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Transitioning To a Mobile Centric World

If you happen to be a sports fan one of the coolest features to emerge in our lifetime is the ability to program your DVR remotely. The game is about to start, and you forgot to record it. No problem — you can simply talk to your DVR remotely. It’s like magic. When you get home your game is there. This has supported this feature for some time. Initially on the Internet via the browser and more recently via their smartphone application. Ironically, the smartphone version of this experience renders the browser-based experience antiquated, even painful.

On the browser, the  user is always required to sign-in, which is time consuming and tedious. Plus who remembers their TV provider’s login credentials? On the iPhone, the user is never required to log-in, which is a remarkable contrast. So the desktop navigating the schedule is cumbersome, slow, and deep in the feature hierarchy. On the smartphone it is quick, responsive, and right up front.


For a large variety of applications and services, users favor mobile applications over browser based applications. Over 45% of Yelp’s* searches begin on mobile. For Zillow*, 50% of home views are now on mobile. For each and every Internet company out there, mobile is rising as a percentage of all user visits. Mobile applications are instantly accessible as the smartphone is always with you. The applications can also leverage mobile-only features such as GPS search and the camera interface. And many of them, like the DirecTV application, are simply designed better. Many will argue that there is a safe middle ground where you can “have your cake and eat it too” — the HTML5 based “mobile web.” Yet early user data disagrees. A recent Compuware survey found that 85% of users favor apps over the mobile web. Guess whose vote matters most?

When users greatly favor a new user experience over an old one (in this case the mobile application environment versus a browser based desktop environment), the implication is clear – we are in the middle of a critical platform transition. Platform transitions are rare, yet highly consequential. The first consumer-based transition was DOS to Windows in the late 1980s. Many fortunes were won and lost based on how well companies like Borland and Lotus executed this transition. Then came client-server, which also launched new winners at the expense of older incumbents. The next obvious transition was the rise of the browser in 1996, which transformed not only the software application market but also the print and media world.


The browser-based Internet launched many new companies, several of which have achieved market capitalizations in the billions. Most interestingly, new company wealth (pure play Internet companies) far exceeds “transitioned wealth” (incumbent companies transitioning their model successfully to the new platform).

We are now seeing a new transition – away from the browser and back towards stand-alone applications, this time on mobile devices. We are also seeing the emergence of mobile-only companies whose presence is singularly focused on mobile as opposed to the browser based Internet.  Key examples include Instagram*, Uber*, Snapchat*, and a variety of game companies like Rovio, Supercell, and Natural Motion*. This critical platform shift should weigh heavily on the minds of all companies that have something to lose; primarily browser-based Internet incumbents. The stakes are quite high, and it may even be too late.


As we transition from one world to another the rules are changing under out feet. The development tools are different, and the development objectives have changed. The distribution techniques are completely new. On the browser, SEO and SEM are paramount, but the equivalent tools on mobile are either non-existent or at best immature. Living in the middle of these two worlds simultaneously creates interesting and unique challenges. Yet the consequences of not playing are high. Here are some key considerations as you look to map the mobile application transition for your own company.

Design takes on a greater role. Users favor mobile applications that are crisp, clean, and quickly responsive.  Like a remote control, it should be quickly responsive, and do what you want with very few button clicks. The Uber* experience is a great example. Press a button, receive a ride, and everything else disappears – even payment is automated. Websites do not always have this same “one-click” usability expectation, and as a result web designers can easily come up short by building mobile applications that are overly complex. The limited screen real estate , and limited user-attention on the smartphone forces better design decisions. Lastly, lower mobile bandwidth (versus the desktop) increases the consumer benefit of pre-cached content and UI.


Feature depth is inherently limited. Consumers clearly dislike deeply nested features on mobile phones. They prefer the remote control “one button” experience. They want to get in, solve their problem, and be done. This is challenge for larger feature-rich sites like Facebook and Yahoo, and a real benefit for focused best-of-breed providers like Instagram. It is also why YouTube, Google Maps, Facebook messenger and Vine are separate from their mothership. This limited depth concept is huge and vastly misunderstood. Mobile values the single solution, one sharp blade rather than a Swiss army knife.

Development complexity is a reality as we transition. Not only do you have to continue to support the desktop web, but now each company must develop and test for iOS and multiple flavors of Android. These may not be skills you have in-house. Plus the design elements of the app world are different, implying that your desktop web developers may not be good at mobile app design. If that were not enough, you now have to support the “mobile web” platform also to capture any users that have not downloaded your application. Unfortunately, this is table stakes. You don’t get to choose not to play. One might think that this type of complexity favors larger companies with more resources. However, this is offset by the fact that larger mature companies typically lack the skills and the adaptability to develop quickly on new platforms. Complexity in this case favors the newcomer.


HTML5 is a head-fake. Due to the design complexity outlined above, many developers attempt to short-cut the system by blending elements of the desktop or mobile web world into their applications (or will argue to simply wrap HTML in a container and call that a mobile app). This is a dangerous decision where the developer is optimizing for themselves and not the user. You should never optimize developer convenience over user experience. One high profile example of this is ESPN ScoreCenter. You move through the different leagues and scores with blinding speed. However, try to download detailed stats and you can see the app open an embedded browser and load a web page. A user cannot help but feel cheated as they wait for this “page” to load. Does ESPN not have enough resources to build a fully native iPhone app?

SEO non-presence is hugely consequential. One of the key reasons that mobile apps have a cleaner design is the absence of SEO (search engine optimization). Design on the desktop web has been compromised by the need to intersect with Google’s search paradigm. This is the same reason no one uses Adobe’s Flash on leading web sites. “Links,” “deep linking,” and “structured taxonomy” are fundamental design requirements for the desktop web. No one can afford to risk losing their SEO mojo. Mobile changes that paradigm, and most of the emerging mobile-first companies listed above are non-SEO focused.


As an example, Twitter’s lack of an SEO centric product made mobile app design much more straight-forward. Of course, the absence of SEO may be positive for design, but it removes a key customer acquisition strategy for many startups. Deep linking into apps is emerging as a new paradigm, but this is primarily a tool of incumbents with a large previous SEO presence.

The core concept of “search” is in transition. Search plays a completely different role on the desktop than it does on the smartphone. On the browser, nearly every activity starts with search. On the smartphone, apps replace search as a starting point. Consider the case when you are curious about the weather forecast? On the browser you might simply type “weather 94025” into the browser. On the smartphone you never do this. The same could be said for an Amazon search, a Yelp search, or a LinkedIn search. On the smartphone, these searches start in the application. This trend is quite positive for early smartphone application leaders.


A locked-in mobile application user is worth more than a desktop user. Talk to any leading Internet company, and they will echo this philosophy. The logic is that once a user goes through the trouble of downloading an application and committing their limited screen real estate, they are now a more committed user that will use your app more frequently and churn less. These early applications leaders become functional “goto” apps for the user. Going to a competitor is not as simple as doing another search, or clicking on another link. You have to go to the trouble to download a whole new application and learn a whole new navigation interface.

Customer acquisition techniques are shifting. Startups like tried and true browser-centric customer acquisition techniques like SEO and SEM, but the mobile app world is different. To make matters worse, no new systematic customer acquisition model has emerged. Embedded placement deals would seem likely on Android (they were prevalent on feature phones), but this environment still feels nascent. More surprisingly, neither Apple nor Google offer the equivalent of SEM slots alongside their app store taxonomy (although this appears quite common in China). This represents a huge missed opportunity for both platform providers, and a missing resource for companies that wish to pay to acquire users (of which we all know there are many).


Payment could be a new platform battleground. Continuing with the “remote control” theme, users will clearly want payment to disappear into their button-pushing experience. Many large credit-card/credential holders such as Amazon, Apple, Ebay/Paypal, and Google, have a great deal at stake in this battle. And of course, incumbents like Visa, Mastercard, Chase Paymentech and Bank of America have a view, as do disrupters such as Square, Braintree, Stripe, and Swipely. Even the large physical retailers see this as an opportunity to pry themselves out from under the 2%+ credit card payment fee. They have created an entity called MCX precisely with this in mind. We have been waiting 15 years (remember Microsoft Passport?) for one-button payment. Whoever delivers will be in a very strong strategic position, especially if they can also disrupt the processing fee. But prepare for a battle royal.

The platforms are still evolving. iOS and Android are dynamic platforms, and both Apple and Google are still evolving their corporate strategy for each. Google would likely favor an HTML centric world that returns search on the smartphone to the central place it holds on the browser (notice the recent voice search announcement). As they invented the app-centric Smartphone world we inhabit, Apple is likely to keep pushing in this direction. They even brought the app store backwards to the Mac desktop OS. Lastly, competitive dynamics may force each provider “up the stack” eating into the app ecosystem. We have seen this be the case with both music and maps.


Who are in winners in a mobile application centric world? In the near term, a continued move towards a more app-centric world is a big boon for the application providers who have made the transition to mobile and “locked-in” real estate on user’s mobile devices. Not only is the app “locked-in,” but so is the navigation know-how, which clearly creates switching costs for new entrants. Users will only keep a small number of brands on their smart-phone, and they start their activities in these apps – not with a traditional search engine. This is not to say we will not see new entrants – witness Snapchat. But the combination of lock-in and a lack of a truly liquid new distribution hooks will favor the “new incumbent” mobile leaders.

The biggest losers will be the web incumbents who do not understand the rules of the new road, or the consequences of missed execution. Anyone lost in the desktop world who fails to appreciate the criticality of the mobile-first mindset is subject to demise. Consumers prefer mobile and they prefer mobile apps to the mobile web. Deny that reality at your own risk.

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