Discuss, debate and exchange ideas on latest trends and opportunities in the Business Process Outsourcing (BPO) landscape. Deliberate on adding “business value” to clients, vendors, employees and various other stakeholders to enhance customer satisfaction and sustain long term partnerships.

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December 30, 2011

Ruminations on Search Advertising for 2012: It lies in our hands

A recent research by Zenith Optomedia predicts internet's share of expenditure in the overall Ad Spend market to rise from 15.9% in 2011 to 21.2% in 2014. Between 2011 and 2014 internet advertising is predicted to account for 52.9% of the growth in total expenditure being the single biggest contributor of new ad dollars to the global market. As the largest segment, paid search will contribute 25.6%, followed by display at 22.6%, with classified at a much lower 4.7%. Display is the fastest-growing segment in internet ad-spend, growing by 18.9% a year. The  study finds that this trend is primarily driven by increased acceptance and penetration of online video, social  media and the emergence of do-it-yourself tools.

While internet advertisement space is becoming mature and consolidating, the other channel of on-line advertisement that is becoming increasingly more crucial and requires a well thought out planning is mobile advertisements. This space has its own challenges and one-size fits all strategy does not work well for mobile advertisements both for ad buyers and sellers not only the likes of Microsoft, Yahoo, Google but also for myriad of app based advertisers/channels. In this post I will focus more on the buyer perspective.

Most of the industries like Travel and leisure, retailers, consumer electronics have established their digital marketing channels across traditional and social medias. But with burgeoning acceptance of mobile and touch driven platforms, they are gearing up for the next mobile driven frontier for consumer connect. Google already predicts anywhere between 12 to 20% of the searches to originate from handheld devices. And there is huge opportunity for the buyers as the competition is less fierce for keywords compared to desktop search which reduces the cost per click and cost per acquisition. With technologies like Geotargeting and click-to-call the effectiveness and efficiency of digital campaigns can improve. This is particularly effective with the research online purchase offline(ROPO) group.

While it is going to be an exiciting new area, buying mobile search without a thought-out strategy can cost brands dearly in click costs and lost opportunities. The usual practice as observed is that mobile as a channel gets gobbled by the overall online search strategy, which invariably results in lower ROI for the campaigns. Besides usage behavior differs significantly. Some of the specific mobile usage patterns that have been noted are low attention spans, multiple input options for search terms, spelling mistakes leading to shorter search terms and presentation of rich content etc. Yahoo research also indicates that mobile search users are, demographically, different from their desktop counterparts - more than a quarter being under 25, versus 15% of desktop and 11% of iPad searchers.

Given mobile search costs are much lower than desktop search, managing it as an independent channel can deliver real direct and idirect cost savings while improving revenue. The usage behavior, time of search, demographics and sensitivities in a mobile search are other parameters that buyers should evaluate to ensure higher ROI while fine tuning the mobile search campaign.

December 27, 2011

Using Your Peripheral Vision

Recently I was driving my car on a long distance trip and I noticed how I was using my peripheral vision more than I usually do during my daily routine. I was constantly scanning not just the road ahead of me but also everything on both sides of the road, and making some calculated changes to my driving style to be prepared for anything. This is mandatory in Indian driving conditions because there are some well-known "hazards" that will keep popping up in front of you. These could be stray dogs, domestic cattle, local cyclists, school children, or the most dangerous one "The daring teenager on bike".
 
Coming back to peripheral vision, the idea is to maintain the focus on the road but at the same time train your mind to "look out", so that it becomes a habit that flows naturally. And then it struck me, mature BPO buyers are no longer focusing only on their "Tunnel Vision" which is labor arbitrage. Like the car trip, the prime objective still remains going from point A to point B -- which is reducing the cost of operations -- but they are also asking the service providers to use their "peripheral vision"  to lookout and avoid potential hazards for the business, and to be flexible enough to change the driving style, if required.
 
And just like in driving a car, for it to be effective, the use of peripheral vision has to become a habit. A service provider should continuously look for Continuous Improvements Opportunities, advise the partner firm on potential areas of growth, and create such confidence with the customer that he is even willing to let you drive his Porsche on busy Indian roads.

December 23, 2011

Opportunities to improve Procurement Capabilities, Maturity and Performance

While it is obvious that any progressive organization would like to improve their sourcing & procurement (S&P) performance to best in class (BIC) or world class (WC) levels, not many would know the art and science of planning and/or executing it. On top of this situation, there are day to day pressures of meeting supply requirements, supporting other internal mandates and coping up with shortage of procurement skills/people. Whether any organization is in growth or maintenance phase of its lifecycle, this need or desire to meet such challenges remain constant. So what's the way out?

One way out could possibly be to seek external help from a strong partner in procurement who knows not only to measure the as-is situation, but who is also able to present a medium to long term roadmap to achieve breakthrough procurement performance. One important aspect here is alignment of various procurement infrastructure elements (e.g. people, process, technology, knowledge etc.) with other operations/business strategy elements, considering their individual availabilities, capabilities and maturity levels. Alignment and capabilities of procurement elements decide the level of ultimate procurement performance.

Infosys solved such problems for a leading hospital in early 2011 - a 1300+ bedded hospital in Belgium. Infosys S&P experts conducted detailed surveys on-site, administered questionnaires to arrive at statistically significant as-is situation indicators. The road-map to the to-be state was then planned for a 5 year horizon balancing the business needs, investment and ROI goals of clients. For each of the capability improvement phases, incremental benefit streams, organization structures and change management plans etc. were detailed in an actionable, plan vs. actual type tracker. In addition, various sourcing strategies tailored to hospital specific commodities and environments were detailed (e.g. managing physician specified commodities).

The business case forecasted procurement performance elevation to BIC and WC levels in 5 years on parameters like Quality, Cost of procurement operations, Delivery, Savings, Spend under management etc. In addition, the stakeholder value likely to be added was also forecasted. The report was approved by C level executives and implementation is currently on.

So, a great opportunity exists for all firms to invest in something as significant and highly value adding.  Such a project can be real quick also, ranging from 1 month to 3 to 4 months to get the business case with roadmap for approval. Would be eager to know views from you and continue the discussion.

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