Mobile is everywhere. Stats on the numbers and the size of the industry change constantly but it’s common knowledge that it will be big. Now that 75% of brands have tried mobile what are the key stats that will help guide future decisions? Julie’s state of the industry will provide insights into what’s currently happening in the mobile space and a five-year forecast. She will also provide best practices in developing an outstanding, transactional mobile experience. Her expertise in mobile commerce will give you insights into what to expect and how to prepare for the future of mobile.

1. 1 © 2011 Forrester Research, Inc. Reproduction Prohibited

2. Mobile Commerce: Current & Future Trends
Julie Äsk
Vice President
Forrester Research
September 22, 2011
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2011

3. Mobile has the potential to be even bigger
or more disruptive than the Internet.
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4. Mobile will be the primary digital
connection to your customers.
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5. Key Questions
 How are consumers using mobile today?
 What are the opportunities for companies to leverage mobile
throughout the customer’s journey?
 What new opportunities should companies pursue to create and
monetize experiences that leverage the mobile phone?
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6. How are consumers using mobile devices
today?
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7. People of all nationalities and incomes have
sophisticated handsets
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8. Consumer spending is increasing and with it ad spend
and investment in mobile services
• 12% research; 4% buy
• Smartphone owners: 30% research; 11% buy
• Forrester eBusiness group estimated direct spending on mobile to be about $6B in 2011
Consumer Spending
Mobile Investment
• Web sites Marketing Spend
• Applications • Spend mostly on display ads,
• Infrastructure search, messaging and
• Avg. investment ca. $170K by applications
online retailers • >$1B in US in 2011
Base: 7,156 US online adults with a cell phone
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Source: North American Technographics Benchmark Survey, Q2 2010 (US, Canada)

9. Portable media or computing platforms will grow with
phones continuing to dominate
Millions of US consumers with each device
Five-year forecast of mobile devices
140
120 Smartphones
100M
100
80 Tablets
60
40
eReaders
20
0
2008 2009 2010 2011 2012 2013 2014 2015
(F) (F) (F) (F) (F) (F)
Source: Forrester Research Forecast (2010-2015, US)
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10. Overall, few consumers use their mobile phones to
research and purchase products
Which of the following activities do you do on your primary cell
phone or handheld wireless device AT LEAST MONTHLY?
29%
Smartphone 17%
10%
10%
All mobile 7% Research products for
4% purchase
8%
Receive
QMD 6% coupons/promotions
2%
Purchase products
1%
Feature Phones 1%
0%
0% 20% 40% 60% 80% 100%
Base: 8,352 US adults with a mobile phone, 2,421 Smartphone users, 1,841 QMD users, and 4,091 feature phone users
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Source: North American Technographics Benchmark Survey, Q2 2010 (US, Canada)

11. Smartphone owners, however, do
Which of the following activities do you do on your primary cell
phone or handheld wireless device AT LEAST MONTHLY?
29%
Smartphone 17%
10%
10%
All mobile 7% Research products for
4% purchase
8%
Receive
QMD 6% coupons/promotions
2%
Purchase products
1%
Feature Phones 1%
0%
0% 20% 40% 60% 80% 100%
Base: 8,352 US adults with a mobile phone, 2,421 Smartphone users, 1,841 QMD users, and 4,091 feature phone users
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Source: North American Technographics Benchmark Survey, Q2 2010 (US, Canada)

12. Handset ownership alone does not tell the whole story
We placed US adults into six groups based on their mobile phone usage to create our Mobile Technographics
characterization. The groups are defined by the extent to which the mobile phone user has adopted mobile data
services, her frequency of use of these services, and the level of sophistication in the mobile applications they
use. Increasing mobile
sophistication Mobile Engagement Opportunities
Applications
Most advanced phone users; Access mobile
SuperConnecteds Internet at least weekly or do multiple
SMS services and alerts
29% advanced activities monthly or more
Mobile Web
Entertainers Listen to music, watch video, or play games
22% at least weekly
Connectors Productivity users; over 25% of primary cell
8% phone use if for work purposes as well as do
advanced activities at least monthly
Communicators
17% Communicate heavily using data
(SMS, MMS, email, or IM at least monthly)
Talkers
Little to none
26% Use phone primarily for
voice
Inactives
10% No mobile phone
Base: 10,802 US Adults
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Source: North American Technographics Benchmark Survey, Q2/Q3 2011 (US, Canada)

13. Consumers also look to tablets for online shopping
July 2011 “Why Tablet Commerce May Soon Trump Mobile Commerce”
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14. How can mobile technologies be
used to engage consumers on
their journey today?
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15. Mobile can support consumers throughout their journey
• Branding
• Consumer reviews
• Registrations
• Coupons/promotions
• Sweepstakes
• Nearest dealer/retailer
• Tools (e.g., product selection)
• Location-based
• Video (Demonstrations)
marketing
• Price comparisons
Discovery Influence • Product comparisons
• Product information
• Ratings
• Store inventory
Repeat Purchase
• Accessories
Sale
Manufacturer • Lead generation
• Rebate
• Sales
• Maintenance
reminders Ownership
• New Products
• Promotions • Community
• Replenishment • Customer Service
• Ownership guides
• Services (e.g., Nike)
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16. Branding is not limited to rich media within
applications and banner ads
Discovery /
Demonstration Influence
What to buy Where to buy
Repeat purchase
Sale
Repeat Post-Purchase
purchase Interaction
Ownership
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17. Branding is often done with voting or sponsored
alerts
Short codes • Radio and TV programming
along with “live” events are
most often associated with
using SMS as a cross-channel
Simple Key engagement opportunity
Words • Voting is one of the most
popular applications used
• Typically, the ad space within
the returned messages is
sponsored. In this
example, the branding was
part of the on-screen
promotion of the voting from
Burger King
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18. Charmin’s “Sit or Squat” application has been a
monster hit
• Sponsored content
• Tens of millions plus
downloads
• Offers utility
• Promoted on Web site
Source: iPhone screenshot: Charmin mobile application
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19. Progressive recently used Shazam to tag audio
content and link viewers to mobile content
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20. Sudafed used these ads in airports this past winter –
highly contextual
Source: iPhone screenshot: Sudafed website
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21. Zappos links to an interactive Web page that allows a
consumer to mix/match outfits on a printed page
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22. Too many branding exercises with mobile media fall short
– mostly because content is not optimized for mobile
Beta LED Mecho Systems
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23. Influence is also marketing
Discovery /
Influence
Demonstration
What to buy Where to buy
Repeat purchase
Sale
Repeat Post-Purchase
purchase Interaction
Ownership
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24. Delta offers an interactive Web page (QR code
trigger) with product features
Real Simple Magazine
September 2011
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25. Ryobi uses branded QR codes on their product tags
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26. The video demonstrates how the product is used
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27. Price comparison applications offer conquest
opportunities
Scan Online Prices Buy Locally
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28. QR codes at the shelf help consumers compare products
Users scan the
barcode with
their mobile
device
High end
products, in-
store, will have
QR codes for
customers to
scan
Scanned products are
added to a list on a
user’s phone, which
brings up item details
and can be compared
with multiple products
Source: Best Buy
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29. Shopkick rewards visits, browsing and scans
A consumer collects 50 Promotes an “award” for Once the consumer arrives, they
“kickbucks” once they walk going to the Home Theater are immediately awarded points.
through the door. Department.
Source: iPhone screen shot: Shopkick mobile application
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30. Stop&Shop has been working with Modiv Media for years
to execute on targeted, real time, in-store marketing
Users scan items with the
handheld device
Grab your
device by
swiping your
Stop&Shop
loyalty card
Guests can look
through their The savings
whole grocery button brings up
list and know a list which the
the final cost user can scroll
before they get through
to the register
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31. Mobile also plays a role in direct commerce
Discovery /
Influence
Demonstration
What to buy Where to buy
Repeat purchase
Sale
Repeat Post-Purchase
purchase Interaction
Ownership
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32. … and shop with their phones in subway stations
in Korea
http://www.zdnet.co.uk/blogs/jacks-blog-10017212/virtual-supermarket-
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33. NFC is most often associated with payments, but
NFC will also be used to connect consumers to info
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34. Starbucks allows users to pay with their phones and
reload prepaid cards
Source: iPhone screen shot: Starbucks mobile application
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35. Ownership and loyalty offer more future opportunities
Discovery /
Influence
Demonstration
What to buy Where to buy
Repeat purchase
Sale
Repeat Post-Purchase
purchase Interaction
Ownership
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36. GE’s Transformer app for the iPhone and iPad allows
field engineers to monitor equipment remotely
One of the
strengths of the
application is
rich, graphing
tools.
ROI: Proactive
maintenance
extends the life
time of a wind
Offers interactive mapping of
turbine.
transformer locations.
36 © 2011 Forrester Research, Inc. Reproduction Prohibited Source: http://econsultancy.com

37. The sales and finance staff at Life Technologies use
Roambi for sales data and to track customer activity
This view
shows account
manager
activity.
Customer ROI: More
activity is also efficient sales
available. process and
real-time
decision
making.
The application integrates with Siebel –
their CRM solution – to pull account
37
information.
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38. Apps can also act as an in-depth information source
• Research
• News
• Useful Links
Genentech BioOncology • Conferences/Events
• Polls
• Customer Service
Land O’ Lakes could offer analogous
Genentech also offers a “Fight
applications to their farmers, horse and
the Flu” application –
cattle owners, etc. again, the focus is on utility.
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39. Flowers are sold with tags with 2D bar codes with
product and care information
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41. Products like these will ship with companion mobile
services
Running Shoes Cars
TV’s Printers
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42. This will be the Era of Experience.
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43. What are the emerging opportunities?
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44. The future of mobile is context.
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45. Forrester defines context as
“the sum total of what your customer
has told you and is experiencing at his
moment of engagement.”
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46. Context includes:
 Situation: the current location, altitude, and
speed the customer is experiencing
 Preferences: the history and personal
decisions the customer has shared with you
 Attitudes: the feelings or emotions implied by
the customer’s actions and logistics
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47. Opportunities to utilize the phone differently than the
PC will grow over time – today it’s basic
High
Level of Sophistication
• Consumer behavior
• GPS Basic Context
• Time of day
Low
2011 2012 2013 2014 2015 2016
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48. Google maps utilizes user location to tailor results
User Location Supplied “City Name”
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49. Some companies are already beginning to add a
layer of intelligence to this context
High
Level of Sophistication
• Consumer’s purchase intent
• In my store? In a competitor’s store? ... add intelligence
• Within one hour of flight? 2 days?
• Consumer behavior
• GPS Basic Context
• Time of day
Low
2011 2012 2013 2014 2015 2016
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50. Intelligence added to location will dictate consumer
experiences on mobile
Retail Example Based On User Location
In-Store Competitor Store Home
• Barcode scanning • Coupons • Coupons
• Consumer reviews • In-store inventory • How-to videos
• Coupons • Nearest “store” • In-store inventory
• In-store navigation • Pricing • Research tools
• Lists (e.g., wedding) • Promotions • Shopping list build
• Loyalty • Store hours
• Promotions • Store location
• Shopping lists • Weekly/Circular
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51. Contextual use of time will help prioritize home page
Airline Example Based On User Time
- 2 days - 2h Flight + 2h + 2 days
• Arrival time • Customer service
• Change reservation
• Food order • Mileage status
• Reserve seat
• Movies • Reward travel
• View reservations
• Wi-Fi • Upcoming reservations
• Check gate • Ground
• Departure time transportation
• Lounge access • Lost luggage
• Upgrade • Navigation
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52. A host of new technologies will appear in cell phones
Technology Opportunity (Examples)
• Distance measured, gesture control
Controls
• 3D Cameras
• Biometrics • Security, access cards, ID
• Conversational Voice Recognition • Verbal command
• Near Field Communications (NFC) • Payments, ticketing, and security
• 3D displays • Augmented reality, video output
Displays
• High resolution displays • Media consumption, bar codes
• Micro-mirrors • Image projection; pico-projectors
• Touch inputs (fine-tuned)
Data Collection
• Accelerometers (detects motion/tilt) • Phone orientation as control, pedometer
• Chemical sensors • CO detection, food freshness
• Gyroscopes • Gesture control, navigation, games
• Magnetometers • Directions – “Is it over there?”
• Microbolometers (infrared) • Night vision; heat; light/dark
• Pressure sensor • Height in buildings
Source: AMFitzgerald & Associates, Yole Development and interviews with Atmel, InvenSense, and Sharp
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53. Sensors in phones are adding capabilities computers
don’t have
High
• 3D cameras/displays
• What floor in building? What aisle?
Level of Sophistication
• Direction consumer facing? … add 3rd dimension
• Light? Dark?
• Augmented Reality (true)
• Consumer’s purchase intent
• In my store? In a competitor’s store? ... add intelligence
• Within one hour of flight? 2 days?
• Consumer behavior
• GPS Basic Context
• Time of day
Low
2011 2012 2013 2014 2015 2016
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55. “Where am I” will have a height dimension
Use elevator “A”
to get to roof top
bar.
Vending machines
is one floor down.
Fitness room is
two floors down
Source: Interviews with AMFitzgerald & Associates and Yole Development
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56. “Where is the nearest dealership” will not require
users to orient themselves
“Is the parts shop this way?”
“Is the nearest
dealership over there?”
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58. The next stage will be change how we control the
phone
High • Biometrics
… fundamentally
• Display technology
• Gesture-based control alter navigation
• 3D cameras/displays
• What floor in building? What aisle?
Level of Sophistication
• Direction consumer facing? … add 3rd dimension
• Light? Dark?
• Augmented Reality (true)
• Consumer’s purchase intent
• In my store? In a competitor’s store? ... add intelligence
• Within one hour of flight? 2 days?
• Consumer behavior
• GPS Basic Context
• Time of day
Low
2011 2012 2013 2014 2015 2016
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59. Voice command:
“Find a fridge.”
Phone assesses Phone finds the
Phone selects Mobile app
size of fridge nearest store with
colors based on checks Wells
possible the fridge in stock
current palette. Fargo bank
at the right price.
account.
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60. And “machines” will have their own mobile
“The load is dry.
Clean filter.”
“Grandma made
tea today.”
“Air pressure low
in front left tire.”
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61. The “mouse’s” days are limited …
motion will control these devices
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62. The phone is breaking free of the PC – moving out of
its shadow – so must you
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63. You have an opportunity to
be ahead of the curve … so
how do you get there?
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64. Forrester recommends the P.O.S.T. methodology for
mobile strategy development
People. Objectives. Strategy. Technology.
How do People use What business What tactics Which mobile
their mobile Objectives should inform our mobile Technology is the
phones today? mobile support? Strategy? best fit?
REACH
OFFERING
VALUE CHAIN
COMMITMENT
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65. Brands can start with migrating online services …
Advanced
Contextual
High Mobile
Today Unique
Cross- Next 2-3 years
Level of Sophistication
Channel
• Migrate services that are
frequently used online AND
Multichannel are mobile appropriate
Nothing (e.g., value in
immediacy, simplicity, and
contextual
Low
Evolution of Services Over Time
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66. … but should quickly start planning mobile-only services
Advanced
Contextual
High Mobile
Today Unique
Cross- Next 2-3 years
Level of Sophistication
Channel
• Mobile-only services will offer
Multichannel consumers incremental value
• These services make use of unique
Nothing device features such as
GPS, camera, NFC, gyroscope, ac
celerometer, etc.
• These services often are built into
applications (e.g., payments), but
could also include messaging
(e.g., GPS fraud alerts) or Web
Low
Evolution of Services Over Time
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67. Thank you.
Julie Ask
+1 415 355 6002
jask@forrester.com
www.forrester.com
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68. Thank you
Julie Äsk
+1 415.355.6002
jask@forrester.com
www.forrester.com
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