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December 31, 2014

Financial Services Serve Up Social Media

Posted by Rajashekara V. Maiya (View Profile | View All Posts) at 4:09 AM

Digital connections can help financial services companies connect with customers in a more meaningful way

An important metric for any industry is to measure conversation length over social media. Some sectors, like the retail industry, know how to foster consumer loyalty and get them talking about it over social media channels. I bring this point up because some industries have a long way to go when it comes to leveraging this valuable medium.

Among them is the financial services sector. Recent analysis found that the average length of time spent discussing banks online is just 30 percent of the time consumers discuss telecommunications. And it's just 15 percent of the time that those same people spend chatting about media and entertainment companies.

Don't get me wrong: People consider their relationships with their banks to be very important. They're entrusting these venerable institutions with their savings. My point, however, is the digital connections that these banks are making and sustaining with their consumers. If and when they can effectively use Information Technology to learn what their consumers are thinking (and talking about), such companies will be able to develop more relevant financial products and connect with them in a more meaningful and lasting way.

A similar study that measured online advocacy discovered that the typical bank has an audience that is just 9 percent of advocates - die-hard fans, really - in social media circles discussing the typical telecommunications firm. And just 2 percent of the crowd advocating a media and entertainment company. One of the ways financial services firms are connecting with their consumer base is through co-creation and gamification over social media. Such digital tools target an audience and help the organization understand vital relationships better.

Banks are beginning to do an admirable job of grasping the social context of their consumers ... and even employees. These trends are still emerging and there's a lot we have yet to discover about their advantages as to how they're changing the ways we all do business.

What the financial world does know is that when it can become more familiar with its colleagues and consumers by interacting with them in a fun yet instructional atmosphere, everyone wins. And it's often so seamless of an experience that nobody realizes it's happening. This is all part of a broader, multi-channel engagement model. Each customer will choose the way she wants to interact with a brand. It's up to the brand to figure out the best way to do this. Co-creation and other methods are innovative approaches that have lots of potential in banking and financial services.

There are huge opportunities for financial services firms in the year ahead of us. The year 2015 will be filled with digital surprises! Co-creation can be extended with gamification to make a broader, more engaging customer experience. Although customers may not yet be burning up Facebook or Twitter while discussing their favorite banks, there is already a high level of trust between a bank and its clients. That is the kind of trust that can be extended across all sorts of interesting digital channels and networks.

December 25, 2014

Here's Why Tech Form Follows Function

Posted by Suryaprakash K. (View Profile | View All Posts) at 10:35 PM

The wearable in any form will eventually cost less to make and be smaller, lighter, and more convenient than smartphones and tablets

The average mobile user checks her device 150 times a day. So says one of the foremost authorities on technology in the world, Mary Meeker.

Meeker was one of the first Internet analysts in the 1990s. She left Morgan Stanley to become a venture capitalist at Kleiner Perkins and her annual Internet Trends presentation is the industry gold standard and a highly anticipated event. Her latest prediction is that wearable computing platforms are going to continue to boom in popularity. Consider a metric like consumer listening hours: On Pandora as measured in three categories (PC versus mobile & tablet versus wearables like car/TV/appliance), wearables are expected to account for more than a quarter of total share.

What about your already-busy mobile device? Its various functions suggest that it's going to evolve in form to better meet consumer expectations. Of the 150 times a typical user checks her device, messaging accounts for 23 times, voicemail 22, time 18, music 13, gaming 12, social media nine, camera eight, alarm eight, news six, and calendar five. That's why wearables will continue to skyrocket in popularity, according to Meeker. What's the point of digging into your pocket when you can blink your eyes or flick your wrist in order to message, hear voicemails, and perform other activities that take up so much of your time today?

No doubt about it--the market is moving towards wearable computers. People like you and me are always in search of higher functionality and lower cost. That's the magic of the market. It's what drives Moore's Law and our all-around desire for computers. The wearable in any of the forms we know now - visor, car dashboard, wristwatch, and eye glasses - will eventually cost less to make and be smaller, lighter, and more convenient than smartphones and tablets.

Meeker predicts that total usage of wearables will follow a 40-year trend line: That is, where there were 1 billion computer users/units a decade ago, we should expect 10 billion by 2020, just five years away. What none of us is too sure about is exactly how the wearable story will pan out. Note how people currently refer to wearable computers: Car? TV? Appliance? If any of us did know for sure and how, I suppose Wall Street would herald us as the next Warren Buffett.

We do know that even though wearable devices will always be on, they will consume relatively little power to do so. They'll sense what we're going to do before we do it, based on records of our past movements but also by sensing real-time nerves and muscle movements. They'll utilize the array of tools we now know in different ways. An extremely sensitive microphone, for example, might measure a user's blood pressure by detecting the sound of the heartbeat and other physiological sounds. The device could then send the information to the user's healthcare provider. Car crash fatalities caused by texting while driving continues to grow as a cause of death for millennial consumers, so the marketplace will no doubt welcome any functional improvement in that area. Alerts, messages, and reminders won't require any digging for a tablet, coaxing it out of sleep mode, and scrolling for what you need to do.

As part a past presentation, Meeker reminded the audience of a May 1999 cover story in Barron's. The article was about Jeff Bezos and was titled "Amazon.bomb." It's sobering to recall how some investors wrote off the innovators of the early web. The temptation is to dismiss Meeker's bold predictions for wearables and many other of today's tech prognoses as well.

Frankly, I think the uncertainty that surrounds the future of wearable technology is part of its appeal. In a few years, the young technologists who today are competing in hackathons will be the ones who have come up with radically innovative ways to deliver on what the market wants. Just as today's masters of the technology universe seem to have come out of nowhere, so could the next wave of disruptive innovators. They'll be leveraging wearables in ways that we can't even imagine yet.

December 23, 2014

How Digital Visualization Tools Will Move Markets

Posted by Rajashekara V. Maiya (View Profile | View All Posts) at 8:33 AM

StockCity: A virtual look at your stock portfolio | CNBC [Source: https://www.youtube.com/watch?v=BRKtDd23JUE]

When you think of high-tech, innovative research and development facilities, industries like defense and aerospace, pharmaceuticals, and telecommunications probably come to mind. But mutual funds? Yes, there is such a thing as a mutual fund R&D laboratory.

In fact, one such lab is associated with Fidelity Investments, the largest mutual fund firm on the planet. What amazes me about pushing the envelope in the mutual fund industry is that at first glance there doesn't seem to be an envelope to push. An investor allocates a certain amount of money toward buying into a fund, and each month she gets her statement. OK, so maybe the statements come online instead of in the mail. But is there any serious need to tweak this age-old system? It works well enough.

According to an innovative company like Fidelity, the answer is yes, there is a need to update things. Its Fidelity Labs is taking a cue from other consumer-focused industries and developing really neat technology to get the average person more engaged with the art (or is it a science?) of mutual fund investing. StockCity, Fidelity's take on the popular SimCity game, is becoming a hit with select consumers in its trial stage. For a good portion of the population, the capital markets can be a confusing, complex place. What StockCity does is to help consumers visualize their investments as if their portfolios were cities.

Gamification, the concept which powers StockCity, is making its presence felt in the financial services industry. Financial services companies are using gamification to help customers understand financial products in a language that they understand better. Specifically the younger generation. Our recent survey with EFMA reported that banks such as BBVA have invested in pureplay gamification technology companies in the Silicon Valley to enhance customer experience.

One of the great promises of digitally powered platforms and marketing is visualization. The 'dashboard' is perhaps the best known and most used of digital tools that utilize the power of sight. But augmented reality is taking visualization another step forward. With the Fidelity financial planning tool, which is now in a two-dimensional format during the test phase, the goal is to release it with three-dimensional capabilities as well. In fact, it will operate on an Oculus Rift augmented reality helmet.

The private investor would put on the helmet (or look at his computer screen) and see a city skyline. Each neighborhood stands for a sector (retail, pharma, oil, aerospace, consumer durables, etc.) and each building within each neighborhood represents a specific stock. The height of every building rises and falls with its stock price. If an investor has a portfolio that includes, say, a Fidelity mutual fund that focuses on pharmaceutical companies, the buildings in the neighborhood would generally be one color (for pharma) and the individual skyscrapers would move up and down depending on the market prices of those pharma stocks. Another neat feature is that the investor gets to visualize the health of the greater economy by how sunny or cloudy is the weather over the StockCity. A clear day suggests a bull market; a cloudy or rainy day suggests a bear market.

Speaking of bull markets, investors and analysts alike wondered why a hot social media stock like Facebook would pay a whopping $2 billion for Oculus Rift, the virtual reality company that Fidelity hopes to partner with for StockCity. When you consider how digital visualization tools work for the consumer, it's no wonder why social media sees great potential in these sophisticated augmented reality headsets. They're going to be used for more than just really cool video games. Soon, investors will be moving the capital markets according to trades they make from their digital investing helmets and platforms.

Let me leave you with this thought, though. Fidelity is the largest mutual fund organization and its foray into gamification for customer engagement is no doubt interesting. But, think about this - the third largest mutual fund organization is Alipay - a mobile-only mutual fund company that is part of the Alibaba group of China. Alibaba recently went public with the largest IPO in corporate history. Alipay manages its entire mutual fund operations on mobile. Neither Alipay nor Alibaba is a financial institution. This means that the competition for banks is indeed heating up with new players finding new ways of doing business. What the future holds is anyone's guess!

December 19, 2014

Hackathons and the Road to Success

Posted by Sanjay Purohit (View Profile | View All Posts) at 6:44 PM

Participants at EdgeVerve Hackathon 2014

"If only I could bottle that..." These are famous first words. And the rest of the sentences are usually just as well known: "... I'd be millionaire" or "...I'd be famous."

The problem was that until very recently it was difficult to bottle something as intangible as ingenuity. In the old days, an executive would hope to hire the right people, create the right corporate culture, and hope that a healthy amount of innovation grew out of such a mix. But that was yesterday.

Today, we can bottle the stuff. How? Well, for starters, try staging a hackathon. EdgeVerve Systems is going to host an internal hackathon this weekend. It's a 24-hour affair in which the smartest and the most innovative young computer scientists, software developers (and all-around hacks) from Infosys group are locked in a room and given time to come up with the most ingenious (and, we hope, market-changing) apps. From 10am on Saturday until 10am the next day (Sunday), these driven, young developers will duke it out with the hopes of unveiling the next great thing in IT.

More than 300 teams were nominated; just 50 were selected. This is the crème de la crème of the young, talented technologists who will one day run the IT world. We hope that by staging a hackathon, we're going to bring some of this talent to light now, rather than later. I'm reminded of a fascinating survey that Infosys Finacle and Efma conduct each year on innovation in retail banking. This past year, the survey found that a whopping 22 percent of banks stage competitions like hackathons for non-staff. Those banks are mastering the art of open innovation.

A colleague recently reminded me that the structure of a hackathon challenges the notion that 'everything we do in business can be done efficiently within a virtual context'. A spirited contest like a hackathon brings together a bunch of talented people into one room. They meet each other, share ideas, collectively innovate in a lighthearted, informal setting. They are also able to relax and brainstorm when they're up against tight deadlines. Such camaraderie can't be replicated in an online community.

We've given a structure to our hackathon through the theme: Technology Solutions for Our Cities. The teams that are chosen participate in this weekend's event are going to come up with solutions for cities on mobile apps, or on a combination of connected devices on cloud or an advanced analytics and Big Data solution, which can that help tackle urban problems like congestion, traffic, pollution, neighborhood development, and the safety of women amongst others. For these 50 teams, the sky is the limit and one thing's for certain: I will be watching the proceedings very closely.

The technology world has changed dramatically in the last two decades. In the past, any company with a 'dot-com' in its name could get a generous amount of venture capital seed funding. Today evangelists, investors, incubators and executives like myself are a lot more discerning and downright picky when it comes to funding new talent. We're looking for value-added solutions, not just for apps with cool names. We want solutions and services that work.

Luckily for everyone involved, the hackathon is what separates showmen from serious developers. I'm eager to see what 24 hours at EdgeVerve produces this weekend. Be sure to tune in next week when I blog about the results. And may the best hack win.

December 18, 2014

How to Renew Digital Healthcare Experience

Posted by Sanjay Dalwani (View Profile | View All Posts) at 5:41 AM

Eric Paternoster, President & CEO, Infosys Public Services, discusses a platform-based approach to IT that helps healthcare organizations shift focus back to their core business

Up until recently, health insurers in the US had little motivation to transform themselves into high-tech organizations. The age-old business model and legacy technology systems, though out-of-sync with the requirements of today's dynamic healthcare environment, have continued unchallenged for several years with little or no reason to change. Yet a recent market phenomenon is now influencing key changes: the rise of digitally savvy consumers. Did you know, that more than 95 million consumers use mobile devices to access health information and tools? And that 40 percent of them visit one or more websites to research new health insurance plans?

Indeed, health insurers are being nudged out of their comfort zone. Business-as-usual approach by consumers, who are looking for competitive offerings, expect to be better engaged and are looking for superior customer service. Our survey reveals that six out of 10 healthcare insurance consumers feel that they do not fully understand their coverage and eligibility, and they expect better assistance and information in order make right choices when it comes to selecting plans. What has long been a 'group-centric' business model in the health insurance industry, especially in the United States, is fast turning into a 'consumer-centric' one, thanks to digital. The entire healthcare realm is benefiting from this digital transformation and from the rise of consumerization.

No doubt, digital transformation helps health insurers meet changing consumer expectations and deliver a connected and consistent experience. Doing so, however, requires significant changes to existing systems, processes and also within the organization. Consider 'online shopping of health insurance plans' for instance. Digital channels, including private and public health insurance marketplaces have transformed the way consumers purchase health insurance. Health insurers can take advantage of this trend and improve consumer insights and engagement by digitizing marketing, commerce and service functions to deliver a superior experience to their consumers, across channels.

  • Digital marketing platform can help sense consumer preferences and needs across multiple channels, identify purchase patterns, and help create personalized campaigns to attract target consumers
  • Once target consumers are engaged, health insurers can use a digital commerce platform with a multi-channel store-front to facilitate shopping, comparison, and purchase of insurance products, online
  • Insurers can use the data collected via the marketing platform and combine it with in-house data e.g. member profile, claims history, contact center interactions, to recommend ancillary products that can help improve member care and improve loyalty
  • To improve customer service and productivity of contact center associates technology solutions today can help provide unified view of the member, help provide faster query response by aggregating information across multiple internal systems, and enable self-service capabilities on portals via live chat. That are some of the leading edge capabilities that can play an important role in improved customer engagement across channels

But, doing this with traditional IT adoption models can be extremely costly, time-consuming, and unpredictable, and health insurers need to rethink their approach to renew digital healthcare experience.

The president and CEO of Infosys Public Services, Eric Paternoster, recently discussed a platform-based approach to IT that helps healthcare organizations shift focus back to their core business. This approach can help health insurers accelerate their digital transformation initiatives.

Platform-approach will allow health insurers to 'acquire' core IT capabilities 'as-a-service'. So, instead of building the digital marketing, commerce, and customer service systems from ground-up, they can simply 'integrate' ready-to-use and configurable business platforms that help deploy these functions as needed, and pay per use. This way, they will be able to meet their business goals, without investing in complex and costly IT.

Such platforms also take advantage of best-practices from other industries like financial services, and retail, who have already gone through a similar consumerization journey through adopting a digital road map. Health insurers can access these proven practices and accelerate innovation.

The health insurance industry as a whole is moving towards a platform-oriented approach for digital transformation and realizing its benefits, which include improved consumer experience, speed-to-market, and lower costs. Many of our healthcare clients who recognized this groundswell early on are in the forefront of this transformation. With changes in the healthcare industry coming on fast and from all directions, more organizations will choose to leverage this new approach in order to deliver consumer-centric' care without the cost and burden of long drawn IT initiatives.

Related Reading:

Infosys platform-based approach to healthcare IT

December 16, 2014

Game on: Gamification Works Enterprise Wonders

Posted by Prasad Joshi (View Profile | View All Posts) at 4:37 AM

The Future of Gamification [Source: https://www.youtube.com/watch?v=usPHFhfDCq4]

Type the word 'gamification' in your Google search tab and you will know that it is a hotly debated topic, which is gaining momentum. At the heart, gamification is a simple idea: take gaming concepts that work and apply them in a non-gaming environment. In reality, however,  it is a lot more than just that.

In my view gamification is all about influencing user engagement and leveraging the human psyche to learn more in order to achieve a common goal. The common could be anything - solving a problem, increasing loyalty or creating new efficiencies.

For example, NASA developed a citizen science initiative for identifying features in images from space. Interpreting space images is a difficult task in itself but gamification has made this an exciting project. Zooniverse has similar citizen science initiatives, including butterfly counting and astronomy!

Yelp is a brilliant example of crowdsourcing. Every time I am looking for restaurant options in a new city, I Yelp the choices. On my smartphone, I get crowdsourced reviews, inputs, images and much more. Then there is Trapster that allows users to share road hazards, accidents to red lights in real-time; and Waze for traffic navigation.

LinkedIn revolutionized professional relationships. Your profile views are tracked, ranked, profile completion percentage is highlighted and 'contacts' are prodded for endorsements - all of these are crowdsourcing and gamification concepts that highlight the professional persona of an individual.

Gamification is finding a lot of success in the health and fitness industry. Fitbit, a popular wireless wearable device, measures data such as the number of steps walked, quality of sleep, and other personal metrics. You can even add a 'compare' feature to monitor your progress against your friends. Apple iOS' recent update features a Health app, which tracks all your fitness data.

As a concept, gamification is not new. All kinds of customer loyalty programs (airlines, hotels) encourage consumers to stay loyal by choosing their services again and again. The more you do, the higher you go on their categories - bronze, silver, gold, etc. Each ascending tier gives you better services/benefits. This, too, taps into the human psyche of game-playing and winning.

Gamification has also been adopted by the customer service industry. Training/learning initiatives for employees that leverage gamification are making their presence felt. We have seen increased use of gamification in customer service centers to foster knowledge sharing, adopting best practices and in knowledge management initiatives. A major insurance company uses gamification to help teen drivers with road safety and driving best practices.

The trick is to meaningfully harvest people motivation. This can range from intrinsic motivation such as gratification (citizen science), social value (LinkedIn profile views) to extrinsic motivation such as exclusive rewards (airline frequent flyer programs) and gains. In the enterprise space, we believe gamification has a huge potential. When businesses capitalize on their customers'/employees' penchant for solving riddles and winning, to solve a problem in which they are not trained/are experts - they fumble upon efficient and amazing results. In the end, gamification is all about efficiently tapping into a large crowd's desire to come first!

December 11, 2014

Why a Utilities Game Is Afoot

Posted by Ashiss K Dash (View Profile | View All Posts) at 4:56 AM

Gamification will drive customer engagements in the utilities industry

When the city of Detroit went dark last week, the event was a grim reminder of just how old a lot of America's energy infrastructure is going. Electric cables and transformers that date back to the 19th century only have so much life left in them.

Of course, Detroit like many other cities is going through its own challenges - the beleaguered city has filed for bankruptcy and has trouble finding the funds to keep municipal agencies humming. Yet the prospect of a massive power outage should be a wake-up call to all utilities that are focusing on improving their equipment and customer service. Amidst this, well, dark backdrop I've become a fan - like many utilities executives around the world - of a way to pump life into customer service and engagement and have a lot of fun while doing it. I'm talking about gamification.

Now don't get me wrong here: I'm not talking about an electric utility's version of Grand Theft Auto or Angry Birds. I'm referring to an interface that leverages the human psychology in a way that leads to significant corporate efficiencies and cost-savings. The psychological aspect primarily focuses on the human urge to win - or, better yet, beat one's neighbor in a friendly contest. The very best enterprise gamification platforms are such that the consumers 'playing' along don't realize they're part of a structured, customer engagement program.

That's important, because an organization can learn a lot about its consumer base when that base doesn't know it's being studied and scrutinized. Even more important is the fact that utilities have a lot of catching up to do in the realm of customer engagement when compared to other sectors. In the retail world, for example, stores are well versed in using sophisticated IT platforms and data mining techniques that tell them what kind of customer is buying which product and what kinds of promotions bring the most people through the door (or onto the website). Utilities in America were heavily regulated for most of the last century, so the desire to connect with customers was never an element that ingrained in their corporate culture.

That desire to connect sure is becoming ingrained today, however. And it is moving very fast. Along with a mandate to renew and update the country's energy infrastructure, utilities are dealing with the pains that come with de-regulation; that is, become self-sustaining, profitable enterprises. But there still are regulations to deal with in this brave new world. Consumers are also curious to participate in key initiatives like Energy Efficiency programs. A combination of de-regulation with energy-savings goals makes gamification the ideal technique for many utilities to more forward with their ambitious plans.

Gamification is going to help them get to where they want to be in the next decade. Here's one ingenious example: Rhode Island might be America's smallest state by area but it's big on sophisticated gamification platforms to save energy. The state's electric provider, National Grid, has instituted a program whereby customers can compete with their neighbors to save on household energy. Those households that do the best are rewarded with special deals and coupons redeemable at retailers like Amazon.com, Home Depot, and even Starbucks. The utility not only pits neighbor against neighbor, some of its gamification tools involve town-wide contests. The community of North Smithfield became the first in Rhode Island to get 5 percent of its residents to join a community energy-saving contest. National Grid's response? The town received $7,500 towards eco-friendly products like solar panels and specially insulated window frames.

Contests like these succeed because customers can go online to experience customized gamification portals to see how their households and their communities measure up. The urge to succeed is a strong human emotion, and when it's presented in easy-to-use online dashboards, customers feel more engaged with the utility and its energy saving efforts. Those savings will go a long way in updating an infrastructure that's in dire need of it. Gamification IT in the utilities space ensures that everyone is part of that mission.

December 9, 2014

Why Banks Need An Internal Payment Utility

Posted by Mohit Joshi (View Profile | View All Posts) at 4:45 AM

The speed at which a bank carries out a transaction can be its main attraction over a competitor

We've all heard the saying: old habits die hard. When it comes to the world of banking, the laundry list of old habits that we hang onto can be impressive - especially when you're talking about American banks.

Most of my American friends conduct their day-to-day, personal banking not unlike Americans before them did, some two-and-a-half centuries ago. Think about it: the banking system in America is older than the United States itself! For example, if someone were to receive a bill for his electric utilities in the mail, he would take the checkbook out of his desk, write a check to the utility company for the amount due, and then affix a postage stamp to the envelope and drop the payment in the mail.

What I've just described could have taken place in 2014 or 1914 or (if there were such thing as electric utilities at the time) even 1714. Now here's the kicker: the back-office banking functions regarding this mailed-in check payment are just as antiquated. Banks have complicated clearinghouse functions that date back to the 18th century.

In the digital era, however, banks would be smart to investigate faster payment systems. And, more importantly, the consolidation of them. After all, consumers are savvier than ever, and the speed at which a bank carries out a transaction can be its main attraction over a competitor in an ever-heated marketplace. Likewise, if you've ever been to an emerging or even a frontier market, it's amazing to see the contrast in banking with the West. An individual can pay his month's utility company bill with a couple swipes of his smartphone. No fountain pens required!

When it comes to their banking systems, the emerging and frontier markets have no old habits, so there's nothing that needs to die first (or die hard) before a slew of legacy systems are replaced with a fast, digital one. Indeed, there is a certain logic for having a single, internal payment utility in a bank. Such a system is a great way to reduce risk in an increasingly risk-filled world. Plus, those banks that are looking for new ways to reduce costs can do so by consolidating all their payment systems into one, streamlined process.

And let's face it: today, it's more likely than ever before that someone in the West will do banking with emerging markets institutions and vice versa. So each bank's cross-border regulatory and compliance standards must be, well, 'multi-disciplinary' in nature. Electronic funds transfers (EFTs) that have become a staple in global commerce can still take days to clear, depending on the countries involved. That's yet another reason for commercial banks to invest in the right IT. They would do well to get their internal systems onto one, seamless utility.

December 4, 2014

Digital Ascendency Demonstrates Need For Right IT

Posted by Suryaprakash K. (View Profile | View All Posts) at 3:31 AM

What is Internet neutrality? [Source: https://www.youtube.com/watch?v=2psly3euy78]

One of the recent gatherings of world leaders took place in Beijing at the Asia-Pacific Economic Cooperation (APEC). Top on their agenda? Not run-away epidemics, military campaigns, or the global economy. First on the list was the Internet.

If you don't think digital platforms have matured to the point where they're pervasive and downright influential, then consider what world leaders are discussing. The APEC conference brought the issue of Internet neutrality front and center.

Suppose I pick up the telephone to call a plumber. But in the middle of the telephone call, a competing plumber is patched into the call and cuts off my original conversation. Then the new plumber offers me his services instead. Of course, your telephone company would never do such a thing. Yet the scenario I've just described is what could happen if the Internet is divided into fast lanes (enterprises that pay to be on them) and the rest of it (those that won't or can't pay). You can bet that the issue of 'Internet neutrality' will consume world leaders in the months and years to come.

The big picture here is - regardless of whether broadband companies get to set up various pay-to-pay lanes across the Internet - that having a mere digital presence doesn't cut it anymore. It's how effectively you leverage that presence that's meaningful. For example, I was fascinated that one of the biggest online shopping days of the year is now November 11. It's called 'Singles' Day' in China, when tens (and perhaps hundreds) of millions of single Chinese consumers go online and buy something for someone they are fond of.

The day has turned into a bonanza for e-commerce giants like Alibaba and its smaller rival, JD.com. China will soon be a larger e-commerce market than the United States, the United Kingdom, Germany, Japan, and France combined. Yet I keep reading reports about those e-commerce giants getting sub-par reviews from their consumers. Why? Well, the online shopping experience tends to be easy and efficient. It's getting the merchandise to the intended person on time and intact that's the issue.

Being a huge Internet retailer isn't cutting it anymore. E-commerce enterprises need to focus on the kind of Information Technology that can make their operations 'end-to-end.' That is, if their strategy is online-to-offline, like it tends to be in China, the Internet must be a means by which logistics can happen. Deliveries can be tracked. And customer service ensured.

Whether or not the Internet stays neutral is just one issue facing the digital world. It seems to me that even if enterprises can pay for presence in a so-called fast lane, then they need their IT platforms to keep their operations streamlined and worthy of that lane. It's like placing a old car on a Formula 1 track and expecting to take first place. In the digital world, the winners are those that innovate their way to the finish line.

December 1, 2014

Predicting a Retail Transformation

Posted by Amitabh Mudaliar (View Profile | View All Posts) at 8:21 AM

Predicting a Retail Transformation

Buoyed by digital convergence, social media, Big Data and new technologies, the fast-changing retail landscape is at the cusp of an important transformation. Retailers, who were known as 'artists' for selling their merchandise on creativity and experience instead of math and science, now must cater to a new generation of buyers who hardly enter a store! To stay ahead of the game, it is imperative for retailers to not only accept the ways of digital shopping but also adopt new business models to attract and retain customers.

Up until few years ago, most company websites displayed a toll-free contact number at the bottom of the web page as the point of contact for customers. Should anything go wrong post purchase, it was pretty much the only way (apart from writing in) to contact the company. Today, thanks to social media, the avenues of communication have increased manifold.

Retailers who are using these points of engagement to their advantage are already marching ahead. For example, a customer might contact a company via social media to let them know about a product/promotion they have enjoyed or a grievance. The retailer of today uses this data to learn more about that customer's expectations to tailor-make offers and promotions in future. This, not only generates a greater brand recall, but also increases brand loyalty.

Online commerce is also entering a new and exciting phase. A few years ago, multichannel integration meant that a customer would shop online and collect the item at the store. The retailers today, are taking multichannel integration to the next level - they ship one-time-delivery items even to holiday destinations! Their data processing is sophisticated enough to know that the delivery address isn't likely to be used again - at least not until next summer.

Predictive analytics has been around for a while as a technology, but organizations have only just started to see its benefits in business. Retailers are keen to use the treasure trove of Big Data that already exists. It's just a matter of leveraging it as effectively as possible. An example is a store that is able to tell when a certain customer strolls in (or is online) and immediately predicts what he/she is likely to buy, thereby making a targeted offer. It's far removed from 'art' but then again, they are catering to customers who do most of their shopping on their iPads!

Furthermore, predictive analytics is helping businesses expand beyond retail. In this challenging business environment, a lot of retailers are interested in getting into new business lines. For example, a retailer might be interested in expanding into the financial services sector. This retailer must therefore be able to predict if its customers will also be willing to spend on say financial planning and transactions, banking products, loans, and mortgages from that retailer. This is where analytics plays a crucial role, helping companies transform and expand new business lines.

The retail industry is at an inflection point today. New avenues are offering great opportunities for retailers to transform their businesses. Technology used to be a big enabler of a retailer's strategy. Today it is the strategy.

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