Do you know how you fail?
The manufacturing industry has been evolving out of standard productivity models to higher intelligent systems based on this human experience of "seeing it early", or "knowing the fail".
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.
As per reports, the semiconductor industry is looking at a robust 16% growth, this year. But what is worrying for the industry is the potential supply glut. The capital investment in foundries in 2010-11 has been very high. Foundries like TSMC, Samsung, and Global foundries have almost doubled their previous run rate in the past two years, which capacity will be available to the market from the second half of 2012.
This is certainly going to impact the foundry wafer prices downwards. While the resultant prices fall in semi-conductors should improve demand, given the elasticity of semi-conductor demand the demand rise will not be sufficient to absorb the entire price fall. Also, given the robust consumer demand for electronics, the end product price that the consumer pays is unlike to fall at all.
So essentially, OEMs will be looking at a market in the mid-2012, where the semiconductor and component prices will be cheaper but the final product prices will not be downwardly revised. This will be more beneficial for the contract manufacturers who will be able to source the components cheaper and can improve their margins.
Infosys can support the Hi-Tech OEMs to benefit in this situation and realize more value in such a scenario. Our "Should-be costing" offering, constantly evaluates the ideal to-be cost for components and parts, enabling alert mechanism for customers where the price they are paying is above a certain threshold. We can also enable the processes and platforms for a "Buy-Sell" solution for our clients, managing to realize the price differential that is likely to emerge. In a buy-sell solution, Infosys sourcing and fulfillment teams can support our OEM clients, with sophisticated & precision sourcing directly from the component manufacturers and selling to the contract manufacturers, without having to worry about Inventory obsolescence and carrying costs, fully realizing the differential value.
If you would like to know more on how Infosys can support you, please write to me at Tarini_das@infosys.com