Tuesday, November 23, 2010

Bricks, Mortar and Mobile: A New Paradigm This Holiday Season

It seems that online shopping and the in-store experience are coming together this holiday season, courtesy of the growth of the smartphone market.

Online holiday purchases have steadily increased each year for the past several Christmas seasons.  This year, it is a little different because many consumers now carry the internet with them in the form of a smartphone.  This means that they don't need to check prices online and then run to the store, or vice versa.  They can stand in front of a product in the mall and immediately check the pricing against online options.  A recent survey by IDC indicates that over 1/3 of smartphone owners intend to use that strategy this year.

Recognizing the trends, retailers aren't sitting on their hands.  Many retailers have developed custom smartphone apps to stay in front of connected consumers.  This not only gives them a seat at the comparative shopping table, but it also allows them to keep selling after they lock the doors at night.  Many consumers are shopping at all hours of the day or night, increasingly using their smartphone.  If they are looking at an app from Target or another retailer, there is still a possibility that they will go make the purchase at that store, or buy from the store's website.  And target is also making its website available through shopping kiosks placed throughout the store.

Amazon is working hard to lead the pack in the integration of in-store and mobile online shopping.  Consumers can scan an item's bar code in the store, take a picture of it or even say the name of the product into their phones, and Amazon's app will scan the Amazon inventory for pricing and availability.  If it looks good, consumers can buy it from Amazon on the spot.  (Of course, read further down in that article, and it points out that RedLaser already offers smartphone technology which will scan bar codes and compare prices on many different websites, not just Amazon.)

For a good discussion of the whole phenomenon, check out this article in the San Jose Mercury News.

So what does all of this have to do with the entertainment business?  As tablets will be one of the hot sellers this holiday season, and smartphone sales continue to grow, this trend towards mobile media and commerce will expand greatly.  There will be a huge demand for mobile content, as well as genuine opportunities for mobile brand integration strategies.  And the growth of mobile commerce means that many more advertisers willing to sponsor mobile content.

2011 will be the year that mobile devices break out as a separate category of entertainment, and a medium where creators will soon be able to make some serious money.  If you're developing content, think online and mobile first.  You can get it "on the air" quickly and build an audience while you chase a television deal.  Or just keep it in the digital realm and take advantage of the large move towards mobile commerce.

Saturday, November 6, 2010

One Is All You Need

It seems every day there is another news story describing shock at the decreasing number of cable subscribers.  Like yesterday’s story with the headline, “Cable Subscribers Fleeing, But No One Knows Where.”  What??  With all due respect to the Associated Press, this is about as hard to figure out as a bad murder mystery.  The butler did it, now move on.  

Here is the truth.  We have reached the point where we don’t need multiple wires to carry data in and out of our homes.  Our phone line, cable television and high speed Internet are all doing the same job.  They are three different wires carrying packets of digital data to and from the same place.  We are simply waking up to the fact that there is no longer a need to pay for all three.  

It is like carrying three different smartphones for email, texting and phone calls.  It would be redundant and unnecessary.  If someone did that, we would think they were being wasteful, and even rather stupid.  In a very short time, we’ll feel the same way about anyone who pays for cable television and a phone line and Internet access. 

A connection to the data grid doesn’t know whether it is carrying audio, video, pictures, text or something else.  And it doesn’t care if it’s uploading or downloading.  It is all just packets of digital information going back and forth.  And the speed and capacity of a typical connection is now large enough that it can carry as many packets as you can send, as fast as you can send them.  You can have a house full of people communicating through email, texts and phone calls while watching 4 different programs on 4 different televisions, and one wire can carry it all.

None of this is shocking to anyone who is looking forward instead of backward.  I could write a very long history book about the technical, legal and economic reasons that we all have three different wires carrying data in and out of our homes.  But it doesn’t matter.  Those reasons are no longer relevant.  History is not news.  

News stories about the decreasing numbers of cable subscribers are like news stories about the decreasing number of CD sales.  You might as well be writing about the decreasing number of horses on the roads since the invention of the automobile.  It’s all the same story – things change.  That’s happening every day.  The real news is not about where we were, but about where we’re going.
So why are people giving up their cable subscriptions?  Simple answer: because it costs over $100 a month and they don’t need it.  A lot of people are giving up their land line telephone too.  They don’t need that either – they can use Skype or their cell phone, or Skype on their cell phone.  You only need one wire, and in fact, some day you might not even need that.  Before you know it, we will probably all be connected to the cloud 24-7 through a 4G connection (which will probably be a 7G or 8G connection by then). 

There, mystery solved.  Let's not spend any more time pondering the obvious.  Instead, let's think about the opportunities that are available in a world where everyone is connected to everything all the time.