The Rise of Holistic Enterprise Mobile Engagement

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A Forrester Consulting Thought Leadership Paper Commissioned By OpenMarket

The Rise Of Holistic Enterprise Mobile Engagement
August 2013

Forrester Consulting

The Rise Of Holistic Enterprise Mobile Engagement

Table Of Contents
Executive Summary ................................................................................................................................................................................. 2 The Mobile Shift: New Opportunities, New Challenges .................................................................................................................. 3 Businesses Crave Customer Engagement ........................................................................................................................................... 7 Mobile Engagement Platforms Will Emerge As Force Multipliers .............................................................................................. 16 A Coordinated Engagement Strategy Will Help You Surf The Mobile Shift ............................................................................. 19 Appendix A: Methodology................................................................................................................................................................... 20 Appendix B: Demographics/Data....................................................................................................................................................... 20 Appendix C: Endnotes .......................................................................................................................................................................... 22

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Executive Summary
The shift to mobile devices represents a fourth great revolution in computing, and it’s remaking the way we communicate. Over the past 50 years we’ve gone from mainframes to minicomputers to PCs, from browsers to smartphones and tablets. With each move we’ve made a generational leap in the way we engage with each other, the brands we buy, and the companies we work for. During each transition the opportunities for more personalized and more relevant engagement have grown, but seizing these opportunities is easier said than done. It requires a thorough understanding of new technologies, device platforms, communication patterns, and personal preferences, and it demands significant changes to existing technology infrastructure, processes, and skills. In May 2013, OpenMarket commissioned Forrester Consulting to evaluate the current state of mobile engagement at large enterprises. To get the best picture of how companies are adapting to the mobile shift, Forrester developed a survey that asked business leaders about their mobile efforts. Conducting an in-depth survey with 167 mobile channel decision-makers, Forrester found that these enterprises regard the mobile channel as one of their most important communication channels. Customer engagement is a top priority in the mobile channel, but companies are struggling to balance their investments in internal staff and external mobile services with the speed required to meet their engagement needs. When it comes to how companies are driving their mobile engagement, it’s clear that they view mobile communications as just a small part of an overall engagement strategy. As a result, there is a high level of interest in adopting advanced mobile services including SMS, MMS, push messaging, email, voice, and QR codes to drive a holistic engagement strategy.

Key Findings
Forrester’s study yielded four key findings:
• The mobile channel is a top business priority. The importance of reaching customers via the mobile channel

has grown to the point where it’s virtually tied with PCs for top priority. It’s more important than ever for businesses to get their mobile engagement strategy in place as soon as possible.
• Customer engagement is a clear priority for mobile strategy. Engaging with customers trumps supporting

employees or partners or driving revenue through the mobile platform. This engagement goes beyond awareness and consideration of products and services; it aims to improve customer satisfaction, provide support, and build long-term loyalty.
• Mobile engagement is about more than mobile apps. Most businesses incorporate SMS, MMS, and bar codes or

QR codes into their mobile strategy today. Many are looking to add advanced features like call queuing, two-way SMS, voice recognition, push notifications, and click-to-chat to their engagement strategy over the next year.
• Organizations struggle to master the challenges of the mobile shift. The organizations we surveyed are

spending, but it’s questionable if they’re spending enough to sustain more than a few ongoing mobile projects. Many are using internal IT resources, but these teams are dealing with a multitude of integration, security, and process challenges. Rather than struggle to build a mobile infrastructure, we suggest that these teams focus on solving business problems and look for opportunities to use third-party mobile software and cloud-based services as a force multiplier.

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The Mobile Shift: New Opportunities, New Challenges
For technology professionals, change is constant—like waves rolling in from the ocean. While it can be pleasant to sit back and watch the innovations rolling in one after another, the real rewards come from being part of the action—from surfing the waves and, in particular, from finding the “seventh wave” that lets you ride all the way into the shore. When surfing the waves of new technology, it pays to find that seventh wave―to invest early in those innovations that have real business value, that will remake the market. The Internet is one obvious example. Another is mobile. Need proof that the mobile shift really is remaking the market? Look at what’s been happening in the past five years. We’ve seen enormous spikes in consumer adoption of mobile phones, especially smartphones. The numbers are staggering: more than 6 billion mobile devices worldwide and more than 700 million smartphones sold in 2012 alone.1 The mobile shift impacts all aspects of communication, customer engagement, and business operations. As a result, mobile devices redefine how enterprises engage with customers, employees, and business partners. Increasingly, a smartphone is the first device people reach for when they need information (see Figure 1). We see that, while consumers mainly use their tablets at home, they use their smartphones in all kinds of places, whether it’s the living room, car, store, or restaurant.

Figure 1 Smartphones Are Used Everywhere, Tablets Are Used At Home

Base: 11,094 US online adults (18+) who own a smartphone and go online on a smartphone weekly or more Source: “The State Of Consumers And Technology: Benchmark 2012, US,” Forrester Research, Inc., January 15, 2013

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And it’s not just consumer engagement that’s changing. What we see with consumers is reflected by what we see at work. It’s especially true for information workers — those who process and act on information as part of their jobs. Whether it’s a conference room, another building on campus, a manufacturing plant floor, or the showroom floor, employees also tend to reach for smartphones and tablets more often than PCs or laptops (see Figure 2). Increasingly, your employees are demanding a mobile-first approach as much as your customers expect it.

Figure 2 Information Workers Shift To Mobile Devices When They’re Away From Their Desks

Base: global information workers using each device Source: “2013 Mobile Workforce Adoption Trends,” Forrester Research, Inc. February 4, 2013

The mobile shift presents countless opportunities to improve customer engagement. These opportunities extend throughout the entire customer life cycle, from awareness to consideration, through conversion to loyalty and advocacy. Mobile lets brand marketers engage consumers when they’re outside of their home and away from traditional channels. When choosing products, mobile engagement allows customers to read reviews, learn about specific product and service features, and make comparisons in an immediate, interactive, and educational way. Mobile devices can provide marketers with immediate conversion opportunities, including click-to-call capability and mobile commerce, while measuring positive responses. The mobile shift also creates opportunities for improving operational engagement. Ongoing engagement in the mobile channel can improve customer service, enable self- and peer-driven help, and lower operational costs by reducing call center load and customer complaints. Organizations can enhance engagement and awareness during regular interaction through real-time access to information. For example, an effective mobile messaging strategy can drive the selection of additional services during a vacation stay at a resort, or a mobile app can provide the latest information about a financial portfolio or service interruptions. Mobile can provide the most up to date information, which helps sales reps accelerate decision-making and shorten sales cycles.

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Many of these new engagement opportunities stem from the particular characteristics of smartphones — they’re highly personal devices, they’re almost always on, and they’re almost always connected to the Internet. Smartphones enable immediate, quick interactions and allow businesses to reach out and alert customers, employees, and partners through multiple channels, including SMS, MMS, push notifications, email, and voice. Their smartphones know more about users’ habits and desires than any other device: their preferred language, their location, what they’ve searched for, where they’ve been, and where they’re likely to be in the future. A user’s smartphone can be used as a way to provide enhanced identification and authentication for secure transactions. It can be used as a wallet, an access card, and a remote control for other nearby devices. The significant opportunities of the mobile channel are reflected in how highly business leaders prioritize it. In conducting an in-depth survey with 167 mobile channel decision-makers, we found that mobile phones have already become the second most important channel through which businesses engage with customers, employees, and business partners (see Figure 3). In fact, when it comes to channel priority, smartphones (at 28%) are nearly tied with PCs (at 31%). And tablet support isn’t far behind as the fourth most important channel, behind brick-and-mortar stores (for those companies that have them). We expect that, over the next few years, mobile channels will continue to grow in importance, as more and more devices emerge and as the capabilities of smartphones and tablets continue to expand. The call to action is clear: You must have a mobile engagement strategy, and you don’t have a lot of time left to put one in place.

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Figure 3 Mobile Phones Are A High Priority Engagement Channel For Business Leaders
“How important to your overall corporate strategy is it to engage with customers, employees, and business partners across the following channels/devices?” Not used PCs 1%5% Mobile phones 1%5% Brick-andmortar/retail stores Tablets 3% Telephone/IVR Print media eReaders In-car systems Smart TVs 13% 11% 5% 15% 35% 49% 46% 21% Low priority 16% 20% 28% 25% 20% 35% 27% 24% 22% 16% Medium 48% 46% 16% 41% 35% 35% 20% 15% 14% 16% 19% A priority Our top priority 31% 28% 19% 17% 13% 9% 2%

10% 2% 15% 1%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

The mobile shift offers many new business opportunities, but they don’t come free. Businesses must make substantial investments and changes to their processes and systems architecture to properly support mobile devices. These changes include:
• Support for new platforms and multiple device types. You still need to support PCs, but now you also must

support several mobile platforms and a myriad of devices, form factors, and operating system versions. Your mobile services will also need to stay up to date and keep working when new versions of popular mobile platforms are released. You’ll need to look for mobile messaging services that reduce cross-platform complexity by providing consistent programming and service models — or expect to see a significant rise in your client-side development costs.
• Engaging customers with a mix of channels. Mobile devices add new ways to engage users that go beyond

traditional applications or web pages. Mobile features such as SMS and MMS, push notifications, social networking, email, and voice can increase engagement if you know how and when to use them. We find that the best mobile experiences mix multiple tactics; for example, use SMS or push notifications along with or instead of apps for customer service use cases such as shipping alerts, bill reminders, and appointment notices, or mix SMS text with URLs to mobile-friendly websites.

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• Faster delivery of services and new content. In the mobile channel, rapid delivery matters. Campaigns with

time- or location-sensitive offers need to get customer attention and drive immediate action. Customer service data needs to be fresh; if it’s a few hours old, customers or employees may not get the information they need in time to make an important decision. Imagine keeping customers waiting to check into their hotel room or pick up a rental car because they weren’t promptly notified when their service was ready. Faster service delivery is also a consideration when it comes to choosing which mobile tactics to employ. Needing to crack open a mobile app and resubmit it to app stores every time you make a change is not sustainable. An enterprise mobile engagement strategy that incorporates SMS and MMS bypasses the need for users to find, download, install, and use a mobile app and avoids the hassles of dealing with app store updates to surface new content. It makes it easier to experiment with new engagement tactics, measure their results, and keep the ones that work.
• An updated integration strategy. The move to a mobile-first strategy involves a very different architecture that

connects your existing systems of record (which store and process information) with new systems of engagement (which distribute information and work hand-in-glove with carrier networks, often connecting through public cloud infrastructures).2 This integration layer will need to scale up to support thousands of connections with variable latency and scale down during off peak hours. In addition, many companies are finding that it’s not just their own on-premises systems that are part of this integration puzzle but also services from third parties that are integrated and aggregated in their distribution tier.
• Finding (and paying) for mobile talent. It takes a specific set of skills to successfully design and implement

mobile processes. We are not surprised to find that many organizations turn to experienced third parties like design agencies, mobile ISVs, and software-as-a-service (SaaS) providers. Acting as force multipliers, these third parties enable businesses to overcome staffing and expertise gaps and help speed time-to-market for new engagement services.

Businesses Crave Customer Engagement
We asked business leaders how they’re looking to more effectively leverage mobile communications and the challenges they face in doing so. When we asked them about their top three priorities for the mobile channel, there was a clear focus on engagement (see Figure 4):
• Increased customer engagement is the top priority. At 63%, increased customer engagement is far and away the

top priority business leaders have for their mobile channel strategy. This self-reported focus on customer engagement matches what we hear anecdotally in our conversations with brands and spans the entire customer life cycle, from lead generation and awareness through consideration, conversion, and purchase to customer support, loyalty, and even brand advocacy.
• Improving customer satisfaction requires ongoing engagement. Improving customer satisfaction is the next

most important priority, at 38%. An ongoing conversation with repeat customers is a key step to building loyalty and driving repeat purchases. It’s especially true in industries with high levels of competition and easy product

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substitution. In our survey, business leaders in financial services, retail and wholesale, and media entertainment and leisure all ranked customer satisfaction higher than the average — not surprising, as all three industries are investing heavily in the mobile channel to attract and keep customers.
• Increasing direct revenue is an important, but secondary, consideration. Twenty-seven percent of business

leaders surveyed singled out increased revenue and sales as a driver for the mobile channel. For the business leaders we surveyed, the mobile channel comes in second only to the PC as a revenue channel and ahead of brick and mortar stores for all industries except retail and wholesale (see Figure 5).3 Our take? While engagement, satisfaction, and customer acquisition outrank direct revenue, it’s still a consideration for many firms.
• Employee and partner needs take a back seat to customer needs. Only one in five survey respondents said that

employee or business partner enablement was a top priority. While that may change over time, it indicates that business leaders are less focused on employee and supply chain issues and more focused on engaging with customers. This reflects a prioritization of scarce resources in the short term, as many companies we speak with have dozens of mobile projects on the books and scant resources to devote to them. As a result, customer-facing projects tend to get the nod first.

Figure 4 Customer Engagement Is The Top Mobile Priority
“What are your company’s top 30 priorities/objectives for your mobile communication strategy?” (Select all that apply) Increase customer engagement Improve customer satisfaction Acquire new customers Generate revenue/sales completed in mobile channel Reduce operating or marketing costs Build loyalty Improve employee or partner engagement Increase brand awareness Reach particular consumer segments Appear innovative Drive traffic/sales in other channel (e.g., physical stores) Test the waters/learn about the mobile channel Other (please specify) 38% 35% 27% 25% 22% 20% 14% 14% 13% 12% 7% 1% 63%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

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Figure 5 Driving Revenue From Mobile Phones Is Important
“How important to your overall corporate strategy is it to transact and drive revenue from customers using the following channels/devices?” Not used PCs 6% 7% Low priority 13% 27% 26% 5% 9% 15% 17% 17% 14% 36% 43% 51%
Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

Medium 44%

A priority

Our top priority 29%

Mobile phones 4% 7% Brick-andmortar/retail stores Tablets Print media Telephone/IVR eReaders Smart TVs In-car systems

34% 16% 29% 26% 27% 26% 26% 26% 13% 21% 31% 37% 37% 23% 13%

28% 25% 17% 10% 7% 10% 13% 14% 4% 2% 7% 1%

As External Spending Lags Behind Demand, Pressure Mounts On Internal Staff
We noted in the previous section that employee and partner engagement is taking a back seat to customer-facing priorities. We also noted that we suspect that this is due to prioritization in a resource-scarce environment. This assertion is not just based on what we’ve directly observed — it’s also evident in this survey:
• More than 60% of business leaders are investing less than $5 million in mobile in 2013 . . . When we asked

business leaders how much they’re spending on mobile services and vendors, they replied that it’s toward the lower end of the project spectrum (see Figure 6). More than 60% of survey respondents are spending less than $5 million on external mobile services and vendors, and 40% are spending less than $1 million. Realistically, this level of budgeting will support a handful of projects at best, well below the level of mobile needs we see at most large enterprises.
• . . . but staffing levels are high, which means labor costs drive capacity. While less than a third of the

enterprises we surveyed are budgeting more than $5 million in mobile spend in 2013, almost a third have 50 or more people working full time on mobile within their company (see Figure 7).

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Figure 6 External Mobile Spending In 2013 Is Low But Growing
“What kind of investment in mobile do you see your company making in 2013?” More than $50 million Between $20 million and $50 million Between $10 million and $20 million Between $5 million and $10 million Between $1 million and $5 million Between $500,000 and $1 million Between $250,000 and $500,000 Less than $250,000 Don’t know 10% 10% 13% 17% 5% 5% 8% 10% 23%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

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Figure 7 Labor Costs Absorb A Large Proportion Of Mobile Spending
“Approximately how many people within your company are working full time for your company’s mobile efforts globally?” 50 or more 15 to 49 10 to 14 Five to nine Two to four One None Don’t know 0% 8% 4% 14% 13% 10% 21% 31%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

This focus on devoting internal resources to mobile efforts is somewhat surprising, as we often find that in the early stages of a technology shift, companies will outsource projects because they simply don’t have the in-house experience required to successfully exploit new technologies. That’s been our experience with the mobile market over the past few years, but it now appears that companies are starting the hard work required to build in-house expertise. In particular, it appears that they’re investing in internal IT skills for custom mobile app development. Almost four in 10 of the business leaders we surveyed indicated that they’re using internal IT resources to custom build mobile solutions (see Figure 8).

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Figure 8 Businesses Are Investing In IT Skills To Build Custom Mobile Infrastructure
“Which statement below best describes the implementation approach you are pursuing for your mobile strategy?” Custom built internally/in-house with our own IT developers Outsourced to an agency specializing in mobile services Licensed a platform and built a mobile site/application with in-house tools Outsourced to our eCommerce platform vendor Have not yet selected an approach Assembling a platform from component services purchased from multiple vendors Licensed and configured an application that was already built Outsourced to an interactive agency Using a managed service, provided by a carrier or SaaS partner 9% 7% 7% 5% 4% 4% 3% 19%

39%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

The problem with the picture painted by this data is that it creates a situation that’s untenable in the long term. Without a change in strategy, demands and spending on internal resources will continue to mount as mobile platforms and form factors proliferate. That’s especially true for companies that invest in native client-side applications, as each has its own programming language, development frameworks, and messaging APIs. We recommend the following tactics to keep your mobile budgets from growing out of control:
• Prioritize core processes. When working in a resource-constrained environment, it makes sense to focus

internal expertise on the business processes and functions that create a competitive advantage. That’s also true when it comes to the mobile channel. We recommend focusing internal developers and business leaders on enabling existing systems of record for mobile and improving the integration infrastructure required to provide up to date, accurate information that’s as fresh as possible.
• Leverage cross-platform solutions to reduce delivery costs. Most firms simply can’t afford to write the same

mobile features and functions three or more times, yet that’s exactly what happens when they adopt native point solutions specific to popular smartphones. It takes numerous disciplines to manage multiple code bases and

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coordinate simultaneous releases of new features — but that’s exactly what customers expect. We’ve spoken with many companies that warn of launching a new capability on one platform before others because it irritates customers that use alternative mobile platforms. A better strategy for broadening mobile engagement is to define a feature once and use a cross-platform solution to make it available on multiple device platforms simultaneously while minimizing the amount of device-specific code you have to maintain. A key part of keeping multiplatform delivery costs under control comes from selecting communication channels — like SMS, MMS, email, and voice — that are consistent across device types. Adding these tactics to mobile app development or using mobile messaging alone maximizes engagement while keeping deployment and maintenance costs in line.
• Use services to manage mobile infrastructure complexity. Connecting mobile devices to existing systems isn’t

exactly straightforward. In most cases, IT shops have minimal experience integrating with carrier infrastructure, building asynchronous message routing architectures, and using analytics to assess which customer engagement tactics are working and which aren’t. Mobile service providers can help organizations quickly accelerate in all these areas by providing a ready-to-go platform that’s simple to integrate into existing, on-premises applications.

As Demand For Advanced Mobile Services Increases, Delivery Challenges Rise
While businesses are still ramping up their spending on mobile initiatives, their use of mobile engagement tactics beyond simple apps is already well established (see Figure 9):
• Most enterprises are already using SMS to engage mobile users. Seven in 10 business users are already

deploying SMS notifications as part of their mobile strategy, and this will move even higher in the future. Widespread adoption of SMS is good, as it allows companies a ubiquitous way to engage with virtually every mobile user. SMS can serve as a standalone engagement channel, part of a larger integrated engagement strategy, or both. For example, in a fraud detection scenario you’d want to alert customers on their mobile devices whether or not they’ve installed your mobile app.
• Bar codes and QR codes are widely employed, and customer adoption is growing. Six in 10 mobile channel

decision-makers are using bar codes or QR codes, and they’re starting to get better returns on those investments. Overall, 20% of mobile phone users and 22% of smartphone users scan and use bar codes or QR codes, up from 5% for mobile and 15% for smartphones in 2010. But implementation challenges remain: Too often, the planning for codes doesn’t go far beyond generating a free code and printing it somewhere. As a result, many bar code use cases don’t point to mobile-optimized content, offer little-to-no communication from the benefits of a scan, and sometimes even have poor physical placement.
• Other services lack majority status today, but won’t tomorrow. Most other advanced mobile services are not

yet currently deployed by a majority of business leaders. However, plans to adopt them in the future signal a firm desire on the part of business users to incorporate these services into an overall engagement strategy. In particular, push notifications and text-to-speech are set for strong growth, with click-to-chat and voice recognition not far behind.

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• NFC and geofencing will lag behind the adoption rates of other mobile services. Few mobile channel decision-

makers use either geofencing or near field communications (NFC) today, and adoption will continue to lag behind other services over the next year.

Figure 9 Businesses Are Incorporating Advanced Mobile Services
“Which of the following mobile technologies does your company use today in your mobile strategy, or plan to begin using in the next 12 months?” Use now SMS notifications Bar codes or QR codes Call queuing 2-way SMS Direct carrier billing Voice recognition Click-to-chat Push notifications (e.g., APNS, C2DM) Text to speech Near field communications (NFC) Geofencing 46% 46% 40% 38% 37% 35% 32% 23% 16% 20% 24% 26% 57% 60% 13% 22% 22% 31% Plan to use 70% 60% 16% 18% 48% 40% 41% 34% 43% 9% No plans 16% 31% 39% 36% 14%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

The results of increased demand for advanced mobile services and thinly stretched staff are predictable. Instead of focusing on maximizing ROI and maximizing the outcomes of their mobile investments, organizations struggle to keep all the challenges of building advanced mobile engagement infrastructure under control. These challenges span fiscal and technical dimensions (see Figure 10):
• Integration expense is a top concern . . . It follows that with IT-led custom mobile projects as the primary means

of delivering advanced mobile services and applications, budgets would be stressed as the developers hardwire mobile services into existing systems of record. Fifty-five percent of survey respondents report this as a significant or critical challenge to their mobile strategy.
• . . . and it’s not just the expense of integration. The actual process of integration presents a challenge to 47% of

survey respondents. Common issues include service-enabling existing systems; providing a scalable, reliable

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messaging infrastructure; and integrating apps with other advanced services such as messaging, carrier services, and analytics.
• Data privacy and security is also a primary concern. With new architectures, code, and client platforms, it’s

little wonder that security is a top concern. And while the primary security threat for mobile platforms comes from physical theft of unsecured devices, other issues such as app hijacks or clear text transmission of personal information are also possible. This problem is most acute for respondents in financial services and healthcare, where 43% and 39% of survey respondents rate it as a critical problem.4
• Mobile platform sprawl creates a maintenance headache. The third most challenging aspect of mobile strategy

is the number of platforms and the complexity of integrating applications and services when each platform uses a different language and framework. As a result, most firms don’t properly budget client-side development resources, and a need for regular updates blows budgeting. The result — more projects get deferred as the maintenance demand of early projects eats up more of the existing mobile budget.
• Required speed of execution exacerbates mobile service delivery. The gap between IT capability and business

needs shows up in multiple ways: 43% of respondents say it’s a critical or significant problem that their IT organization can’t move fast enough to support B2C efforts, while 38% also say the rate of platform release is a significant or critical problem.
• Integrated mobile strategy isn’t a pressing concern, but it should be. Our survey found the least worrying issue

among respondents was that their current B2C, B2B, and B2E mobile strategies are disconnected. While it’s possible that this lack of concern indicates ample coordination on the part of respondents, that doesn’t match what we see anecdotally. Although many businesses are using advanced mobile services like SMS and MMS for B2C initiatives, few exhibit a unified mobile strategy for providing B2C marketing, B2C customer service, and B2E operations. More often, these functional areas are treated as three mobile silos with different teams working to support each one. In the long run that’s not cost-efficient and leads to technology sprawl while increasing integration expense. Many of the challenges our survey respondents report stem from a common source. Their IT shops are struggling to build and maintain a mobile solution in-house with existing skills and technologies. This approach can work for early pilots and can support a limited number of applications and services, but it’s not sustainable as mobile engagement becomes increasingly important. We expect companies to increasingly look to ISVs and SaaS providers for platforms that provide speed, new functionality, flexibility, and customization with a complete focus on the mobile channel so that IT shops can focus on core business needs instead of engagement infrastructure.

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Figure 10 Integration Expense Is The Top Mobile Challenge
“How challenging do you find the following aspects of your mobile strategy?” Not a problem 2 3 4 25% 29% 29% 31% 28% 28% 31% 18% 18% 16% 22% 18% 23% 16% 22% 35% 32% 30% 37% 34% 37% A critical problem 39% 25% 34% 32% 31% 21% 34% 26% 28% 30% 25% 28% 18% 18% 16% 28% 16% 15% 14% 22% 9% 16% 10% 8% 11% 4% 8% 7%

Expense of integrating mobile into current back-end 5% 13% systems Data privacy and security around mobile The number of different platforms/operating systems Integrating mobile solutions with back-end systems Finding skilled developers to design the user interface and experience Our IT organization is not moving fast enough to support our B2C efforts Channel skills Complying with regulatory requirements Rate of releases of the different operating systems/platforms Maintaining existing apps/sites by releasing frequent updates Complex or expensive licenses for mobile solutions Form factor variations within the operating systems Integrating with carrier specific services like direct billing, SMS/MMS and location Our B2C mobile strategy is disconnected from our B2E and B2B mobile strategy 13% 10% 8% 11% 13% 10% 17% 7% 13% 10% 8% 12% 18% 7% 13% 13% 14% 16% 16%

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

Mobile Engagement Platforms Will Emerge As Force Multipliers
So how do you reconcile expanding budget pressure with increased demand for advanced mobile services? We suggest that companies focus on driving early successful business outcomes that demonstrate a positive ROI. If early results are good, then executives are more likely to expand mobile investments. But that’s easier said than done — given all the heavy lifting involved in setting up infrastructure, acquiring skills, and developing an integrated engagement strategy, it’s not uncommon to see enterprises spend years with little to show for their efforts or investments. Reducing the time it takes to deliver mobile engagement is key — the faster you can understand what works for different mobile users, the faster you can tune your mix to fit customer needs while keeping costs under control.

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You need to implement mobile infrastructure to prove a business case, but building the infrastructure to do so is timeconsuming and expensive and takes specialized skills. It would seem to be a Catch-22. We’ve seen this sort of conundrum before at the early days of the shift from client/server to web-centric architectures. In the early days, developers focused on building web infrastructure as well as company-specific content and had the same challenges in developing and testing clients that would work with different browsers. But that’s not how it’s done today. In response to these challenges, we saw the emergence of platforms (i.e., middleware, content management systems) specifically tuned for building web applications and delivering web content to employees and customers. We’re seeing a similar trend in the mobile space — the emergence of platforms that ease and speed mobile service delivery by:
• Automating delivery of advanced mobile services. A mobile engagement platform provides prebuilt services

that work across multiple mobile platforms including smartphones, feature phones, and even tablets. By integrating these services into a single delivery framework, the platform makes it easier to quickly deliver a unified customer engagement experience that works across multiple channels and engagement modes. A mobile engagement platform also pre-integrates the tools developers need and provides infrastructure that’s ready to go as soon as they need it. Writing the complex logic for “table stakes” functionality is better outsourced to experts than built in-house. For example, a platform can help automate common processes such as customer opt-in to services, stopping message delivery, providing help, and message subscription services.
• Integrating mobile services into a unified engagement experience. Many businesses are consumed by their

mobile app strategy today, but there’s more to mobile than just apps. For one thing, mobile-optimized websites are still needed to handle incoming browser traffic. More importantly, the best way to grow the user base for a mobile app investment is through regular engagement, and integrating messaging (whether SMS, MMS, or push) is a time-tested tactic that increases overall engagement by pushing customers past the “drop-out zone” where they download an app, use it a few times, and then forget about it. Enterprises shouldn’t be using these channels separately from each other, but in harmony to provide a unified customer engagement experience.
• Removing developers as an implementation bottleneck. A mobile engagement platform offers development

flexibility by supporting multiple implementation approaches. Of course, internal IT-led development teams can use it, but standardizing APIs also makes it possible for third-party developers to augment internal staff. A mobile engagement platform also pre-integrates APIs from third parties like mobile carriers and specialists and service UIs that provide non-developers a way to graphically set up mobile service workflows and reduce the time it takes to round out an engagement strategy. The service UIs in particular are important, as they allow businesses to update engagement tactics without requiring new custom code or redeploying a new version of a mobile app.
• Reducing labor costs while scarcity exists. With the high labor costs for mobile development and growing

project backlog, it makes sense to reduce dependence on hard-to-find mobile developers wherever possible. This doesn’t necessarily mean a large upfront investment in on-premises hardware and software, as modern mobile engagement platforms are available in a SaaS model. A SaaS-based mobile engagement platform doesn’t require a large upfront commitment to hardware, software, or additional labor costs in the form of system administrators. It also makes it easy to quickly deploy new engagement services as they become available, usually through updated versions of the engagement platform’s service interface or APIs. SaaS platforms also have the advantage of on-demand capacity, which allows an enterprise to quickly scale up infrastructure as demand grows or even

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vary demand to suit short-term needs like event-based messaging campaigns, emergency alerts, or breaking news updates.
• Simplify variation in carrier service offerings. Developers tend to look at carriers as a “dumb pipe” — providing

access to applications and services even where the carriers offer unique services. The last thing developers want to do is codify special allowances for multiple carriers’ custom services into a mobile strategy. They want to program to consistent APIs or services that abstract carrier specific implementation wherever possible. A mobile engagement platform takes on this complexity burden, abstracting across carrier service implementations. As an example, this might include working with carrier-specific SMS implementations around the globe or abstracting across the various push messaging implementations developed by smartphone platform providers.

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A COORDINATED ENGAGEMENT STRATEGY WILL HELP YOU SURF THE MOBILE SHIFT
The shift to mobile is big. It has the potential to severely tax your existing strategy, infrastructure, and skills, and to outstrip your initial budgets. The rapid pace of innovation combined with the variation of services and requirements across carriers and geographies will leave those attempting to do everything themselves scrambling to keep up. Successfully managing the mobile shift will take skill, flexibility, and time. It will require a coordinated mobile engagement strategy that integrates apps, SMS, MMS, email, push notifications, and advanced carrier services into a single toolbox. To get there: • View mobile engagement as much more than building apps. While industry observers tend to focus on the number of apps in stores, billions of apps downloaded, and “developer-gets-rich-overnight” stories, it’s clear that a sustainable engagement strategy goes way beyond the app. The high adoption rates of advanced mobile services like SMS, MMS, and QR codes, coupled with plans to adopt call queuing, voice recognition, and click-to-chat, show that mobile channel decision-makers are thinking holistically when it comes to their engagement strategy. Understand and use the unique aspects of the mobile channel. Your IT peers may treat phones and tablets as like devices because the manufacturers, programming languages, and application frameworks are the same. But from a usage perspective that’s not the case, as each device — phone, tablet, and PC — is used in different ways, in different locations, and at different times. Mobile phones also have access to additional capabilities like SMS and MMS and are almost always on, connected, and nearby. If you want to optimize your mobile engagement strategy, make sure you take advantage of the personal qualities and additional engagement tools that mobile offers. Use cloud infrastructure to speed delivery and reduce costs. Smart enterprises are using the technical characteristics and flexibility of cloud infrastructure to accelerate their mobile engagement plans. Whether it’s a public cloud that connects to mobile devices or a mobile engagement platform delivered via SaaS, scale-out infrastructure is allowing these companies to quickly test the waters, engage customers through multiple touchpoints and interactions, and focus on building engagement strategies instead of engagement infrastructure. And the pay-as-you go model reduces upfront costs which results in less risk and a quicker return on investment. Engage throughout the sale and beyond. Customer engagement should be long-lived — it starts with awareness and consideration, builds through a purchase, and then continues on after the purchase to help build loyalty. Reaching out to users to remind them of the value you provide plays a critical role in building a long-term relationship that will lead to repeat purchases and referrals. Make sure you focus on a long-term engagement strategy — through the entire customer life cycle — and provide enough value and functionality in the mobile channel to fully realize the personalized, contextual view into your customers’ thoughts so you can anticipate their preferences and meet their desires. If you maximize convenience and make it easy for them to engage with your brand (by any means), you’ll be well on the way to turning transactional sales into long-lived, meaningful customer experiences.







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Appendix A: Methodology
In this study, Forrester conducted an online survey of 167 organizations in the United States to evaluate the effects of the shift to mobile on marketing strategy and customer engagement. Survey participants included decision-makers in marketing and IT with responsibility for marketing strategy decisions, software decisions, or architecture decisions. Questions provided to the participants asked about the importance of engaging and transacting with customers over specific channels and about various aspects of the firm’s communication strategy. The study began in May 2013 and was completed in May 2013.

Appendix B: Demographics/Data
Figure 11 Region And Company Size
“Using your best estimate, how many employees work for your firm/organization worldwide?” 500 to 999 employees 18% 5,000 or more employees 54% 1,000 to 4,999 employees 28% US 100%

“In what country do you live in?”

Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

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Figure 12 Job Title
“Which of the following most closely describes your job title?” Senior-most business leader (e.g., owner, president, C-level executive other than CIO) Executive in line of business/function (e.g., VP of marketing, Senior VP of manufacturing, VP of sales) VP/director in a line of business/function (e.g., director of sales, accounts receivable director) Manager in line of business/function (e.g., marketing manager, sales manager, product manager) Senior-most IT decision-maker in the firm (e.g., CIO, CTO) VP/director in IT Manager in IT
Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

8% 11% 13% 26% 13% 14% 15%

Figure 13 Decision-Making Responsibility
“Which of the following categories of decision-making do you have responsibility for?” (Select all that apply) Marketing strategy — channel strategy, eCommerce, go-to-market planning, B2C mobile Software — enterprise application or infrastructure software, custom software development Third-party services Hardware infrastructure — PCs and mobile devices, servers, server virtualization, data center IT security — infrastructure or data security, threat and vulnerability management, identity management Architecture — enterprise architecture, technology strategy, integration Sales force enablement — forecasting, CRM, sales planning
Base: 167 B2C mobile channel decision-makers Source: A commissioned study conducted by Forrester Consulting on behalf of OpenMarket, May 2013

64% 62% 59% 50% 46% 46% 44%

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Appendix C: Endnotes

Source: “Global Smartphone Shipments Reach a Record 700 Million Units in 2012,” Strategy Analytics, January 25, 2013 (http://blogs.strategyanalytics.com/HCST/post/2013/01/25/Global-Smartphone-Shipments-Reach-a-Record-700Million-Units-in-2012.aspx). In 2010, Geoffrey Moore laid out the case for “systems of engagement” as a new type of architecture distinct from traditional “systems of record.” For more information, read “Systems of Engagement and the Future of Enterprise IT: A Sea Change in Enterprise IT,” AIIM (http://www.aiim.org/futurehistory).
3 2

1

For retail and wholesale respondents, brick-and-mortar stores outrank the mobile channel as a top priority by a 54% to 35% margin. Related regulation mandates include HIPAA for healthcare providers and GLBA for financial services companies.

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