The Future of the Mobile Economy: 3 Big Trends from Davos
Every winter, world leaders, CEOs, and all manner of prominent international figures (from Oprah Winfrey to Tim Berners-Lee) descend on Davos, Switzerland, to attend the annual meeting of the World Economic Forum (WEF). And while technology and its political, economic, and social impact has long been on the agenda at Davos, the so-called Fourth Industrial Revolution heralded by the rise of mobile and related emerging technologies dominated this year’s meeting, which ran January 20–23.
While the luminaries at Davos can’t predict the future, the discussions there have a major influence on global priorities for a whole host of nations and brands. Here are three trends highlighted at Davos that marketers should make sure to keep an eye on:
1. The democratization (and continued spread) of mobile
It can sometimes seem like mobile has no more worlds to conquer. Smartphones and tablets are so popular in developed nations that it can feel shocking to come across someone who doesn’t own a mobile device. But while mobile has also made significant inroads in developing economies, there’s still a long way to go: only 51% of the world’s population currently uses mobile devices.
That percentage will likely rise as mobile devices become cheaper and data networks in emerging economies grow increasingly robust. African nations are expected to see particularly strong growth in the coming years, with Ericsson CEO Hans Vestberg predicting during a Davos panel that the number of mobile phones used in Africa will increase from 70 million today to more than 700 million by 2021. And because many of those new devices will be purchased by people who don’t have landline phones or desktop computers, mobile will be the the first and only digital way for brands to reach them.
While mobile has been a global phenomenon from its early days, the massive growth in smartphone users in developing regions will create a new base of potential customers for mobile-savvy brands. But as marketers work to reach, engage, and eventually monetize this new audience, they’d be wise to pay attention to some of the lessons on display in countries where mobile is already ubiquitous. Publicis Group CRO Laura Desmond notes growing consumer worries about digital security, privacy, and inequality and argues that people are increasingly looking to have “their user rights and data protected and are demanding transparency and control. If brands don’t give them that, they risk losing their trust.”
To succeed in this new mobile future, marketers need to make full use of the engagement and retention tools at their disposal to create a brand experience that fits each customer. That means sending individually personalized messages in the right language at times that customers are most likely to engage and iterating regularly to make sure that your brand is building a durable, long-term relationship with its customers.
2. The rise of the platform economy
Technology platforms were a major topic at this year’s Davos, with a session dedicated to examining the impact of the platform economy.
What are platforms? In essence, platforms are technologies that support today’s digital world and allow third-party brands to use them. They include the iOS and Android mobile operating systems that allow people to access and use an endless number of apps and mobile web sites, as well as cloud computing services like Amazon Cloud Services and Microsoft Azure that power so much of our modern digital infrastructure.
Companies involved in the platform economy have a total market value of over $4.3 trillion and while their rise has been instrumental in supporting mobile’s massive growth, the ongoing platformization of technology has led to a major consolidation in power and wealth among a comparatively small number of companies. That’s raised concerns that the companies that control these platforms will have a natural advantage as technology progresses, potentially limiting other brands’ ability to compete with them directly.
Brands without a major technology platform of their own need to start thinking about how to engage with this shifting terrain. Today’s marketers have a couple of options when it comes to leveraging platforms to engage their customers:
Layer your brand’s presence on top of an a device’s primary platform like iOS or Android
A lot of brands are already doing exactly that by investing in iOS and Android mobile apps to take advantage of the mobile app stores and platforms offered by Apple and Google. However, the way that most people engage with mobile apps can make this approach difficult to pull off successfully—80% of users’ time is spent on their top three apps. To make this investment in a mobile app worthwhile, brands need to use push notifications, in-app messages, and other messaging channels to keep their customers consistently engaged; otherwise, they risk significant audience attrition on these platforms that can undermine their entire marketing strategy.
Take advantage of secondary platforms like Facebook and Uber to reach customers
Some brands with especially popular iOS and Android apps have taken advantage of their significant audiences on mobile to create a second-level platform that sits on top of the mobile platforms controlled by Apple and Google.
Consider Facebook. While Facebook is only reachable on mobile if you have a device that makes use of a mobile platform like iOS or Android, the Facebook app has essentially become a secondary platform built on top of those mobile operating systems. Facebook allows other brands controlled access to that platform (and to the platform built around its Facebook Messenger app) and with its audience of users. That gives the company significant power over how the platform is used by third-parties that’s similar to the control Apple and Google have over the App Store and Google Play, respectively.
While Facebook’s major popularity on mobile makes its secondary platform especially valuable, it’s far from the only brand to take this approach. Uber, Slack, and Box are among the companies using similar tactics. Partnering with a secondary platform can give your brand the opportunity to piggyback on their established user base to grow your audience and reach the customers you already have in new ways. But it can also mean paying fees or accepting restrictions set by the brand that controls the platform. Do your homework before getting involved with a second-level platform to make sure that the value proposition makes sense for your brand.
3. Emerging technologies building on top of today’s mobile landscape
Much of the discussion at this year’s WEF meeting centered around emerging tech and its potential to fundamentally reshape the world economy and consumers’ lives. Solar-powered drones. Virtual reality. Implantable devices. Autonomous vehicles. The rise of artificial intelligence. All these technologies—and more!—are coming into view, some faster than others, and the future they suggest is one that’s more connected, data-driven, and complex than the world we’re currently living in. The question isn’t whether they’ll have an impact on how brands reach and engage customers; the question is what that impact will look like.
It’s important to be aware of the latest technologies, their potential and risks, in order to plan effectively for a shifting business landscape. But that’s not enough.
While now is not the time, for instance, to start building out virtual reality marketing campaigns—the technology is too new and available to too few consumers to make the effort worthwhile—it is exactly the right time to make sure that your brand has a rock-solid mobile strategy. Most of these new technologies will interface in some way with mobile and brands that are still struggling to establish a mobile identity and approach when virtual reality and other potentially game-changing technologies come to fruition are going to end up falling even further behind.
Don’t let it happen to you.