ITEC0722: Mobile Business and Implementation Suronapee Phoomvuthisarn, Ph.D. suronape@mut.ac.th การใช้งานและธุรกิจบนอุปกรณ์เคลื่อนที่

Background Brief Dr. Suronapee Phoomvuthisarn Research interests PhD in CSE, University of New South Wales, 2011 National ICT Australia (2008 - 2011) Research interests Software Architecture , Service Economics, Trust Computing Work History: Mahanakorn University of Technology (Since 2007) Position: รองคณบดีฝ่ายกิจการนักศึกษาและประชาสัมพันธ์ http://www.it.mut.ac.th/new/index.php/personal/view/9 Email: suronape@mut.ac.th Room: Q305

Course Introduction Class Objectives Lecturer in charge Overview of mobile business; How to generate revenue by applications on mobile devices Lecturer in charge Suronapee phoomvuthisarn, Ph.D. (1-7) Suebtas Limsaihue (8-15) Materials Lecture notes iOS development lab such as in-app purchase implementation Analytics tools such as Hadoop

Course Outline Module 1 (before midterm) Mobile Business Models Marketing Concepts and Branding Digital Marketing and its Channels Market Research on Mobile Apps’ Trends How to write a business case Effective Brand Strategies Presentation - Your Mobile Application and its Strategies

Course Outline (2) Module 2 (after midterm) Marketing Analytics Lab (x4) StoreKit Framework Making AppleStore Purchases iAd Framework Implementing iAds Presentation

Grading Policy Exercises / Group Discussion / Quiz - 10% Midterm Exam - 35% Presentation - 20% Final Exam – 35%

Why study Mobile Business? The advantage of using “Mobile” devices Portable Always on Personal Remote access Localization Let’s explore trends of mobile usages

Worldwide Mobile Phone Sales in 2013

Worldwide Smartphone Sales in 2013

Start Thinking Mobile Business Which applications can be sold to the customer? Who is your customer? Who are the target users? Who are your competitors? How many are they? Pricing? How will you earn money? What are your strategies and channels to brings app to customers?

Mobile Applications

Traditional Steps of Running a Business The goal of the commercial company is to maximize profits High volume and cost reductions Key performance indicator Market Share Growth through extending the product taking our current product and bringing it to new customers coming up with new and different products seem fairly different from each other The competitive advantage: product expertise Product-oriented organizational structure This is the product-centric approach to business

Galbraith (2005), Designing the Customer-Centric Organization

Challenges in Product-Centric Approach Technology-enabled product development –> commoditization Technology-enabled information flow -> smart customers Technology-enabled delivery -> Products are now available everywhere

Examples IBM (International Business Machines) Develop certain kinds of computer machines (Old days ) (product -centric) In 1990s being a trusted advisor (these days) IBM achieves higher margins as a solution provider This expertise doesn't Commoditize nearly as much as any one product might. They do a business around a deep understanding of their customers. This is customer-centric approach

Which of these retailers are highly “customer centric”? Walmart Apple Starbucks Nordstrom centricity is all about Now that we understand what product and we've discussed some of the cracks in product centricity. And even some of the opportunities from do better than a product-centric approach, companies to escape from and maybe I want to start moving away towards customer centricity. But before I give you a definition and talk it through, I'd like you to think about what customer centricity means, based on your experience as well So in order to do that, I want to work as what I've discussed so far. with a series of examples here. In fact, on this slide, you'll see the names of four very famous retailers. Three of them operate on a global level none of these firms are truly customer centric. of it's customers./not have a loyalty program Walmart – surprisingly little about any one Walmart has made very little effort to date to try to figure out exactly what each customer's doing. And how they can influence each customer's behavior. However, they make great efforts to understand the customers as a events occur. For instance, when a hurricane is about to hit the south eastern US, Whole. They understand regional differences They understand when certain kinds of they need to fill the stores with water and batteries and so on. So they understand the customer in a generic way but they make very little Effort to understand the customers in a very Specific granular way as a direct marketer would suggest. Not so surpice because walmart intend to sell great volumes, itโ€™s about bringing the costs way down. So, in many ways, Walmart is a prototypical, and a wonderfully successful, product-centric firm. There are a very few firms in the world that can operate in an operationally Excellent (now have scan and go for customer) It's a similar but different story for manner as well as Walmart can. Apple. --------------------- because Apple again, is the classic performance superiority firm. They don't spend a whole lot of time doing market research, to figure out exactly They don't spend a whole lot of time what the customer wants. focusing on segmentation and real granular analysis to try to predict what any one customer is going to do over time. Is taking the kinds of products that is leveraging its product expertise. they've already developed, and figuring out what are the next ones that they should develop. Have some trackin customer itune preference but not driving business in this case One day, if and when competition catches up and Apple can no longer be the product leader that they are, they a great customer-centric firm as well. could probably turn around and start to be **** -------- Starbuck At a local level, Starbucks or any coffee retailer, is very, very customer centric. – know your preference but not national level ones I'd like the usual please, they have no idea who you are. Now they try to track customer data ------------ Nordstrom's a high end department store. One thing they don't sell is tires. They sell clothing, shoes, and so on. Yet, one day someone walked in to a Nordstrom store. Supposedly in Fairbanks Alaska, and wanted of tires that obviously they could not to return a set have bought at Nordstrom's. Perhaps there was a tire store at that location before Nordstrom's opened shop. customer centric, gave them the And Nordstrom's being so incredibly money back for tires that they didn't buy at Nordstrom's. Customer centric or Stupid? If that customer is incredibly valuable to you, and I'm talking about future value, this customer to be buying so I'm talking about the fact that we expect much from us in the future that if we don't give them money back for the tires that they thought they the money back today, we're going to lose bought from us, if we don't give them that value. So it all depends on the value of the customer. The lifetime value of the customer. The future value. If that's sufficiently high. And that's the problem with Nordstrom's. They treat everybody so incredibly well. Nordstrom's offers such wonderful service. Regardless of the value of that customer. And that's the problem with Nordstrom's, is that because future value they fail to focus on figuring out the of each and every customer, So to me the Nordstrom's example is a example of, of where a product and great customer centricity collide.

What is customer centricity? Customer centricity is a strategy that aligns a company’s development/delivery of its products/ services around the current and future needs of a select set of customers in order to maximize their long-term financial value to the firm. Customer centricity requires the company to be willing and able to change its organizational design, performance metrics, and employee/distributor incentive structures to focus on this long-run value creation/delivery process.

Customer-centric Approach The goal of the firm is to maximize profits Celebrate customer heterogeneity: distinguish the profitable customers from the less profitable ones Focus on future profitability (customer lifetime value) rather than past profits Success arises through enhanced (and/or more efficient) customer acquisition, retention, and development Customer-centric organizational structure The competitive advantage – “relationship expertise” with respect to focal customers

Galbraith (2005), Designing the Customer-Centric Organization

Reflections on customer centricity Customer centricity does NOT suggest that “nonfocal” customers should be ignored or “fired;” to the contrary, it is important to have a healthy proportion of such customers to add a high degree of stability and robustness to the overall customer base. (Think of them like cash in an investment portfolio.) Taking this idea further, there is a paradox of customer centricity: the more that a firm tightens its central focus on a select group of customers, the more it needs its “non-focal” customers to stabilize the overall mix.

Discussion questions According to the usage trends of mobile applications, think of one application you want to do business. Who is the customer? Can your organization come up with a single, consensus answer to this question, or can you at least reconcile the roles/relationships of the different potential customers? What are the major barriers to account for? Develop a comprehensive list, ranked by the importance/difficulty of each barrier. What resources can you utilize to overcome these barriers? Thoughts about what competitors are doing in this area? Does it make sense for your organization to become customer centric? If so, what should be your immediate goals and expectations?

Worldwide Survey of Mobile App Users by by Soo Ling Lim, 2013 http://infogr.am/app-user-survey-0?src=web

What is the distribution of users across mobile app platforms?

How frequently do users visit their app stores to look for apps?

On average, how many apps do users download per month?

How do users find apps?

What triggers users to start looking for apps?

Why do users download apps?

What types of apps do users download?

What are the factors that influence users' choices of apps? Customer behavor + marketing strategies to communicate India very concerns about environment เลิอกมาห Priciing ……… However indian care less about price if they like they might choose

Ratings influence app selection: why do users rate apps? If you want to mouth to moutn straetgy you should impress customer about the produxct

Why do users pay for apps? Marketing strategies – promotin\on

Why do users stop using an app?

Age and Gender http://www.d2c.co.jp/en/news/2012/20130130-1613.html

Type of Work

References Customer Centricity: Focus on the Right Customers for Strategic Advantage, by Peter Fader Introduction to Marketing Course, University of Pennsylvania