[This is the second in a series on 6 Factors that are transforming B2B Sales in 2012.]
The inexorable rise of mobile device ownership is one of the most significant changes in the business landscape that any of us has witnessed in our lifetimes. In most developed economies in the world, practically everyone has a cell phone, an increasing number of which are smartphones, and the rapid growth of tablet ownership, pioneered by Apple’s iPad, is the fastest market penetration of any device we have ever seen.
The Mobile Landscape
Unless mobile is a core element of the strategic plan of any business, the business will face severe challenges over the next few short years. For business strategists, marketers, sellers and buyers alike, mobile is becoming the hub around which business revolves. And within the mobile landscape, we are seeing pointers to an app-centric (native or web-app) smart device with a slick user interface and multi-touch gestures as the horizon to which we are all heading.
As I write this in early 2012, it is not unreasonable to ask whether Nokia or Research in Motion (the makers of Blackberry) will survive the hyper-competitive environment that has been thrust upon them by Apple and Google (Android) devices. Formerly titans of the cell phone market, Nokia and RIM are struggling to match the ingenuity and velocity of their more inventive competitors.
Nokia, struggling to reinvent its smartphone business around Microsoft’s Windows software, had a loss of €929 million in the first quarter of 2012 as sales plunged 29 percent because of flagging demand for its older Symbian smartphones. The loss, equivalent to $1.2 billion, contrasts with a €344 million profit a year earlier. Sales fell to €7.4 billion in the quarter from €10.4 billion a year earlier. The Nokia president and chief executive, Stephen Elop, said Nokia would accelerate its cost-cutting efforts amid what he described as a mixed response to its new Lumia smartphones with Microsoft.
For Research in Motion, it is difficult to see how they will survive as a standalone entity. RIM’s stock declined 75% in the twelve months to April 2012, and in the enterprise, its core market, it is losing market share at a very damaging rate. While email, instant messaging, and the other network services RIM provides its customers remain extremely popular with users and respected as first-rate technology, the company has struggled mightily to keep its BlackBerry smartphone and PlayBook tablet products relevant in the face of increased competition from Apple and Google.
The other major casualty of the rise of Apple has been Adobe’s Flash. Flash is a multimedia platform produced by Adobe. Flash has been the standard for adding video, interactivity, and animation to websites. According to Adobe:
- 98% of enterprises rely on Flash Player.
- 85% of the most used sites use Flash.
- 75% of web video is viewed using Flash Player.
- 70% of web games are made in Flash.
But in 2010, Steve Jobs had the courage to question the applicability of the Flash technology going forward. Jobs made waves and enemies when he banned Flash from use on all iOS devices. iOS is the operating system from Apple. Jobs was almost unanimously criticized by the industry.
After a largely public battle between Apple and Adobe, the latter capitulated in November 2011 announcing that Adobe is stopping development on Flash Player for browsers on mobile and increasing their investments in HTML5, Apple’s recommended platform.
When you combine all of these data points, you can derive your own picture of how the short-term mobile landscape will evolve. If you accept my hypothesis that mobile is in fact one of the most significant changes in the business landscape that any of us has witnessed in our lifetime, then you should consider what that might look like in terms of required capabilities for your business and the mobile platforms that will dominate.
In our own business, we’ve committed to delivering our Dealmaker sales performance application solutions in a mobile world; and, it is possibly interesting to relate how our customers’ opinion changed during the lifecycle of our mobile project.
In late 2010 and early 2011, when we first discussed with our customers their need for an iPad enabled Dealmaker, the interest level was only moderate. Our customers indicated that they would indeed be looking at it in the future – but that it was not generally a topic that was urgent. We listened to our customers, but also listened to our gut instincts. We took a view that if we wanted to maintain our leadership in the sales performance application marketplace, that we should invest ahead of the (mobile) market demand, and trust our instincts. So we ploughed ahead with the technology investment to deliver a HTML5 based web-app that would operate equally well in a web browser on a laptop as well as on iOS (from Apple) and Android (from Google) mobile platforms.
Dealmaker is a complex product with a broad range of capabilities that help sales organization to sell smarter – to win more sales opportunities – through intelligent sales process, automated deal coaching and collaboration tools, and to manage better – through accurate sales forecasts, predictive sales analytics and deep account planning and management methodologies embedded in the software. We decided that if we were to deliver Dealmaker on a mobile platform, then should go “all in” and provide all of these capabilities in the hands of the mobile sales worker. This was not an insignificant task.
When we first showed Dealmaker on an iPad at a customer event in November 2011, our customers were very impressed with the capability, but were singularly unimpressed or surprised by the fact that we had undertaken this initiative. These were many of the same people who, just nine or twelve months earlier, had expressed just tepid interest in mobile solutions for their sales teams. It was a lesson in product management and the need to balance customer input and market research with informed vision – and we were happy that we had made the right decision. During 2011, mobile solutions, almost surreptitiously, became a baseline requirement – fueled by a ubiquity that caught many people by surprise.
The evolution of the mobile-centric economy
At the end of 2011 there were just over 327m mobile subscribers in the US. That’s in a country of 315m people. What are they doing with those devices, (apart from following Lady Gaga on Twitter)?
Well, for most of us, our mobile device has become an extension or part of who we are, plugged in, and always on, in an increasingly connected network.
In the first three months of 2012, Verizon Wireless, the largest cellphone services in the US, reported that fewer customers joined its service compared to the same period in 2011. The predicament for carriers is that because most people who want a cellphone already have one, their subscriber growth has been anemic. That was the case for Verizon, which said it added 734,000 subscribers in the first quarter, 16 percent fewer than a year earlier. However, Verizon still managed to post a profit of $1.7 billion for the quarter, largely because of the fees that customers pay to watch videos, browse the Web or play music over Verizon’s network on their smartphones and tablets. Revenues generated from mobile data services were $6.6 billion, up 21.1 percent.
According to estimates by Cisco, by 2016 there will be 10 billion mobile Internet devices in use globally in a world where the population is projected to be 7.3 billion. In that same time-frame, smartphone traffic will grow to 50 times the size it is today, according to Cisco. To cope with this increasing demand, all the carriers say that they need more spectrum, the government-rationed radio waves that carry phone calls and wireless data.
As an example, in Verizon’s case, to get more radio waves, they made a deal in December 2011 to buy spectrum licenses from a consortium of cable companies including Time Warner, Comcast and Cox Communications, for $3.6 billion. (T-Mobile USA and Metro PCS, smaller wireless carriers, have urged the Federal Communications Commission to block the deal, claiming it would put too much spectrum in the hands of the nation’s largest carrier.)
And just in case we were unsure about mobile being the hub of future Internet traffic, Facebook paying $1 Billion dollars for Instagram is another data point to consider. The three-day sprint to the deal started on April 5, 2012 when Mark Zuckerberg, CEO of Facebook, picked up the phone and asked Kevin Systrom, CEO of Instagram to meet. At the time, Systrom was just hours from signing a deal for a $50 million venture-capital investment that would put a $500 million value on his company, which had just 13 employees and no revenue.
Instagram makes a smartphone “app” that lets people take photos, dress them up with special effects, and easily share them with friends. In the first three months of this year, its user base nearly doubled, to about 30 million, the company said at the time. After Instagram released a version of its app for phones powered by Google’s Android software on April 3, the user base shot up again, to around 35 million at the time of the Facebook deal.
Mark Zuckerberg was particularly concerned when he saw millions of people signing up for the Android app, people familiar with the matter said. One concern: Facebook was falling behind in mobile as younger start-ups were innovating more quickly.
Knowing your mobile customer
The market that we serve is business-to-business (B2B) sales organizations. The promise we make is that we can help our customers to increase revenue and gain more predictability in their business through our Dealmaker solution. We believe the unique value we deliver is the result of combining two disciplines; (1) intelligent software applications and (2) deep sales methodologies. Innovation is at the core of our efforts and the Dealmaker intelligent software platform is the engine driving revenue growth for our customers.
To deliver on our promise, it is critical that we can view the market through the eyes of our customers – and in the context of mobile, we need to understand how our customers themselves can deploy mobile solutions, and how their customers are using mobile in their day-to-day interactions.
If you are a sales person, sales leader or business leader, then you should join me in seeking a deep understanding of how to make your sales person’s interactions with their customers more effective. How will she and her customer communicate, learn, and engage, both internally and externally?
The short answer is that the business world in which they operate is: always on, increasingly connected, and peppered by frequent interruptions.
Attention span is short.
Instant gratification carries a premium. Information is plentiful, but effective analysis of that information is lacking.
Yesterday’s news is a valueless currency as we use our mobile devices to learn about business happenings, world events, and personal activities in a torrent of up-to-the-minute information flow.
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A business thrives when it can influence its customers’ thinking in a positive way. In order to do that, the business must first understand how the customer wants to interact, before the sales cycle, during the sales cycle and after the sale. To change the mind of the customer you first need to get inside it, and understand what is important to the specific profile of target buyer that you seek to influence.
According to Pew Research, smartphone usage in February 2012 is most prevalent among the 18-29 age group, 66% of whom own a smart phone, followed closely by the 30-49 age group (59%). Other key indicators of smartphone usage are the level of household income where smartphone penetration is at 68% among the $75,000+ income group; 60% where users are college educated; and men (49%) slightly outpace women (44%) when it comes to smartphone adoption.
The accelerating pace of change
And as I mentioned earlier, the pace of change continues to accelerate. Looking just at the last ten years, we can observe the rate at which different technologies were adopted.
Starting with Apple’s iPod in 2002, it took nearly a year for Apple to reach the milestone of a million units shipped. RIM’s Blackberry actually outpaced the iPod in 2002 reaching that threshold in 300 days. In a continuing move towards increased mobility, the world embraced netbooks in 2007 and bought one million units in just six months. The time to achieve this level of penetration has continued to shorten and Apple’s iPhone took just 70 days in 2007.
When the iPad was released a whole new market opened up and in just one month, a million users were experiencing new ways to consume information, browse the web and interact online.
The tablet phenomenon has outstripped everyone expectations. At this point in time (April 2012), 20% of all US adults own a tablet device. Propelled by an unparalleled user experience, increased bandwidth availability, and a drive for instant access everywhere, tablet ownership almost doubled between December 2011 and January 2012.
When the iPad 3, or New IPad as it was called, was released in March 2012, Apple shipped three million units in the launch weekend, making the time to reach a million less than one day!
The number of iPads now been sold by Apple is outstripping laptops sales from any of the traditional manufacturers.
As we reflect on how to equip our sales teams to interact with their increasingly mobile customers, we need to consider how they learn, how they use our business systems, collaborate, and communicate; all through the lens of a mobile worker. Using an iPad (or other tablet) in a sales meeting changes the dynamic of the meeting. The psychological barrier that accompanies the traditional sales person presenting from behind the lid of a laptop goes away. Customers become involved and reach for the sales person’s iPad to run the presentation themselves, or, in a software demonstration, they often want to take control and see what happens as the swipe, tap and pinch.
Workers leave their iPad sitting around on their kitchen table, always on, always connected, a portal to their corporate information systems, their daily news sources, or their learning environment. Skype or Facetime calls from iPads, iPhones or other similarly equipped devices puts video interactivity just a tap away, and new and more intimate communication norms are emerging.
As you develop your strategies for your sales force in 2012 and beyond, I’d encourage you to ask yourself if you’ve considered whether you’ve adequately factored in this unstoppable force. Are all of your systems fully mobile-ware? Can new hires learn about your company, your products, your customers, and your target market from their mobile device? How much have you thought about the shortening attention span of learners and users alike that accompanies the mobile mindset? When your managers seek to support and coach their direct reports, can they find the information they need on their mobile device, and collaborate with them in that mode?
Most new technologies go through two phases of adoption; the first is when we find new and better ways to do things that we already do, and the second – and definitely more exciting phase – is when we uncover things that we can now do that we could never do before.
Now is the time to Carpe Tabulam – seize the tablet. (I’m sure the Latin scholars out there will correct any inaccuracies in my grammar.)
As ever, I’d welcome your comments.
[The next post in this series will explore the impact of Social Networks on selling. If you want to be notified of new blog posts you can always subscribe at the top right of the blog here, or follow me on Twitter @dealmaker365]