Goodbye Wallet – Will mobile phones become future credit cards?

No, I am not a big fan of wallets – only if those are filled with the right light bank notes… which not very often is the case. And I am looking forward to days when my back pocket can get rid of the heavy weight of useless coins that don’t buy big things, products or services. Now, the future seems to be nearer than I thought…

Near field communication (NFC) seems to become the rising technology enabling us to pay with our mobiles in the future. Startups like Square and some programs from brands like Starbucks and Google Wallet kick off a new era where mobile payments becomes popular today.

Gplus has created a nice infographic that nicely and easily explains how the technology works and how fast the mobile payments market is emerging and what might happen in the next few years.

Spot On!
Keynote speeches like the following on the future of mobile payment will also increase the speed of evolution in this field…

How do you think the mobile technology needs to evolve and be made safe for mainstream consumer use? Would you still want a receipt for your purchase? Will this evolution in payment (if it is one) really save time? Share your views…

Outlook or flashback? The (mobile) reward advertising model…

About 12 years ago, when I was about to join silicon, I remember my first meeting in the Chelsea office. I got to know the founders and management team in London and we had first discussions about the future of the business model. It was all very exciting to be in the UK, talking business with that innovative team that was reaching out to the big VC’s for more venture capital as web TV and community building seemed to have been the new rising starts for the next hundred years. And today all business is focussing on mobile…

At that day, we were brainstorming opportunities how to engage users in advertising, and how to reward them. Reward them, when they were watching the pre-rolls at our daily (on-demand) three minutes news show, when they were clicking on display ads, when were reading articles that might fit their business needs and then send them personalized advertising… and reward them when paying attention to any forms and activities of sponsored areas.

To be frankly open, the time was not ready for these types of advertising rewards from a user perspective (as well as the ad industry understanding the capabilities). However, we thought about clever loyalty programs and how to let users participate in the revenues we are generating. As we were working in the B2B scenario it was even more difficult to get this into the heads of our users. I remember, we even tested the silicon point reward model and had a personalized point counter on our side for some days. Yes, we were quite ahead of our times…

So, where are we today with the reward advertising model?

Some weeks ago, I met Julian Fourgeaud at Rovio (Angry Birds) when I was speaking at the istrategyconference in Amsterdam. Julian told me all about the opportunities they have with their mobile gaming business. If you think about their reach – Angry Birds just cracked the 200 Mio. downloads barrier- it all makes perfect sense. I was surprised how much time people spend with the game, and how addicted people became during the istrategyconference dinner (just ask my kids…) but wondered how to make a clever advertising model out of it. And I thought if reach is as benefitial as relevance form an advertising point of view. But that is another story…

Today, I was reminded of the old silicon days. I came across a new business model which is called kiip. Their business is quite simple. A code is implemented in a game which is basically an ad. The ad is a reward points model or coupon that shows up in mobile games when people achieve certain high-scores or levels in the game. So, when you beat a level, you might get a coffee from Starbucks or a discount from MINI’s merchandising shop. Or you just collect points via their loyalty schemes which motivate you to think about purchasing their latest products.

Here is the video how kiip works…

Kiip: An Introduction from kiip on Vimeo.

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There are so many advertising opportunities or loyalty programs (i.e. like Multiply to increase the worth of brand fans) these days that won’t be as offensive as the traditional advertising model. HOWEVER, in my eyes there is one thing which needs to happen: Personalization. With silicon those days we saw who was logged in, just like Youtube, Facebook and Twitter do. So, personalized reward advertising ad models should no be a challenge anymore (under given permission). Still, I cannot see any of these rewarding systems really working for now. Or is Facebook Stories heading towards this idea? Groupon, Foursquare and Gowalla could come up with similar ideas if they just collaborate with the guys from kiip. And if credit card providers as well as loyalty card providers would change their strategies and group with these guys, chances would be amazing to make advertising engaging, personal, rewarding and finally efficient for brands. We would get offers in a personalized format, at the right time and in the right environment.

What do you think about reward advertising models? Is this an exiting area to focus on? Do you fear that data privacy (remember this Google spoof commercial…) becomes an issue as usual? Let us know…

News Update – Best of the Day

The latest market outlook by Deloitte predicts that in 2011 social networks are likely to surpass one billion unique members and may deliver over 2 trillion advertisements. Although this sounds impressive, it is modest compared to other media, the CPM remains low and the market share remains at only 1% of the global online ad spend. The per member annual advertising revenue is approximately $4 which implies total 2011 advertising revenues of about $5 billion.

Will the publishing industry see a revival of print again? Everybody says social media is challening the print publishing industry. All of a sudden, the Content Marketing Institute has launched a media that is in some way a spin-off of the modern social web development, Chief Content Officer. The circulation is 20,000 marketers, with additional digital distribution. Yes, obviously there is a “digital spin” off as well…

Nike signed a big sponsoring agreement with the national football association of France (FFF). After years with Adidas, France signed a contract with Nike for their national football dress. And then they did this fantastic commercial with reference to my most admired work and poem from “Cyrano de Bergerac”, ending with the famous words “J’ai touche!”. Let’s wait and see what the French team will touch us in EURO 2012…

PS: At Starbucks mobile payment becomes reality. At least in the US where you can swipe your phone in front of a scanner that is checking your Starbucks account.

News Update – Best of the Day

Tim Bernes-Lee, the founder of the WWW, last week stated that “journalists need data skills in the future”. In his speech at a panel he concluded that…

“Journalists need to be data-savvy. These are the people whose jobs are to interpret what government is doing to the people. So it used to be that you would get stories by chatting to people in bars, and it still might be that you’ll do it that way some times. But now it’s also going to be about poring over data and equipping yourself with the tools to analyse it and picking out what’s interesting. And keeping it in perspective, helping people out by really seeing where it all fits together, and what’s going on in the country.”

In my eyes, Berners-Lee’s point is that journalists need to be able to tell the story in ways which tells a story to the reader. The technical point isn’t for the readers but for the journalists. He’s basically saying that data enables new story to come up. Aggregation of content is the future and analysis of data will become more important than just quoting the data, the way journalists work today.

China has not been the main country for Social Media usage. Time is changing though. A new Ogilvy report shows some significant changes – today Social Media in China is “mainstream reality”. The main Social Networks seem to be Renren (a social network for students), kaixin, 51.com and the market leaderQQ.

Sustainability is the key to Social Media success. Companies let their social activities explode, or are getting better but most of them have don’t think about sutainable effect. Custom Communication created an index that identifies and ranks 120 companies that are using social media in sustainability communications. Obviously, the social-media innovators like Pepsi, Dell, Starbucks, IBM and Ford are leading the bunch. A very positive example for Corporate Social Responsibility (CSR) is General Electric, whose “Ecomagination challenge is raising the bar for how companies can demonstrate their commitment to society in an engaging and social manner,” says Matthew Yeomans, co-founder of Custom Communication.

News Update – Best of the Day

Finally, Twitter starts their first trials rolling out their first advertising into individual users’ Twitter streams. The first clients are from Starbucks, Red Bull and Virgin. This new monetization strategy called Promoted Tweets was announced some while ago and will kick off addressing Hootsuits’s 175 million users with showing them paid tweets. Interested to see how the users will react…

LinkedIn powers the company profile pages by integrating new company pages. Companies can now “showcase their products, services and associated recommendations”. The company pages allow brands to showcase recommendations from their customers which becomes benefitial for the brand virally and credibly on LinkedIn. When memebers on LinkedIn endorse products or services of a brand, their recommendations become visible to all of their connections. The viral effect is obvious. Thus, brands get some of the most credible, authentic endorsements of their products on Company Page’s Product tab. The question is whether the user likes the idea to become a brand testimonial…

Although I am not a huge fan of plastic toys, I have to admit this Barbie commercial gets the message across. “When I grew up” is a good example of kid ads targeting adults…

Can Facebook Fan Pages become the new brand websites?

One of the latest articles of AdAge highlights the reach of the biggest Facebook fan pages of brands.

The article makes clear that many marketers have more success these days with their social media presence than with their traditional “owned media” – their brand sites. The question arises if the new “owned media” will become the Facebook sites where companies invest a lot of effort in these days. In just one year the shift from “onsite to offsite” becomes obvious when we can obey that Coke’s brand website and NabiscoWorld.com are showing a massive decline in traffic figures based on Compete data. Only Starbucks seems to maintain their brand sites web-traffic with significant e-commerce traffic success.

Many marketers are still not quite sure how and in which way to get engaged in all the social media hype. And if they do, a recent study by the Brand Science Institute shows that 73% had to show ROI figures after 12 months, although only 27% had a clear understanding of who their customers are… and probably none of how they interact on the social web. And 92% (!!!) were not aware of their Facebook dependency…

The expectations are high on social media… and especially when Facebook becomes part of the social media strategy. Posts like those of AdAge suggest that Facebook fan pages will become the new brand sites, or at least replace the importance of traditional brand sites.

And now to the experts… What is your take on this?

Social Networks – Are niche communities the future of networks?

More often people are fed up with all that self-referential talk of individuals on social networks. Or, companies which do not understand the idea of an online conversation, including clients and not just broadcasting the old-fashioned marketing and sales way. Just today, I had some people in my Facebook stream and my Twitter updates telling me how the weather was, what their kids had for breakfast, or that their wives don’t understand their affinity to social networks. OK, nice, fair enough… Interesting? No!

And then I hear my wife saying… “Why keeping up the contact to so many people if there is no option to even get actively into 10 per cent of the conversations happening in these online relationships?” True, but you never know when some contact might need you, or vice versa.

Checking Facebook and staying up-to-date on Twitter becomes challenging on a busy day, with kids that are happy to see dad in the evening for some minutes, and long-time friends complaining why they don’t hear anything from you anymore.

So, is there another trend coming up in the future that might go for niche social networks, niche communities? Why? We had that offline for ages. Years ago, people have spend hours in their football club bar after a training session, or went to book readings to enjoy the discussion afterwards, or went to a vernisage in order to “philosophy” about the latest gallery exhibition with someone they don’t know. The reason for doing it was just their share of interest in something, a hobby, a passion, or a kind of affinity. So, are we seeing social networks for art geeks going on virtual gallery tours in the future?

My father was telling me that he uses a Bridge community and plays daily for one or two hours. A friend of mine is a DJ and he spend hours in communities for DJs like My DJ Space or Mix DJ. Some even still (or again?) love vinyl and become members in a community there. These music enthusiasts do nothing more or less than share their interest in being DJs, and obviously loving to mix tapes. The special interest is the centre of their community engagement.

Some years ago, somebody approached me with the idea of an international golfer network (http://www.golffriends.com/welcome/community). As I love playing golf (though don’t have enough time to play often…), there was some interest to become a member, if not more to become more engaged in the business idea. But then, time and the thought of managing many private interest networks -as I have quite some hobbies- next to my business networks and the top networks made me not investing too much time in that vision. Maybe I should have done…

Mothers share their passion for coffee on Cafemom, and if we think about all the Starbucks communities it does not surprise us. Games exchange ideas and thoughts on Raptr, or real social activists use Care2. Even more “nichy” is the passion of men for their moustache that they express online to the public. And others share their interest in Whisky or Wine networks.

So, my question is if niche networks could take a big portion of the market share of global social networks (Facebook, Twitter, Myspace, etc.) in the future? Can you see people going away from the self-gloryfying popular networks that the mainstream web user is engaged in? Tell us of niche networks you know and how you see this trend?

Product strategists think social innovations could increase

If there are more and more people engaging with brands on the social web, the opportunity to collaborate with the social community becomes a lucrative meaning for brands – and their product strategists. These managers could open up a new “external R&D department” when they use social technology in order to increase product innovations by integrating their customers in the process of product creation and development.

A recent Forrester study of 181 consumer product strategy professionals from companies around the globe states that product strategists in companies strive for social innovations. Though Forrester makes clear that social innovation is not yet where it should be from the product strategist’s point-of-view. The study shows the familiar picture that we see in more or less all departments in companies: It is still early days also for product strategists to work with social media. And only some leverage social media in favor of social innovations.

Still it seems to be a big challenge for companies to find their way from being engaged with their customers on the social web to understanding the impacts and chances to social innovation management. This becomes clear when we see that 83% of the companies use social media to drive customer conversation but then not even half of those have product teams that influence product design, creation, or strategy by using social media.

It is also surprising for me to acknowledge that it is not the resources that are lacking. More than two-thirds of the responding product strategists have dedicated social managers or teams. On the one hand, it lacks the right technological connection bridges between the different company departments. On the other hand, when not more than one-fifth have formal policies in their companies for sharing data from social technologies with product teams, the road to succeed with social co-creation efforts seems to be long.

Spot On!
The best way to produce the right products for your customers is to ideally let them inspire a business. In the past, we had focus-groups which were cost-intensive, time-limited and time-consuming. The concept of social creation and social innovation can work on a day-to-day innovation platform. Just think of Dell Ideastorm, MyStarbucksidea, Adobe’s ideas lab or the IKEA Hacker approach. Nevertheless, companies should be aware that customers very often need or want some kick-back for their inspirational efforts. So, in my eyes the point of giving away some form of incentive will be necessary to get such communities started and make them sustainable.

Or will customers in the future co-create for free to receive better product-price-quality? What do you think?

My Starbucks Case Study – Connecting Offline and Online

One of the famous examples we all hear when we join webinars and seminars on how to leverage your brand with social media is Starbucks. Starbucks is using Facebook and Twitter for customer care and yes, we can say that to increase sales. Case studies are a lot on the web and I often talk about them in my presentations. Asking my self if there is way to improve for Starbucks when connecting offline and online…

Now, sometimes you become part of a learning curve for brands as a prosumer. It happens quicker than you want or expect. And it happened to me at my last Starbucks visit.

When I was paying my bill, the friendly women at the counter started talking about my nice netbook. She was actually getting me inside of a comfortable small talk that was obviously intended already before I accessed their coffee shop. It is a part of their customer care strategy which connects offline and online in an interesting way.

When the cash desk threw out my receipe, the woman gets a smile on her face. She cut in our conversation with a “Hey, Congratulations! You have just been selected to take part in our customer online survey“. She hands over the recipe and explains that I have to answer some question and then will get a coupon for a free tall drink. I thought for myself “Nice idea!”, let’s see if they connect it with their social media efforts.

Now, obviously they were lucky in some way that I am a (business) blogger and always pay attention to such efforts of companies to look after their customers. I do not know whether she saw that I have logged in on that Starbucks shop via Foursquare while standing at the cash point. That would show how well trained the people at Starbucks are. She definitely knew that I will be working and going online during my stay in their shop. If the cash maschine has a customer care survey button, I don’t know. Anyway…

So, I took the survey and thus can interpret from their questions that there is an intention to get customers into a conversation. “Cluetrain in the offline world” comes to my mind. The survey itself is a normal five minutes multiple choice research. Nothing special. In the end, I get the code for my free drink, write it on the coupon and get my drink. Their customer care process works!

Spot On!
Now, why do I write about this experience? Starbucks is said to have a good social media approach -some might call it strategy- to work with their customers. But when the survey was done, I was surprised that I did not find a button to become their “fan” on Facebook. Which actually would lead me a step further in their process to think about their customer care card (see their app promotion). Or to become a follower of their Twitter account, so I can spread the word about my free drink and praise their cool customer service approach. And now, I am asking myself, is it better that they don’t ask for too much brand commitment. Or is it normal to give when you get? Maybe you can help my find an answer…

News Update – Best of the Day

Just some weeks ago, I have been talking about the idea of replacing loyalty cards by social networking customer service to drive customer engagement. Now, the New York Times has extended the idea by the integration of location-based advertising using Foursquare… and of course replacing loyalty cards by social networks activity and mobile apps. The idea seems to be moving from trend to standard…

Often the question comes up which brands are the most valuable in the world. Millward Brown’s Optimor BrandZ Top100 Most Valuable Global Brands report gives us some insight. The key findings…

- Google is the most valuable global brand worth $114 billion (2nd is IBM with $86 billion, 3rd Apple with $83 billion, Microsoft was fourth with $76 billion.
- Social Media is a winner: Facebook has a brand value of $5.5 billion. Use of social media was a key trend across many of the successful brands this year, i.e. HSBC’s Expat Explorer online community.
- Strong brands such as Samsung (80% growth in brand value) and Starbucks (17% increase) are evidence that businesses with strong brands recover from adversity faster.

Heineken commercials know how to dive into the hearts of their main target group. “Men with talents” is another fantastic example after their “walk in fridge” idea… Sorry ladies, but we man love it!

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