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Archive for December, 2011

Tis the season to be mobile

Tarik Husain | December 22, 2011 in Uncategorized | Comments (0)

While traditional, ‘bricks & mortar’ retailers are bracing themselves for a tough Christmas, online and mobile channels are experiencing unprecedented growth.

The proliferation of smartphones and tablets as well as more ubiquitous 3G coverage combined with demographic and lifestyle factors, means consumers are increasingly willing to do their Christmas shopping on a mobile device.

A recent Sybase 365 survey conducted in conjunction with the Mobile Marketing Association found that more than half of Americans (62%) would be willing to make a purchase on their mobile device this holiday season if prompted by coupons, discount offers, text alerts, gift cards or loyalty points.

This presents a significant increase compared with a similar Sybase 365 survey a year ago, when only 32% of respondents said that mobile incentives would encourage them to make a purchase on their device.

While smartphone penetration in Asia Pacific as a whole is behind the US and Europe (Nielsen puts it at just under 20%), there is a lot of interest in upgrading, especially with Android devices bringing smartphones and tablets into the reach of Asia’s aspirational middle class.

It is also important to remember that Asia Pacific is a region of great diversity – some markets such as Singapore and Australia already have some of the highest smart device penetration rates in the world, making them an ideal test bed for mobile commerce and mobile marketing.

Mobile Ad network InMobi found in its recent Mobile Insights Report a strong correlation between mobile web browsing and consumers’ willingness to buy goods and services on their mobile. According to the report, a whopping 80 percent of Asian mobile Internet users already indulge in mobile shopping.

The report identified music/movies/games (43%), consumer electronics (24%), travel (12%), and apparel (11%) as the most popular products already being purchased from mobile devices.

Mobiles are also great for comparing prices, and finding places to buy. And as a recent PayPal study highlighted, a quick and easy purchase from a work computer or mobile phone can often be preferable to using your lunch break to visit the
shops (You might want to use your personal mobile if you have a large family to shop for. Three quarters of companies monitor Internet use at work.)

Undoubtedly shoppers are ready, but what about retailers? Unfortunately, when it comes to actually completing a purchase, mobile is usually not the easiest option. All too often mobile payment options are not yet available, insecure or inconvenient to use.

To truly harness the power of mobile commerce, more needs to be done to create a smooth shopping experience that encompasses the entire purchasing lifecycle from browsing, selecting and paying for goods and services regardless of device type or carrier.

On a more personal note, thanks for reading my blog this year. Any comments, ideas, feedback would be appreciated. Above all, I wish you all a merry Christmas and a Happy New Year!

India ’s $350b mobile payment & banking pie

Tarik Husain | December 14, 2011 in Uncategorized | Comments (3)

A colleague of mine recently travelled to Mumbai, India for the Mobile Money Southern Asia Conference & Expo, and returned to Singapore full of new insights into the subcontinent’s booming mobile payments market.

India is set to become the world’s most populous country in 2030. Currently second only to China in population – the South Asian nation grew by 18m in the past decade alone. With 1.21b people, India’s population is now nearly equal to the combined populations of the United States, Indonesia, Brazil, Japan, Bangladesh, and Pakistan.

According to Boston Consulting Group, there are already 771m mobile subscribers in India, with 548m considered to be active, compared with the 240m people holding bank accounts. Most of the people in urban India have bank accounts but 90-95% still mostly use cash for their day to day needs.

While mobile commerce might be still nascent in the country, there is a tremendous opportunity in servicing both urban elites and the large numbers of the un- and under-banked in rural India via the mobile channel.

BCG’s analysis suggested mobile payment and banking transactions would reach $350bn by 2015, measured against approximately $235bn of credit and debit card purchases at present. Peer-to-peer remittances are expected to deliver $70bn by 2015, mostly as people in metropolitan hubs transferring funds to their families in rural areas.

Transaction volumes and fees might be small, but anticipated economies of scale have triggered a wave of notable alliances between banks and telco operators in India. (WARC noted the following recent partnerships: Bharti Airtel with the State Bank of India, Vodafone and ICICI Bank, Idea Cellular and Axis Bank.)

Another company that is keen to get a piece of the pie is Nokia. The handset manufacturer has started shipping mobile phones in India preloaded with its banking application, based on the Obopay mobile payment platform, in a deal with the Union Bank of India.

Considering India’s sheer seize as well as geographic and cultural diversity, it’s hard to imagine a national mobile payment scheme in India any time soon as we find in smaller countries like Austria today.

I would rather expect a number of payment ecosystems to co-exist for a significant period of time, until regional leaders emerge, possibly along historical and cultural fault lines.

It’ll be also interesting to see if any home grown players founded by India’s well educated and entrepreneurially minded IT community will be able to capture significant market share.

One thing is certain: As India cements its position as an economic powerhouse on the world stage, greater financial inclusion via the mobile channel will have a positive flow on effect on productivity, innovation and living standards.

What are your predictions for India’s mobile payment and banking market for 2012 and beyond?