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Wednesday, October 27, 2010

Mobile Business Strategies - PARTNERSHIPS:

Mobile phones are no longer just a means of calling another person. In several countries, mobile devices are used to pay for merchandise, receive time sensitive information and send e-mail messages. Additionally, corporations use mobile phones to access critical business information and send tasks to field workers, regardless of time or location. In recent years, several global mega-trends have started to emerge, creating exciting business opportunities and concepts. Widespread usage of credit cards, the phenomenal explosion of the internet and rising mobile phone penetration have paved the way for advanced mobile applications that enable both consumers and corporations to access personalized services. Therefore, mobile devices are becoming an important part of the lives of ordinary people. Using a mobile phone, they can buy a soft drink when passing a vending machine, receive e-mails immediately after they are sent, order a taxi without knowing their current location and get notified if they forgot to pay the electricity bill.

Streamlined business processes can be developed by integrating mobile applications with existing systems. Aligning mobile commerce with business goals and strategies is important in order to benefit from new technologies. aligning mobile commerce with business goals and strategies is key in ensuring that faster processes and communication.

Mobile business can be regarded as an exchange of good, services and information using mobile technology. It includes communication, transactions and different value added services that are made can be made available through mobile terminals.  In relation to this therefore mobile commerce refers to transactions with monetary value conducted using mobile internet. Such transaction will include business-to-business, business-to-consumer and consumer-to-consumer transactions.  Mobile commerce is a subset of electronic commerce with respect to technical issues.

Partnerships – The way to success in the mobile era:
As potential markets open up as a result of emerging new technologies, companies keep looking for partners to help in achieving the complex mission of service delivery. Three players are positioning themselves in the middle of the mobile value chain: operators, financial institutions and portals. However for these players to succeed they need partners.  There’s need to study the mobile value chain when looking out for partnerships. This enables one to see the emerging possibilities and niches resulting from the dynamic market structures and totally new business models.

The mobile commerce value chain is complex because it involves multiple players within the mobile commerce business environment, each having different backgrounds and interests. These include the traditional phone operators, internet companies, content providers, and completely new mobile commerce start-ups, each looking for revenue potential and niche markets. Synergy and cooperation between each of these entities is important to ensure end-to-end service delivery. Revenue sharing, customer ownership and transparent cooperation are some of the most critical factors in the mobile commerce value chain. With partnerships, companies can acquire skills and expertise outside their core competence. Most mobile commerce players prefer direct customer relationship and a strong brand, partnership therefore should be based on common goals and clearly defined objectives. Basically there four main components in the mobile value chain namely the network composed of back-end system, mobile commerce technology (like payment solution, security solutions, software platforms), content provision and aggregation as well the interface which includes portals and the devices used by the mobile users.  Partnerships can be made in any of these components. Mobile commerce technology is full of opportunities, systems integrators cooperate with portal providers to create scalable mobile platforms. Dotcom companies innovate payment and security solutions. Without doubt therefore m-commerce technology is one of the most promising fields in the value chain. Application developers need strategic partnerships most especially with the network operators if they are to succeed. Payment solutions offer another interesting area in M-commerce technology with mobile operators having direct billing relationships with customers, so they can be key positions to offer transaction services for third party merchants. Currently micro-payments can easily be billed on mobile phones. Because operators may fill uncomfortable with the risk of bad debt, they are most likely to form joint ventures with banks to offer payment solutions or their customers. With this, banks are bound to be removed from the value chain since customer ownership favors mobile operators who retain a billing relationship with their customers. In this case banks should seek partnerships where customer information can be shared and the brand recognition of partners would be equal.

Content is a key factor in making mobile services that attract users and keep them coming back. Traditional content providers are engaging in partnerships with numerous intermediaries of the mobile commerce value chain to benefit from the promising market.  
A good example is nu.m8, the world’s first GPS locator designed exclusively to locate children. They provide child location information using both GPS and mobile CELL-ID technology. This content is streamed via secure internet portals or mobile phones.

As mobile terminal penetration increases, competition in mobile services will even be tougher than today and only companies that are able to provide exciting and convenient services to consumers will survive.  Content providers should therefore look for ways of processing information using modern technologies such as personalization and location. They should seek partnerships with content aggregators, gathering information from various sources. Small content providers in particular are vulnerable without strong partners and hence partnering with content aggregators such mobile portals ensures that they can get regular revenue by increasing their visibility in the market. To achieve a good share of the market, content providers should differentiate their services. Technical differentiation and human expertise offer two ways of processing information in order to create differentiated services for content providers. Human expertise is needed in creating interesting stories and describing the people behind them. It’s something that only those with the ability to write creatively are able to do. In contrast, technical differentiation uses software tools and custom solutions in order to process information.

Content aggregators gather information from various sources and therefore provide content providers a channel through which they can market their information.  They should be able personalize aggregated content and optimize it for the needs of individuals.  It’s important they partner with systems integrators and application developers so as to create personalized content. Systems integrators can help in integrating billing systems, customer relationship management software and other corporate systems into the service. One way to process content is to attach location coordinates to it. That way content becomes local and users can access services more easily. Mobile operators are capable of determining the location of individual handsets and therefore to create location based services by content providers will require partnerships with them.

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