Upcoming Trends for 2012

2011 proved to be an exciting year, and we anticipate 2012 to be even better. Take a peek at the trends we’ll be watching in 2012. Happy Holidays!

Mobile Payments Accelerate

Wallet? What wallet? I have my phone.

There is no doubt the penetration of smartphones has changed the way we communicate, inform and entertain each other. Mobile devices have also changed the way we shop—helping us locate, evaluate and recommend every kind of product or services imaginable, but we still have to pull out the plastic (yeah, some still carry cash) to transact… Well, that final frontier of the commerce experience is also changing, and fast.

The first step has been the easy one. With the proliferation of mobile browsers, e-commerce purveyors have been releasing mobile-friendly sites to attract customers on the go and help them make the final purchase on their devices. Some firms—like BestBuy—have mobile versions of their sites, while others—such as eBay and Amazon—offer mobile web apps and fully native mobile applications. During the next year, you can expect to see every company that is serious about their e-commerce presence, launch or improve their mobile offering.

The next step, which offers the biggest benefit to most consumers, is mobile payment at retail. Whether shopping at a large retailer, a boutique, the farmers’ market or dining at your favorite restaurant, the POS terminal is becoming your phone. While mobile payments at retail have experienced slower adoption in the US, we expect to see dramatic growth in the coming year. In fact, it has already begun.

• The major players in the both the tech and banking industries have been fast at work to create systems that allow consumers to use their phones for payments. PayPal and Google (in conjunction with CitiCards and MasterCard) are offering services today; and we can expect American Express, VISA and others to release new mobile payment offerings soon.
• Less than a year after Starbucks launched an app that allows customer to pay with their phone, the company had hosted 26 million mobile transactions on iOS, BlackBerry and Android.
• During the recent Black Friday annual shopping bonanza, PayPal announced a 516% increase in mobile payments.
• GSI Commerce, a company that manages the online sales and fulfillment for many retailers, announced an increase of 254%.
• Gartner forecasted a global increase in mobile payment volume of 76% to $86 billion with much of the growth coming from North America.
• Each of the top smartphone developers (sans the one most are waiting on) have smartphones that include Near Field Communications (NFC, a wireless technology that provides data transfer between devices in close proximity such as less that 10 centimeters).

Contextual Services Find Their Way

Behavioral tracking, targeted marketing and more… oh joy!

With the proliferation of mobile Internet-enabled devices, we’ve become accustomed to instant access to information no matter where we are. The problem is that we often have to proactively search for this information.

Enter Contextual Services—the ability for your mobile device to be “aware” of the context around you and behave differently as your environment changes. In the next year, we believe it will become commonplace for your device to proactively change settings and notify you of relevant information based on your location and needs. For example,

• If you’re near an electronics store, you’ll automatically get coupons for the HDTV you were researching last night.
• You’ll be able to transfer information between your computer screen to your tablet, simply by placing the devices in proximity to each other and gesturing.
• As you walk into the cleverly named conference room, your phone will automatically silence itself and pull up the online meeting information from your calendar.

The mobile device is one of the few electronics that is typically a single-owner object. Therefore, as your mobile device becomes more integrated in your daily routine, the more personally relevant contextual results you’ll receive. We expect to see personally relevant contextual services emerge in a convergence between mobile advertising, advanced artificial intelligence (such as Apple’s Siri), gaming, shopping, directory assistance and opportunity discovery.

Contextual services are already blazing trails in the marketplace. Gartner estimates contextual awareness will be a “$12 billion market by 2012“. Startups like Urban Airship and hipui are building advanced tools to help your business take advantage of contextual awareness. Apple already uses contextual awareness in their stores to help associates spot customers in need of assistance. Nokia is experimenting with highly personalized contextual awareness via Nokia Situations.

Mobile Website As Apps

The lines between mobile websites and apps are blurring.

Mobile apps are now a high priority for our clients, which is no surprise given that Morgan Stanley expects mobile Internet usage to surpass desktop Internet usage by 2014. Deploying a best in class mobile solution used to mean writing separate native applications for iOS, Android, BlackBerry, Windows Phone 7 and others. But in the past year, that’s all changed.

Recent advances in JavaScript libraries—such as jQuery Mobile and Sencha Touch—combined with near-universal support for HTML5 and CSS3 make cross-platform, best-in-class web applications a viable option over traditional native applications. We are counseling our clients to keep a keen eye on web apps because they provide several key advantages:

• Web apps are often significantly less costly to develop and maintain
• Users can place a web app icon on the home screen, and the app will behave similarly to a native app
• Unlike native apps, separate web apps do not need to be developed for individual platforms
• There are no app store or marketplace restrictions on content or functionality
• The burden to install and manually upgrade the app no longer falls on the user

The Financial Times made a bold move this past year and eschewed the native app in favor of a sophisticated web application to deliver their daily news content. Their primary motivation was to avoid Apple’s 30% in-app subscription tax, but they also reaped the benefits of lower maintenance costs and instant feature releases. Amazon brought their popular Kindle reading platform to Safari for the iPad with Kindle Cloud Reader, with promises to support more mobile browsers shortly. Google has also put a strong emphasis on mobile web apps for all of their major products, with best in class offerings for Search, Google+, Picassa, Gmail, Google Docs and YouTube.

Certainly, there are still cases where a native app might make more sense than a web app, particularly in areas where rich business logic, advanced graphics or visualization is required. But for most information consumption scenarios, we predict that web apps will become the de facto choice for deployment.

From all of us at ThoughtMatrix, we wish you a very Happy Holiday and anticipate connecting with you again in the New Year.