The Mobile Commerce Quest for Value-Added Products & Services

1. The Mobile Commerce Quest for Value-Added Products & Services Pirkko Walden IAMSR/Abo Akademi University pirkko.walden@abo.fi EUNITE 2001, December 2001

2. MOBILE COMMERCE • Key Success Factors • Customer ownership [key for banking, brokerage; others only if value-added for producers & customers; customers kept only through value added and best business practice] • Personalisation • Localisation • Ubiquity • Timeliness • Convenience • Pricing EUNITE 2001, December 2001

3. MOBILE COMMERCE • M-commerce, products & services • Services: intangible, no ownership defined • Products: tangible, ownership defined • Digital products: intangible, ownership defined • Digital services: intangible, no ownership defined • Digital products & services: intangible, ownership is defined • Digital services & products: intangible, ownership is not defined EUNITE 2001, December 2001

4. MOBILE COMMERCE • Conceptual framework, customer perspective • Flexibility, products & services available anywhere, at any time and anyhow • Value-adding, products & services should improve productivity, be adaptive to localisation, be sensitive to customer personalisation • A mobile technology basis, should use innovative and distinguishing features of mobile technology EUNITE 2001, December 2001

5. MOBILE COMMERCE • Conceptual framework, producer perspective • Modularity, products & services to be built from a core of generic modules; should support flexibility • Layers, products & services should be built in layers to add attributes, characteristics; should support value-adding • Bundling, products & services built through a bundling of modular products and service; use the mobile technology basis EUNITE 2001, December 2001

6. MOBILE COMMERCE • Conceptual framework, management perspective • Value/cost ratios, products & services should show good/very good value for cost in benchmarking • Production, logistics, marketing and advertising, value chain activities, products & services should have innovative features through mobile technology when benchmarked • Business model, products & services should use innovative & distinguishing features of business EUNITE 2001, December 2001

7. MOBILE COMMERCE • M-commerce, products & services [Kontinen] • M-commerce: multimodal, mobility • Var A: mobile client, standard services, separate voice • Var B: + services, aware of client location • Var C: + moving services, aware of own location • Var D: + services, aware of other clients in vicinity EUNITE 2001, December 2001

8. MOBILE COMMERCE • M-commerce, products & services [Keen] • M-commerce: freedom of choice the key issue • Follows: knowledge mobilisation among producers, users, management, employees and in peer-to-peer • Proposal: b-to-b is going to be the first breakthrough, wireless support for employees the second • Value networks (?): a better metaphor will be dynamic value entities, which change shape with the context EUNITE 2001, December 2001

9. MOBILE COMMERCE • M-commerce, products & services • Our proposal: probably not single (”killer”) entities • Then follows: synergistic combinations, which can be simplified over time • And thus: key features can be given to individual products & services • Possible variations: (i) b-to-b, (ii) b-to-c, (iii) b-to-employee, (iv) peer-to-peer EUNITE 2001, December 2001

10. LOCAL LOCAL LOCAL LOCAL PERS PERS PERS PERS UBI UBI UBI UBI CON CON CON CON TIME TIME TIME TIME SERV1 PROD1 PROD2 SERV2 PRICE PRICE PRICE PRICE MOBILE COMMERCE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing INTERELATIONS: co-production, technology, content, information, design EUNITE 2001, December 2001

11. LOCAL LOCAL LOCAL LOCAL PERS PERS PERS PERS UBI UBI UBI UBI CON CON CON CON TIME TIME TIME TIME SERV1 PROD1 PROD2 SERV2 PRICE PRICE PRICE PRICE MOBILE COMMERCE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing CUSTOMER PERSPECTIVE: Flexibility, Value-adding, Mobile technology adoptive EUNITE 2001, December 2001

12. LOCAL LOCAL LOCAL LOCAL PERS PERS PERS PERS UBI UBI UBI UBI CON CON CON CON TIME TIME TIME TIME PROD2 SERV2 PROD1 SERV1 PRICE PRICE PRICE PRICE MOBILE COMMERCE Modules Layers Bundle PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing PRODUCER PERSPECTIVE: Modularity, Layers, Bundling EUNITE 2001, December 2001

13. LOCAL LOCAL LOCAL LOCAL PERS PERS PERS PERS UBI UBI UBI UBI CON CON CON CON TIME TIME TIME TIME SERV1 PROD1 PROD2 SERV2 PRICE PRICE PRICE PRICE MOBILE COMMERCE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing MANAGEMENT PERSPECTIVE: Value/cost ratios, Production & logistics (etc.), Business models EUNITE 2001, December 2001

14. MOBILE COMMERCE • M-commerce, killer applications • Killer cocktail: a mix in which components cannot be identified • Killer pizza: a mix in which components can be distinguished • Killer bouquet: the aggregate > the sum of parts • Killer soup: the more ingredients, the better it gets; operator needed for stirring • Killer fondue: as for the soup, no operator needed EUNITE 2001, December 2001

15. LOCAL LOCAL LOCAL LOCAL PERS PERS PERS PERS UBI UBI UBI UBI CON CON CON CON TIME TIME TIME TIME PROD2 PROD1 SERV2 SERV1 PRICE PRICE PRICE PRICE MOBILE COMMERCE Bouquet PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing INTERELATIONS: co-production, technology, content, information, design EUNITE 2001, December 2001

16. MOBILE ICT BUSINESS • Key principles: • Embedding processes in software brings the internal operations and capabilites of the company forward into the customer relationship interface. • In a sense, this concentrates the business into the software; it transforms organisational value chain activities spread across locations and time zones to capabilities at hand, now and anywhere. • It transforms business by enabling personalisation, localisation, ubiquity, timeliness, convenience and neew pricing models EUNITE 2001, December 2001

17. MOBILE ICT BUSINESS • Embedding processes in software is win-win for customer and provider. • Out-tasking – getting rid of a process – is win-win. • In-sourcing – using advanced know how developed by somebody else – is win-win. • Company wins by interacting with a best practice eProcess capability. • Customer wins as service is being handled by a best-practice provider. • The provider wins by + revenue and + market EUNITE 2001, December 2001

18. OUT-TASKING & IN-SOURCING PARTNER I VIRTUAL CORPORATION PARTNER II EUNITE 2001, December 2001

19. MOBILE ICT BUSINESS • Building scale @ speed [Keen]. • Business design and organizational structuring are constrained by geography, physical location, workflows, time and the links with capital investment demands. • eProcess companies can get access to world-class capabilities in months rather than years. A first-rate technology platform and a solid base of repeat customers more and more capabilties at less and less capital cost. EUNITE 2001, December 2001

20. MOBILE ICT BUSINESS • eProcess strategies [Keen]. • eProcess edge over traditional companies: information-rich relationships with customers and organizational flexibility through in-sourcing; out-tasking simplifies operations and improves service. • Build in-house capabilities: these form the operational basis for the company: • Enable people with knowledge and access to work effectively • Support knowledge work with high-touch and –texture interfaces • Embed company rules into software interfaces • Build internal systems that provide high-value functionality • eProcess techniques to decide where and how to focus in-house capabilities EUNITE 2001, December 2001

21. SERV1 SERV2 SERV3 SERV2 PROD1 PROD2 MC BUSINESS MODEL A Bouquet of Bundles B-TO-C EUNITE 2001, December 2001

22. MC BUSINESS MODEL • B-to-C • Bundles are combinations of products & services • A bouquet can be built from (i) bundles or (ii) from combinations of individual products & services. • A bouquet is built to offer • Flexibility – availability anywhere, at any time and anyhow • Value-added – will improve productivity, will be adaptive to localisation, will be sensitive to customer personalisation • Mobile technology adoption- will use innovative and distinguishing features of mobile technology to enhance flexibility and value-added EUNITE 2001, December 2001

23. MC BUSINESS MODEL • B-to-B • The same bouquets or bundles are used as in the B-to-C model • The customer is a business. • A bouquet is built to offer • Flexibility – availability anywhere, at any time and anyhow • Value-added – in production, logistics, marketing & advertising: value chain activities for bringing m-commerce products & services to the markets • Mobile technology adoption- will induce (i) business process reengineering, (ii) multimodality, (iii) out-tasking, (iv) in-sourcing, (v) new logistical solutions EUNITE 2001, December 2001

24. MC BUSINESS MODEL • B-to-B [cont.] • Bouquets are • adapted to customers and made ubiquitous with layers, • adapted to localisation, personalisation and timeliness through modules • built for customer convenience with variations of the mobile technology and the use of a choice of platforms (smart phones, WAP, communicators, PDA, digiTV, WLAN etc.) • Structured and built for flexibility and value-added • The bouquet structure of m-commerce products & services supports the out-tasking and in-sourcing business models [cf. next slide] EUNITE 2001, December 2001

25. SERV1 SERV2 SERV3 SERV2 PROD1 PROD2 OUT-TASKING Partner I OUT-TASKING Partner I IN-SOURCING Partner II MC BUSINESS MODEL A Bouquet of Bundles B-TO-B EUNITE 2001, December 2001

26. MC BUSINESS MODEL • B-to-B [cont.] • Partners I and II work on • Product entities and • Service entities in a bouquet • Modules forming products & services • Layers, which are included in products & services • Bundling products & services • Logistics • Marketing and advertising • Management, and maybe even • Planning EUNITE 2001, December 2001

27. MC BUSINESS MODEL • B-to-B [cont.] • The mobile commerce business model may have side effects on consortium and business partners in traditional business • The mobile technology used/enhanced/improved/developed to serve mc business models may traditional solutions in • Production • Logistics • Marketing and advertising • Management, and maybe even • Planning • Thus, m-commerce may introduce competitive advantages also in tradional industry EUNITE 2001, December 2001

28. MC BUSINESS MODEL • B-to-Employee • Both B-to-C and B-to-B solutions may be adapted to B-to-E • Involves (i) an adaptation of modules to fit the corporate intranet and corporate standard mobile solutions, (ii) the choice and adaptation of layers to fit employee work context and tasks, and (iii) the building of company-specific bundles or bouquets • These B-to-E solutions can be offered by (i) the producer of m-commerce products & services to its own employees, (ii) the out-tasking and/or in-sourcing partners to their own employees, (iii) other business partners in traditional business, (iv) through licensing to any corporate customers or by (v) licensing partners to any corporation EUNITE 2001, December 2001

29. MC BUSINESS MODEL • B-to-Employee [cont.] • The B-to-E solutions may have some interesting consequences • Employees (E) will/can work with and understand the m-commerce products and services • E gain the same value-added in their own work as B or C partners • Knowledge mobilisation among E • Out-tasking and in-sourcing may become possible between and within teams working in the same organisation • Freedom of choice to work wireless anywhere, anytime and anyhow while moving • Corporate structure will be simplified, virtual, adaptive, flexible, fast in reaction and knowledge based EUNITE 2001, December 2001

30. MC BUSINESS MODEL • Peer-to-Peer • Principle: B-to-C products & servicces move out of the control of B to become P-to-P distributed (and loved by the network operators, which will gain in cash flow) • B can control Bouquets or Bundles, and (i) allow or (ii) not allow P-to-P distribution; this can be controlled through proprietary software or possibly encryption • B may be interested in allowing P-to-P distribution in order to create a market; could include some mechanism to collect a (small) fee per user/customer/usage time unit/volume, etc. • If in-sourcing & out-tasking is used there may be restrictions on the use of modules, layers and bundles EUNITE 2001, December 2001

31. MC BUSINESS MODEL • Peer-to-Peer [cont.] • Products & services may be modified for P-to-P usage by • Deleting or modifying modules • Controlling the use of layers • Adapting or tailoring bundles • P-to-P can be used to create Clubs, User Groups, Virtual Tribes – groups sharing in modification and application solutions EUNITE 2001, December 2001

32. MOBILE COMMERCE • M-commerce vs. e-commerce • Overall: focus on the following issues as compared to e-commerce • Changes in fundamentals • Significant changes in technology • Modifications of products & services • Mobile enhancements of e-commerce products & services • Business models • Pricing EUNITE 2001, December 2001