but when we compare it to last year’s 32% positive response to the same survey question, we have a remarkable 30% increase in just twelve months.

Shoppers are ready, but what about retailers? Do they have the mobile purchasing systems in place to help complete the exchange? Unfortunately, the answer is no.

I recently downloaded a mobile shopping assistant application called ShopSavvy. Once you have it on your device, you use your camera to scan the barcode of a product, and ShopSavvy returns a list of both local retailers and online stores where you can buy the thing, as well as product reviews. I tried it out by scanning the barcode on my paper notebook, and ShopSavvy found it at Amazon, OfficeMax, and a few others. I clicked through to OfficeMax, but was right back to having a clumsy, miniature version of an e-commerce experience on my phone.

To be fair, ShopSavvy does offer a direct purchasing option with some merchants, which allows you to skip the web site and make purchases using the ShopSavvy wallet.

On the larger scale right now, mobile is great for comparing prices, and finding places to buy. But when it comes to actually making a purchase, mobile is usually not the easiest option. The desire to shop with our mobiles has increased, but most retailers haven’t yet matched the fast, intuitive experiences that customers are already used to from iTunes, the Apple App Store, Google’s Android Market, eBay and Amazon.

Another interesting result from our survey shows that even without the discounts, 56% of respondents said they would be likely to use their mobiles to assist with shopping, including finding store locations (38%), comparing prices (34%), researching deals and coupons (28%), finding product reviews (28%) or making a purchase (22%).

Nielsen reported in September 2011 that smartphones now make up 40% of all mobile phones in the United States. With more smartphones and tablets in consumers’ hands than ever before, there are more reasons—and more ways—to use mobile than ever before.

All these numbers are telling us that we’ll see a dramatic rise in mobile-assisted shopping this holiday season. In fact, this is borne out by data collected by ShopSavvy this past Black Friday, which shows a scan volume 535% higher* than the baseline scan volume of a normal day. Consumers have the devices, they’re ready to use them, and there are many ways that mobile can help: comparing prices, providing information and finding the closest retail outlet. However, we still need to make significant progress on the payment side of things—to get to the level of ease that iTunes offers—before mobile shopping goes mainstream.

* http://shopsavvy.mobi/blog/

With all the talk about mobile wallets these days, there’s also a lot of concern about security. If you lose your phone, and your wallet’s in your phone, isn’t that like losing your wallet too? No, it isn’t. Not in all cases. The Sybase way, with the mobile wallet in the cloud, mobility actually provides a whole new level of fraud protection.

For example, when I set up my mobile banking profile, I specified that I want to receive an SMS alert whenever there are transactions that originate from foreign countries, or are greater than $500. I now receive those alerts on my mobile phone. These kinds of alerts are simple service that could become a dramatic fraud prevention mechanism.

Here’s a real story to illustrate. A friend of mine took a cab home from the airport one night. On the way, she and the driver got talking: where she’d been on her trip, what she did for a living, that kind of thing, nothing out of the ordinary. In front of her house, she paid for the ride with her credit card. The cabbie took a carbon copy impression of the card with a slider machine, and got the CVV number from the back. The woman went inside, and the driver left.

The next day, the taxi driver ordered a laptop using the woman’s card details. He had it sent to her home address, because he knew from their conversation that she wouldn’t be home during the day, because she usually left for work in the morning, information that he had gleaned from their conversation. He tracked the package online, and when it arrived, he drove to her house and picked it up. And then he did it again. The woman only learned what was going on because she happened to get home early on the day the third computer was delivered.

If the woman had a mobile alert in place, it probably wouldn’t have taken three computers to discover the crime.

When consumers can activate alerts for their mobile wallets, credit and debit cards and other financial accounts, then the instant a thief’s first big transaction goes through, they receive an alert. Cardholders can call their credit card company or bank and have them freeze the account, and then call the merchant to let them know it’s been compromised.

It would—and does—cost the bank to send SMS alerts. But isn’t the cost worth it? Banks are already spending money on preventing fraud, and footing the bill when it does happen. Without alerts, a number of big charges can go through before anyone finds out. In fact, thieves today rely on that period of time, working quickly to get as much as they can before they’re discovered. With alerts, if someone is using your accounts to make purchases, you know immediately, and can text or call back to prevent the crime.

Sybase 365 provides this capability to banks and mobile operators today, so they can reach their customers with alerts no matter where they are, at home or roaming. Additionally, with two-way interactive SMS conversation, a purchase request confirmation can be secured from a customer, thus reducing chances of fraudulent use. Right now, subscribers of the mpass system in Germany (powered by the Sybase 365 mobile platform) receive an SMS requesting purchase confirmation when they make an online purchase from participating merchants. Once a customer answers YES, payment is released. Customers get the peace of mind that comes from authorizing each and every transaction that is performed online with mpass. This goes above and beyond the security offered by other payment mechanisms today while preventing fraudulent use.

I recently learned about a sweet little mobile banking application called WishList. You download it to your phone, and type in all the stuff you’d like to buy: furniture, vacations, a house, new car, etc. As you save toward those things, you can allot amounts of money to each. WishList connects to Facebook so that your friends can see your progress. Watch a video about the app here.

This is such a great development, because it shows how to combine Facebook with personal financial management, and make it fun. The bank behind WishList isn’t charging for the app, or selling anything directly, but it is making a name for itself among the younger generation, and building a friendly, fun social media brand.

Banks around the world should sit up and take notice. Many are already working on how to incorporate social media into their mobile banking strategy, because that’s where all their customers are hanging out. A handful of banks around the world are using Twitter to provide customer service, make announcements and circulate news. Even more are making fan pages on Facebook to do the same, trying to get customers to “Like” them.

That’s all well and good, but it’s not going to change the game or enroll customers in large numbers. But something like the WishList app—incorporating the concept of personal financial management and making it fun—just might.

Why is it important for banks to be on social media? Because it’s so easy to communicate with a group of people through your social network, free of charge. In the future, banks may be able to reach more people through social media than through a traditional advertising campaign. Also the playing field is level: the biggest bank in the world gets the same footprint as the smallest. It could also become a nice test bed to launch new products and services and get feedback. The possibilities are endless.

Several weeks back, Apple announced the integration of Twitter into iOS5. That’ll make it easier for developers to incorporate a Twitter feed into applications. For a bank, that could mean that its Twitter feed shows up in its clever social personal finance application.

As I discussed in my April 25th post, the mobile money players were supposed to collaborate to create an ecosystem before mobile commerce could take off. However, in the North American market, we’ve seen just the opposite, with mobile payment methods from merchants gaining popularity with consumers, and that causing competition among merchants, banks and telcos. Eventually, I think we’ll see partnerships and cooperation that will create the ecosystem, but right now, everyone is doing their own thing and competing to enroll customers. That’s causing tension.

Social media just may be the thing that can help establish this ecosystem. Banks, merchants and telcos are all incorporating it into their strategy. Apple is incorporating it into its iOS. Consumer behavior has already changed with the rise of smartphones and other mobile devices, both in terms of making payments (see my July 5th post for more on that), and also sharing information. For example, I went to a U2 concert recently and got stuck in traffic for 45 minutes, but because so many friends were there on Facebook, my wife and I could see pictures of the opening band and hear about what songs they were playing. Once inside, it seemed like everyone around me was on Facebook, posting pictures and updates.

The net result is this: Instead of trying to change consumer behavior, businesses now have to accommodate changed consumer behavior and do what their customers are doing. That’s why social media is going to be important: because that’s what our customers are telling us.

Of the 160 million people in Bangladesh, a sovereign country that sits between India and Southeast Asia on the Bay of Bengal, just 13 percent have bank accounts. Yet 45 percent use mobile phones.

Why the wide split? Access. While the nearest bank branch may be a long way away, mobile phone agents are widely distributed, the devices themselves are affordable (particularly pre-paid) and service coverage is expanding.

We see these kinds of numbers throughout developing nations for the same reasons, and they all spell one thing: a tremendous opportunity to bring basic banking services to the unbanked via mobile phones.

Dutch-Bangla Bank Limited (DBBL), one of Bangladesh’s largest banks, has the largest ATM network and electronic processing system in the country, and is also the largest corporate donor. Combining its philanthropic mindset and willingness to put new technology to work, DBBL is in the process of launching a mobile banking initiative using the Sybase 365 platform.

For Sybase 365, this is also a milestone. It’s one of our first bank-led implementations, bringing mobile financial services to the unbanked (and underbanked), and helping to realize the vision of financial inclusion that governments in emerging markets across Asia, Africa and Latin America are promoting. People who don’t have access to banking services, or haven’t had access in the past, can now get access because they have mobile devices.

I think bank-led initiatives have a better chance of working out because a) the regulatory aspect is covered by the bank b) it’s a good customer acquisition strategy without having to open physical branches to provide service, c) awareness for the brand increases as service gets used d) banks have the financial wherewithal to see such a project through, e) it aligns with what governments want implemented for citizens and finally, f) banks can easily extend the service to handle disbursements and remittances.

For the consumers, this service is an order of magnitude improvement in access to financial services and convenience, especially when it comes to accessing account information, transferring money, putting cash in and taking cash out. The bank’s plans for the next phase of services include mobile airtime top-up, merchant payment and micro financing—all from consumers’ mobile devices.

DDBL’s service will allow local and international money remittance to Bangladeshi expatriates who work in other countries and send money home. The receiving family member can withdraw finds at the nearest participating retailer or cash point. The service will be available on all mobile devices with subscription to any of the six mobile operators of Bangladesh.

That network agnosticism is key to being able to reach the maximum number of potential customers, as the business model depends on serving the wide base of the economic pyramid in Bangladesh. At Sybase 365, we’re committed to building relationships with more partners in developing markets, helping those local banks find economical ways offer accessible and secure mobile commerce services.

Mobile money is truly something that can change the world for the better. The early numbers from DBBL’s pilot program are in, and the great thing is that deposits are greater than withdrawals. That may be further proof of something we’ve seen in other emerging markets: when people get access to a simple mobile bank account, they start to save—often for the first time.

Banking is going mobile. There’s no doubt about it. Mobile phones and tablets are replacing the PC. So far, however, banks have been primarily aiming their mobile banking initiatives at consumers. That’s leaves a large, untapped opportunity for pioneering banks to offer mobile services to corporate customers.

There’s high demand, according to an Aite Group survey of over 300 treasury professionals conducted in late 2010. Two-thirds of those surveyed said that they would be at least “somewhat likely” to use basic mobile banking services if their bank offered them. Over 40 percent responded that they would be “likely” or “very likely.” Sounds like an opportunity to me.

Corporate customers are looking for information and the ability to execute. According to a February 2011 Treasury Strategies Incorporated survey, treasury professionals want to (in order of priority) view balances, release payments, authorize payments, confirm trades, execute trades and have access to administrator functions.

It makes sense. Business—especially small business—can go on hold due to key executives being inaccessible or out of the office. Payroll release or wire transfers over a certain amount may need approval before they can go through. Mobile banking would allow execs to review and approve payments remotely.
Itinerant small business customers would like the capability to move funds across accounts, process a payment and handle positive pay decisions, all without having to get to an office and log in.

Right now, banks have the opportunity to gain new customers by offering mobile services before their competitors, improve existing customer relationships with the direct communication channel mobile provides, and generates additional revenue streams through new products’ fees.

For instance, a small business owner who provides services has to rent a hand-held terminal to process payments. He ends up paying an annual fee for the privilege of using the equipment to accept credit cards.

However, technology exists today that allows this small business owner to use take a picture of a customer’s credit card with the camera on an iPhone, and process the payment. Similarly, with remote deposit capture, the business owner can deposit a check into his account or send an invoice.

At this point, it’s really up to the creativity of the banks to offer new services that make life easier for their business customers. The Sybase 365 Corporate Mobile Banking solution gives banks the ability to provide the kinds of solutions their business customers want within a matter of months.

RBS Citizens bank launched its accessMOBILE solution, built on the Sybase 365 Corporate Mobile Banking solution, in November of 2010. Leveraging the bank’s existing online platform, and taking just 10 months to complete, accessMOBILE is available to customers using iPhone. Six months later, customers had downloaded the app 2,500 times, and were providing rave reviews. First Tennessee Bank launched its own full-featured mobile offering in June, also built on the same Sybase 365 platform.

The demand for corporate mobile banking very definitely exists—and will likely grow. The benefits are compelling, for banks and their customers. The platform is available today. Forward-thinking banks are already doing it.

The window of opportunity is right now. It’s time to offer corporate mobile banking or get left behind.

I keep hearing people ask why mobile payments haven’t taken off in the U.S. My answer: “They have!” But many of us haven’t realized it yet.

When you use your mobile device to purchase and acquire something, that’s a mobile payment. By that definition, I’d say that everyone who’s ever downloaded an app to their mobile device has already done it, because the act of downloading requires a kind of payment. Even if no money is exchanged, the consumer must still enter their account credentials, just as if the app costs money.

At this point, we all expect the payments for those apps to be handled via our mobile. The notion is embedded in our minds, and our behavior has changed accordingly. We set up an account through iTunes, eBay, or another merchant, and then make purchases through our devices. We already expect this kind of simplicity. Apple’s announcements related to iCloud and not requiring tethering an iPhone to PC, will only further the advance of mobile payments.

Yet still, people are looking to telcos and banks, asking when we’re going to get a mobile payment infrastructure, and forgetting that mobile payments have already taken off via smartphones, and merchants have taken the lead. Telcos and banks are just now beginning to recognize it, hence the push for cloud wallets, NFC payments, enhanced operator billing, etc.

However the key to this stealth progress of mobile payments has been enrolling customers. Apple signed up millions of customers through iTunes, and now they leverage those accounts for selling not only music, but also apps, movies and TV shows. With the innovation that’s come out of Cupertino, CA in the last several years, I won’t be surprised if Apple continues to expand what it sells through iTunes accounts. As new mobile payment systems roll out, they won’t be compared to writing a check or swiping a card. They’ll be compared to the easy, elegant iPhone and Android process. Those mobile payments are so intuitive, that consumers barely realized they were doing something revolutionary.

Now that the mobile payments horse is out of the barn, the important thing to note is that the hardest thing—changing consumer behavior—has already been achieved. However, this is very specific to the North American market. We will continue to see proliferation of telco-sponsored mobile wallets in other parts of the world as competition heats up to enroll those customers.

What if a bank owned a telecommunications company? I’ve been pondering this interesting question lately. Let me lay out the important pieces.

First, telcos have larger customer bases than banks. If a bank owned a telco, the bank would suddenly have a captive set of customers to which it could market products.

Second, in most countries, people use prepaid phones. They buy airtime from their telco’s agents, and the stored funds decrease as you use the minutes. However, since telcos aren’t banks, they cannot allow consumers to use the prepaid funds for other services. Allowing such use would mean telcos cross-over into a deposit taking institution, which would require them to be regulated like banks..

But, if a bank owned a telco, the bank could treat these types of accounts in a more flexible way, issuing debit cards against them, backed by the funds in the account. Customers would be able to use the cards to make payments wherever debit or credit cards are accepted, or to withdraw cash from ATMs. The telco would host a mobile wallet system to authorize the transactions, and could even issue the cards (or virtual cards) via a mobile interaction.

Getting back to my first point, if a bank owned a telco, it could make these basic banking services available to a much larger user base, many of whom may not have access to stored-value accounts or credit cards otherwise. For consumers without a traditional bank account, this would allow them to participate in the financial system, and provide convenience, as people can simply top up one account and use the funds for multiple purposes.

What’s the business case? First, when people use the card, the bank collects an interchange fee for the transaction. Second, the numbers make it work. If a bank tried to reach an audience as large as a telco’s customer base, even with a huge marketing budget, they probably wouldn’t be able to sign up enough people to cover the cost. However, if they were able to issue a card against a mobile pre-paid account, you suddenly have a big enough customer base to make the offering worthwhile. Beyond a revenue-generating game, it becomes a customer-acquisition game. That’s why it’s such a sweet thing.

Mobility is transforming our world, and it will continue to do so, in more ways that anyone can imagine today. Just as mobile phones forever changed our ability to communicate, mobile banking, payments, remittance, vouchers, marketing and apps will forever change business: the way money changes hands and the way enterprises and customers interact. Even if your company isn’t planning to be directly involved, it’s important to understand that mobile commerce will affect you and the way you do business.

Sybase 365 will release its Mobile Commerce Guide 2011 soon, which provides a broad survey of the state of mCommerce today. It’s full of articles by industry experts from all over the world, telling the story of mCommerce at work with proof points, case studies of real customer deployments, charts and illustrations, projections, forecasts and viewpoints from banks, operators, independent consultants and industry analysts. Reading it will bring even a novice up to speed.

The article I contributed, “10 Lessons for mCommerce Implementations,” shares lessons learned from the world’s most successful mCommerce deployments: paybox in Austria, Compass Bank in the United States, mpass in Germany, Celcom in Malaysia and others. The world is witnessing a explosion in smartphones that will bring about a sea change in terms of applications, capabilities and services available to the consumer. Operators and banks are in a race to enroll customers and offer mobile commerce services. The lessons learned will serve as a baseline for successfully launching new services. Before this space really takes off, we’ll continue to learn, and we’ll continue to share those on this blog.

Get your free copy of the Mobile Commerce Guide here.