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Online trust requires insight into consumers, not businesses

28/9/2017

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​The EU TRUESSEC programme is an inter-disciplinary initiative to foster trust and confidence in new and emerging ICT products and services throughout Europe.  The project intends to achieve this by encouraging the adoption of appropriate assurance and certification processes.

Last week the Digital Catapult (the project coordinator) held a debate entitled “Can you trust digital products and services?”.  One of the inputs to this was a business survey run by Innovate UK’s Knowledge Transfer Network (KTN), which examined issues surrounding trust, labelling and certification.  This found, for example, that 80% of businesses felt that that ICT security certification is a valuable tool to reduce cyber vulnerabilities of ICT products or services.

Cybersecurity is an essential foundation for trust.  Labelling may help in some circumstances.  But neither are sufficient to ensure trust.  For trust, the buyer needs to believe that the seller is offering a product that will do what it claims at a price that is fair, that the seller will be there to help if something goes wrong and that protection is there as a last resort. 

​New and emerging ICT products are frequently subscription-based, with free or discounted entry points and business model based on upsell over time.  Although the buyer is a person, the seller is now invariably a software program and the store is invariably digital rather than physical.  All this makes for a new and complex trust dynamic.  Products will embed sales algorithms built on AI technologies that have the goal of increasing average revenue per customer.  The product will have to learn to create a trusted relationship, even as it tries to extract more revenue from the user. 

The latest survey from Marketing Sherpa reiterates that consumer trust in online channels is far lower than in traditional channels.  Vendors of ICT products will need to shift their thinking from the supply side to the demand side.   A good start would be a behavioural study to understand the causes of reduced trust online and predict what will happen as the product becomes the channel.

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Cloud-based software has its own agenda

8/9/2017

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​If you need to know whether a software application meets your exact needs (for example that it will interface to your current system), testing prior to sign-up is an essential activity.  Many cloud-based applications use a minimalist front end listing the reasons to buy, but not fully describing the functionality provided.  In the ‘Freemium’ business model the customer can play with the application and find out what it can do for themselves.  I recently got a free account with a web conferencing tool to find out whether it would meet my needs.  

But testing was painful.  I was constantly presented with messages asking me to ‘upgrade’ and buy a monthly subscription (with great savings if I paid for a year in advance!).  The navigation continually pointed me towards features that I could not use as they were unavailable in the free version.   Support via online chat yielded the bare minimum in terms of answers.  That company lost a prospective customer.

Computer software used to be sold to us by people, a natural person to person process. Now it is the software itself that (often covertly) sells to us, which for humans is unnatural.  Instead of selling to us just once when we first buy the product, software sells to us all the time we are using it.  It constantly upsells the next subscription tier, or the purchase of extras, which can leave the user feeling irritated or manipulated.  Cloud-based application providers need to carefully consider the integrity of their offering if they are to establish a loyal customer base.
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Location-based advertising becoming ever more accurate

1/6/2017

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​​The power of location-based advertising is increasing.  We have now reached the point where vendors are so confident in their offering that they are prepared to price based on success fees, rather than simply recover campaign costs.  Why are they so confident?  Three reasons:
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1. Improved quality of location data.  By combining GPS and IPS (Indoor Positioning System) data, software can discard questionable data points, leaving only a high-quality data set.



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​Image by Bart Paden
midwesterninteractive.com
2. Collection of large volumes of historical data.  Big data tools mean that we can now collect, store and use datasets large enough to reveal real behavioural insights.
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3. Better analytics. Which enable more accurate prediction of future customer behaviour based on historical behaviour.

The first publicised example is a campaign by Stella Artois.  Every time a targeted individual visits a bar or pub in response to a targeted mobile ad, the drinks company pays a per-visit fee to the location intelligence company, Blis.  The system measures incremental footfall uplift against a baseline set by historical behaviour.  As a result, the linkage between cause and effect is more visible and measurable than ever before.  
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The next step?  Perhaps healthcare organisations might respond with messages targeted at those same individuals, advising regulars not to go to the pub as they have already visited too many times in the last month.
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The value of location data for telecoms network operators

20/3/2017

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It first became possible to access the Internet on a mobile phone in the early 2000s, using the Wireless Applications Protocol (WAP) standard. Ever since then Mobile Network Operators (MNOs) have been seeking ways to add value to their core data service and thus avoid becoming a commodity bit-pipe provider. Early attempts to control the revenue stream involved creation of a portal (or walled garden) that would, in theory, provide all the revenue-generating services a customer might need.  But digital services provision was never a core competence for MNOs – upstarts such as Google and Facebook, were much better placed.  In any case, the open architecture of the Internet was always going to ensure that WAP portals went the same way as dial-up walled gardens like CompuServe (eventually bought by AOL).

But the creation, analysis and application of location data is a core competence for MNOs.  Mobile networks depend critically on location information to provide the coverage and capacity needed to serve customers with data, messaging and voice services.  And as 5G gets closer, faster and more sophisticated location analytics will be required to monitor network performance and assure service levels.  So, there is a clear logic to Telefonica’s acquisition of location data start-up Statiq. Telefonica has the data, Statiq has the analysis capabilities, together a powerful combination. 
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​Moves such as this give MNOs the a very real opportunity to deliver added value and counter the recent trend towards commoditisation.

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Three principles for content marketing

27/2/2017

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Content marketing is nothing new.  It is what marketers have been doing for decades; putting stuff out there to generate awareness of a business, get people interested in the offering and trigger a desired action.  
The difference today (and perhaps the reason we invented a new term for it) is that in the digital world there are millions of times more messages, simultaneously vying for people’s attention.  Every piece of content (or collateral, call it what you will) must work that much harder to cut through.  
There is lots of good advice out there on how to write, so I won’t cover well-trodden ground, but often content misses the target because the foundations are not in place. With that in mind here are my 3 principles for effective B2B content marketing in our current, highly cluttered environment.
  1. Know the audience.  A story that does not tune in to the reader’s wavelength will not engage.   Gain credibility by showing that you know the industry or the discipline.  Show that you know what they know (or heard last) and that you have something to add, or that is new or different.  Perhaps challenging the current received wisdom.
  2. Adopt the mindset of the audience.  This means using their language and talking about their business issues, not your product.  A lot of content defaults back to product features, because the company has not done the research to know what the audience is actually interested in.
  3. Emphasise the reason why.    Talking about what to do or how to do it, without an imperative to act, simply does not motivate.  If there is no reason why there is no point.  Simon Sinek’s simple model of What, How and Why makes the point well.  Here is his Ted talk. 

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5G promises to transform our connected lives

26/1/2017

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Yesterday’s Institution of Engineering and Technology (IET) 5G conference gave us an excellent status update in relation to 5G, the next generation mobile phone technology. Every new generation of technology is known for something and typically becomes described in reference to the previous generation of technology.  The first, analogue, mobile phone networks (later known as 1G) were all about mobility – a phone that you can carry with you. Having met the mobility requirements, 2G networks were all about being digital, which in practice meant text messaging, a network feature that had originally been intended for engineers performing tests, but consumers made into a cool new messaging channel.  When 3G arrived it was all about multimedia, Hutchison 3 launching on the back of videos of premier league football, although for many 3G really meant mobile email.  With the arrival of 4G the mobile phone experience started to get close to the broadband Internet experience we had become used to on a fixed connection - it became about mobile broadband.

So what will 5G be all about? The conference revealed a wide range of views: The Internet of Skills, more capacity, low latency, an enabler of applications and ubiquity were just a few.  The difference with 5G is that is the first cellular telecoms technology to be designed from the ground up to meet a broad range of (currently) identified user needs.  Use cases such as telemedicine, connected cars, media services, public safety and wireless replacement of the fixed network have been defined - to mention just a few.  5G will be the way people access the connected services they need in their daily lives for business or pleasure.  
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All of which means that 5G will be whatever you want it to be.

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What is a value proposition?

8/11/2016

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A quick search for good examples of B2B value propositions leads to the conclusion that the tech industry has forgotten what good looks like.  We seem to be confusing taglines and ads with value propositions. Even Google’s definition: ‘an innovation, service, or feature intended to make a company or product attractive to customers’, misses the point.  Words like innovation, service and feature bias the definition to the supply side.   And attractiveness is different to value.

A value proposition is the basic idea we have in mind when we create collateral, not the content itself. The value proposition must be clear about:
  • Who it is for
  • What it does for them
  • How it is different (to the current approach or the market leader)
  • What that is worth (to a prospective customer)
In his book, Crossing the chasm, Geoffrey Moore (website here) provided a framework that works well for the technology sector: 
For ____________ (target customer)
Who ____________ (statement of the need or opportunity)
Our (product/service name) is ____________ (product category)
That (statement of capability) ____________
Unlike ____________ (the most likely alternative)
Our product (name) ____________ (statement of value)                              

Here is the framework applied to Force.com back in the day when cloud computing was the latest thing:

For IT managers and professional developers who need to build and run business applications and web sites without eating up valuable IT resources our Force.com is a cloud platform that enables customers, partners and developers to quickly build powerful business applications to run every part of the enterprise in the cloud unlike traditional software platforms our product doesn’t need networks, servers, storage, a complicated software stack or the people, space and power to run them and as a result applications can be built five times faster at half the cost.

Clear, succinct and still relevant today.

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Bringing together space and time

11/10/2016

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“Every day sees humanity more victorious in the struggle with space and time”, said Guglielmo Marconi.  It looks like Google may be about to take us another step forward on the journey to integrated location and time information.

Google’s Popular times feature gives searchers a chart showing how busy a place (museum, restaurant, public space) is at different times of the day.   The chart is based on location data from Android mobile phones.  The trouble is, historical averages are only a rough starting point – someone looking for a spot for lunch really wants to know whether that restaurant is busy now.  Add real-time data to the mix and it starts to get interesting.    The website Android Police suggests that Google is testing a live version.  Another step towards the industry’s vision of a world of people and things, all communicating location in real-time (subject to suitable controls) for the individual and greater good.
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The challenge will be collecting sufficient data for meaningful results.  Popular times only works in places where a sufficiently large volume of people go, who all have Android devices and have opted in to sharing their location data. Whilst the spread of smartphones is relentless, ensuring people are trusting enough to share their location is another matter.
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Water - what's the difference?

26/9/2016

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​Ofwat has published its assessment of the costs and benefits of retail competition for household water customers.
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Quantitative benefits are easier to evaluate than qualitative ones, so it’s no surprise that the analysis focuses on cost savings and efficiency gains, with limited analysis of the non-financial benefits.

Experience from the energy and telecom markets tells us that when price becomes the primary driver of competition, the market can be viewed as consisting of two main segments:
  1. Price shoppers who regularly switch for the best deal
  2. Inertia customers who do not switch, despite the opportunity to save (currently up to £300 per year in the case of energy)
Ofwat reflects this in its categorisation of ‘active’ and ‘inactive’ customers.  These segments were  identified by telecoms new entrants in the 1990s who found that offering a similar service to the incumbent, but with a 15% discount, awoke nascent market of price shoppers and brought in a significant customer base.  The downside was that price shoppers would move again as soon as their contract was over, causing the business high costs in customer acquisition and churn.

Ofwat’s analysis shows that in the best scenario, household competition will deliver savings of around £8 per household per year and in the worst scenario it will increase costs by nearly £3 per year per customer.  Even if the market passed all the financial savings through to customers in the form of lower prices, the case for competition based on cost savings alone is marginal.

Which brings us back to the non- financial benefits.  Other markets, telecoms especially, have competed on a number of other fronts: brand values, additional features and value-added services, for example.  Whilst bottled water brands have successfully been able to differentiate, it remains to be seen whether that is possible in water supply.  Incumbents and new entrants are going to require some very innovative marketing if they are to make a success of a competitive household water market.

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Pokémon Go: business or pleasure?

9/9/2016

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​Augmented Reality (AR) is finding valuable applications in business.  Construction firms and estate agents are using AR to visualise planned developments, utilities are investigating the use of AR to visualise the location of underground pipes and cables.  But, as is often the case nowadays, the consumer market is taking the lead.  Pokémon Go has become a global AR phenomenon within months of launch, but is it just a game?  A survey by the SLANT agency (here) has looked at how Pokémon Go players interact with local businesses whilst they play, with some interesting conclusions.  

Businesses can place lures at their location to attract players in and it looks to be working.  Slant found that 58% of players visited a business because there were lures placed there and almost half of those stayed at the business location for 30 minutes or more.  The average spend of players making purchases was found to be $11.30.  In the future we should expect businesses to be just as willing participants in AR games as players, especially as games providers exploit more of the available levers:
  • Targeted, location based advertising, based on data mining.
  • Virtual product placement – positioned to real product outlets
  • TV and media personalities appearing in games, interacting with gamers.
No doubt about it, this is business.

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    Andrew Keevil assists technology companies with strategy and marketing, specialising in new proposition development. 

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