Mobile is rapidly growing, both on phones as tablets. Mobile usage is increasing at the expense of other media like TV and internet. Most phones sold already have mobile internet access. M-commerce is growing faster than e-commerce. However, consumers only slowly adopt mobile commerce due to poor user experience on mobile sites, lack of safe payment methods, and low awareness of mobile apps. Companies need to develop tailored mobile strategies using mobile sites, native apps, or hybrid apps to seize the mobile opportunity.

1. Mobile
Seizing the mobile opportunity
Amsterdam 2011-2012

2. Harvest is a unique consulting firm with a clear framework and
focus: We help companies make money on the web
Harvest online business development framework: three ingredients form the basis of our work
Strategy and 1 Make it happen 2 Consumer 3
monetization insights
 Thorough analysis and conceptual  Powerful in execution  Consumer centric thinking in value
thinking proposition
 In-depth specialists in online
 Vision development and business  Creative, yet pragmatic solutions
modeling  One stop shop including technical based on consumer insights
implementation
 Overall picture of online in its multi-  Strong commercial gut feel on what
channel environment consumers want
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3. Harvest expertise is captured in pragmatic packages that optimize
your existing business…
Optimizing existing Advertising Product Definition Harvest Academy
business:
seven pragmatic packages How to optimize your advertising Leveraging product for business Turn your employee into rock stars
pixel success  Training by consultants on online
 Combine short term revenue  Ensure your business goals are topics: mobile, advertising,
increase with a solid long term realized by your product strategy, commerce, etc.
plan  Create or improve your product  Cross-learning with other
 Get most out of your premium with our immediately actionable companies or tailored for you
pixels implementation plan and  Unique training methodology,
 Set-up your remnant inventory interaction designs experienced trainers and
analytical, lean and mean inspiring atmosphere
1 2 3
Monetization quick scan AdSense optimisation Harvest Share & $ave button Business performance dashboard
From good to great Take your revenues to the Acceleration word-of-mouth Insights from vast data sets
 Identify optimisation next level  An average Facebook Wall Post  Automate data harvesting from
opportunities  To optimize your AdSense, leads to 3.2 new visitors multiple sources
 Practical projects with testing and tweaking is essential  Low involvement categories  Automate visualisation of the
detailed execution directions  Harvest helps to start and need an extra push to share business KPIs
 Top line growth of current optimize Adsense  Harvest Share & $ave button is  Professionalise overview needed
revenue streams  We have a double digit growth an off-the-shelf solution to to optimise
international track record reward visitors to share their
purchase
4 5 6 7
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4. …or help you kick-start a new business opportunity
New businesses: Mobile New business development Social commerce
seven pragmatic packages
Seizing the mobile opportunity Entering new markets with new Where marketing & commerce
 Mobile is rapidly growing, both on concept become one
phones as tablets  Most online companies already  Enormous traffic and time spent on
 Companies are struggling to have strong cards in several social media provides an opportunity
combine successful consumer markets for social commerce
activation with solid business  New opportunities in other online  Social commerce is not just opening a
models for mobile markets can be found by smart shop on Facebook, it is about driving
 Harvest helps to deliver an analysis and creative thinking sales through sharing
actionable mobile strategy, with a  Harvest makes a business plan for  Harvest can create a product/service
solid business case, ready to be a new concept to develop an social commerce strategy,
implemented online footprint in a including a live f-store &
1 new market 2 traction plan 3
Market entry strategy M&A support I M&A support II Setting up a direct to consumer (D2C)
How to enter the Dutch and Unique opportunity to acquire real Ramp up your start-up How brands can expand their role in the
European market gems  Harvest understands the world of value chain
 High level market scan  General mismatch in culture and start-ups as well as professional  Setting up an online D2C is a way for
 Map market entry strategy into approach between start-ups and consulting brands to expand their role in the
action plan corporates  Harvest professionalizes your value chain
 Execution action plan and  Harvest is able to bridge the gap newly acquired business for the  However, online and retail are not in
document learnings and to select the best targets long term… the DNA of traditional manufacturers
 Harvest provides ready-to-  … and helps to execute low  Harvest can help brands to
execute investment opportunities hanging fruit to ignite set-up an online D2C channel
including investment growth immediately for a manufacturer
proposals
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5. Mobile

6. Mobile is on track to eclipse desktop
Number of global users [mln] Facts
 Mobile will beat
2,000 desktop usage in 2013
1,800
 In 2014 there is 90%
1,600
penetration of mobile
1,400 internet access
1,200
1,000  Ex-Google CEO Eric
Schmidt: current
800
adoption of mobile web
600 is 8x times faster than
400 PC adoption in early
days
200
-
2007 2008 2009 2010 2011 2012 2013 2014 2015
Desktop Mobile
Source: Morgan Stanley (2011), Gartner Research (2011), Eric Schmidt (2011)
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7. Most phones sold already have mobile internet access
Sales of phones in The Netherlands [2002-2013, in 1000s of units] Facts
 End of 2010: 3.3 million
7000 smartphone users in
The Netherlands.
6000
400 500
400
1000  In 2011 smartphone
5000 200 1600 sales will be higher than
0
3050 GSM sales.
4000 4079
0 5147
3000
 Conservative estimation
0 5400 5500 shows that ‘dumb’
4800 5000 5000
2000 4200 4200 candybar phones will
3700
2880
hardly be sold in 2013.
2600
1000 1970
1022
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
GSM Smartphone
Estimation
Source: GfK (2010, 2011); Harvest forecast analysis
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8. Mobile usage among consumers growing really quickly, at the
expense of other media
Average time spent per day with major media [2009-2010 YoY, %] Facts
 Time spent per day with
28% mobile increased with
28% YoY.
 Internet: 155 minutes
per day; mobile: 50
minutes.
 Consumption of mobile
media (video, music)
6%
increased with 600% in
the last year.
-1%
-2%
Radio TV and video Internet Mobile
Source: Emarketer (December 2010); Video and music requests through mobile phones, Limelight Networks (May 2011)
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9. M-commerce is growing faster than e-commerce and
in a steady tempo…
Consumer spending through mobile commerce [USA, billions] Facts
 Top products purchased by US mobile buyers (excl. ringtones, apps, music, video, clips): consumer  Forrester estimates
electronics (57%), books (42%), clothing (34%), computer hardware (31%), jewelry (16%) mobile spending in
2012 at $10 billion
$25 (USA).
$19
 48% of US consumers
are already using their
$14
mobile devices to
research and browse
$10 products and services.
$6
$3
 PayPal expects the
number of m-commerce
transactions to grow by
2010 2011 2012 2013 2014 2015 a factor of 10 in 2 years
(worldwide).
% of
eCommerce
1% 2% 3% 4% 5% 6%
Source: Forrester Research (2011); Oracle ATG (April 2011); PayPal (2011)
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10. …but consumers only slowly adopt (for three clear reasons)
User experience on websites not adapted to characteristics of mobile devices and needs of Conclusion
consumers
 Limited special mobile features (shopping list, QR code usage, etc.)  A better user
experience will increase
 A mobile template is not a mobile site!
m-commerce adoption.
No safe and easy payment standard for mobile
 Mobile version of Ideal
 Currence will launch mobile version of most popular paying method Ideal beginning 2012 will boost commerce
 Rabobank will start experimenting sooner with own mobile payment method through mobile.
Low awareness among consumers  New apps with added
 No specific commerce-related apps value will raise
awareness among
consumers.
Source: Currence (2011)
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11. Smartphone and tablet require tailored app or site, as these devices
have specific usage patterns
Smartphone Tablet
[6.6% of all browsing traffic] [2.2% of all browsing traffic]
Typical user 2010  Very diverse  Male (89%), 25-54 (76%), HBO/WO (73%)
Typical user 2011  Very diverse  Male (81%), 25-54 (71%), HBO/WO (67%)
Timing:  Mainly in the morning (7.00 – 9.00)  Especially in the evening (18.00 – 22.00)
moment of day used  Small peak during lunchtime (12.00-13.00) and end of
workday (17.00-18.00)
Sessions per day  Multiple times a day, short sessions of a few minutes  Multiple times a day, approx. 1 hour total
Usage  Used in ‘downtime’  Used very intense
 Used mostly alone  Often shared with other users (kids, friends)
 Used especially when no iPad of computer is present  Used at different places: couch, toilet, in bed
 More used on the road than home (=3G)  More used at home than on the road (=WiFi)
Apps installed  15  25
Users using media apps  55%  70%
Source: Sanoma Digital, data Nu.nl (October 2010, June 2011); Trends in Digitaal lezen, IntoMart GfK (2011); expert interviews; Netmarketshare (July 2011)
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12. Different types of apps can be made for mobile devices
Conclusion
User experience
 Depending on specific
wishes, companies
should choose either a
Native apps mobile site, native app
 Programmed for one or hybrid app.
Mobile sites (web apps)
platform
 Cross-platform
 Use all special  HTML5 offers
compatible Hybrid apps
phone features such opportunities to
 Not all phone  Native app with embedded as GPS, address
features supported HTML; therefore cross-platform develop low-cost apps:
book, phone camera
 Hosted on compatible works on all platforms
 Distributed through
server, distributed  Access all special phone app and is easy to develop
through the web features such as GPS, address store/market, downl and debug.
book, phone camera oaded and installed
 Distributed through app
store/market, downloaded and
installed
Cost and time-to-market
Source: Harvest analyses
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13. Most companies do not have a clear mobile presence at all;
frontrunners are now taking competitive leap
Three laggards and explorers Frontrunners Conclusion
 Hunkemoller does not have mobile  Bol.com: +200% mobile turnover July  Most large companies
presence 2010- Feb 2011 still lagging in mobile
developments.
 HEMA only has a photo app  Drogisterij.net: in 2010, 3% total turnover
mobile and 6% in 2011
 An exception are the
 MediaMarkt has very simple site without
real additional value  Thuisbezorgd.nl: 5% of total turnover in frontrunners who
2010 already start to gain a
competitive advantage
 Appie: basket size & traffic to AH stores in mobile.
 PayPal: 41% of large
Dutch webshops offers
a form of m-commerce
end 2011.
Source: Bol.com, Drogisterij.net, Thuisbezorgd.nl, Gartner, PayPal (2011)
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14. Drogisterij.net is a frontrunner in mobile sales of grocery
Currently: Drogisterij.net sells more Expectation: mobile sales will triple in
than 3% through mobile 2012
 Drogisterij.net is growing rapidly;  CEO Drogisterij.net expects 6%
total turnover was already >€6 sales through mobile end of 2011
million in 2009
 A new mobile site will boost sales
 3% of all orders is placed through
mobile device (June 2011)  Sales is expected to be 3x higher in
2012 than in 2011
 No iPhone/Android/other apps
 Mobile site with UE almost
comparable to Bol.com mobile site
 Most typical ‘offline’ grocery stores
as Kruidvat and Etos do not yet
offer apps; DIO Drogist has a
simple app for drug information
Source: Drogisterij.net blog
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15. Projected mobile revenues from (in-)app sales and mobile
advertising expected to increase
Global app store revenue and mobile ad market revenue [$, billions] Facts
 Global revenues for
sales of apps and within
apps are expected to
triple within 3 years.
$19
 Total app store
downloads will reach
17.7 billion in 2011.
$11
$6  Mobile ad market H1
$39 2011 NL was €1.2
$3 $27 million, is starting to
$20 ramp up, and will grow
$1 $13
$5 in a faster pulse.
2010 2011 2012 2013 2014
In-app revenues Ad revenues
Source: Gartner (January 2011); NB: IDC (December 2010) made different estimation; IAB, Ad Spend Report H1 2011
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16. Still, the business models are currently not multi-million dollar
opportunities for three reasons
 Relatively low mobile reach Future expectation
- About ±5% of total traffic comes through mobile devices
 Mobile usage is
increasing; will make
 Consumer not willing to pay for services business models more
- Exception 1: services that are really premium attractive.
- Exception 2: services where users are used to paying for non-mobile alternative (e.g.
newspapers)  Consumers learn to pay
for mobile services (e.g.
 The app store and ad revenues are not cash cows (yet) Spotify, data packages)
- App store revenue is limited: average price €0.79 - €1.99 per app minus VAT and
revshare app store  Parties as Google have
- Low revenue of mobile ads: €0.10 eCPM networks, €3-€5 eCPM direct, but low sell- entered mobile ad
trough triggered by smaller screen (less placements) market; eCPMs of
- Ad market still small: currently 0.5%-1.0% of total ad market mobile ads are
expected to grow.
Source: Harvest research
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17. So what business model does work? Eight business models for
mobile with their pros and cons
100% free Advertisement Ads + premium features Driving indirect sales
Free app with free content Free app with advertisement Free lite access with ads; then pay Increasing basket size or traction by
not pay directly
Consumer does
for premium features leading consumers to other channels
 Large potential reach and usage  Some revenue; enriches sales  Revenue from ads and  Increases customer
− No revenues proposition subscriptions satisfaction, loyalty, indirect sales
− Sales force needed; too many ads − Paid subscription puts a brake on and allows PoP marketing
will harm user experience usage − Direct results sometimes hard to
(=less page views) measure
Paid app Paid app with ads Paid subscription Direct mobile sales
Pay fee in app store to get access to Pay fee in app store to get access to Pay in-app subscription fee for full Select, pay and service through
the application, all content is free the application, plus ads around access; app includes 1 time usage mobile channel
pays directly
Consumers
content
 Direct money  Direct money  Revenue from pay per usage  Direct revenue increase
− Fee puts a brake on adoption of − Fee puts a brake on adoption of − Paid subscription puts a brake on
app (and thus reach) app (and thus reach); bad user usage (=less page views)
experience; not a logical choice
Free Ads around Pay for Pay for
content model content model premium content model transaction or product
Source: Harvest research; Intentionally left out: 2nd screen monetization and adding mobile experience to offline (retail) channels
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18. Most important take-out in current market: mobile is not a direct
driver for revenues (yet)
Analysis shows: mobile apps business models Mobile apps currently a hygiene factor, driving indirect
currently not interesting sales
 Business models for a media company where compared; Two possibilities:
none of them was highly profitable yet  Mobile as a hygiene factor: dissatisfier when not having
an app (e.g. Bol.com)
 Smartphone penetration is expected to reach 60% in
2012; a possible tipping point for business models  Mobile as a competitive advantage: driving indirect sales
(e.g. Appie) or improving proposition (e.g. ABN Amro
internet banking)
Source: Harvest analyses
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19. Albert Heijn and Bol.com developed apps to increase customer
loyalty and drive sales indirectly
Appie: Bol.com:
large investments, leading to more loyal customers mobile app can be seen as dissatisfier
 Millions euros investment in continuous product  5% of bookings now through mobile platforms and
development increasing; major part of mobile sales would be
otherwise bought through web platform
 Customers are extremely positive about Appie (4**** in
App Store and 4,5**** in Android Market)  Finally, mobile presence can be come a ‘dissatisfier’.
When a retailer does not offer mobile, some customer
 In a very competitive environment, Albert Heijn as segments will buy somewhere else.
market leader succeeded to gain growth in market share
Source: Harvest analyses, Distrifood (2011), Bol.com (2011)
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20. The future of mobile: Tesco introduced a shopping concept based on
QR codes
Tesco’s Home Plus
 Tesco in South Korea created the Home
plus virtual store that allows customers to
shop at their leisure
 The user purchases the groceries by
scanning QR codes with a smart phone and
they are delivered for when they arrive
home
 Online turnover increased by 110%; Home
plus now number #1 in online grocery
sales in South-Korea
Source: Tesco.com; RetailDetail
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21. The mobile landscape is quickly changing, growing to a more mature
market
Today
€
!
t
From: Experimental phase To: Mature phase
Consumer  Online at one place (home/office)…  … and now online any time, everywhere
Market  Low reach (5-8% of total online)…  … but growing fast
Technology  Low-tech and inside-out driven  … but now high-tech and driven by consumer
development… needs
Business  … to professionalizing and growing advertising
 Business models in baby shoes… and app market
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22. Harvest brings together consumer perspective and business
perspective in a pragmatic mobile action strategy
Business perspective Consumer perspective
Find the right
Sweetspot
business models Offer the best
and monetize experience for
step-wise consumers
 Companies see chances;  Consumers
willing to experiment harvesting increasingly using
and learn m-commerce as it as
fast, easy, and 24/7
 Challenge is to transform
opportunities to  Experience is
concrete plans and currently under par
business model
Mobile action strategy
 Trust is too low
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23. Harvest takes into account internal strengths, and opportunities in
the market to create an actionable mobile strategy
Internal 1 External analysis 2 Action plan 3
strengths mapping
Actions Actions Actions
 Strengths and capability overview  Consumer behaviour: mobile  Choice of most suitable business
usage and needs per target group model
 Evaluation of current traffic and
traffic flows  Inspiration: (inter)national best  Business case
practices and examples
 Strategic choices and building
 Competitive analysis: mobile blocks for product
activities of competitors
 Sketches of product based on
 Trends: relevant trends translated building blocks
to insights & actions
 Action plan with timeline
 Technique: choice for
native/hybrid/web app
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24. Harvest cooperates with clients to create an actionable strategy using
interviews, analyses and desk research
Internal strengths mapping: External analysis: expert interviews Action plan
interviews and data analysis and desk research
 Interviews with stakeholders and  Interviews with experts on mobile  Define possible mobile business
management app development & mobile trends models
 Analysis of current (mobile) traffic  Analysis of mobile market, trends  Calculate business case
to site and app and technical developments
 Create planning for app
 Evaluation of current initiatives  Analysis of mobile consumer development
behaviour
 Sketch preview of mobile app
 Review of competitors and best
practices
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25. We take it all the way: sketches based on the concept are input for the
third party that will actually build the platform
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26. Harvest serves an international portfolio of pure online players
and click-and-brick companies
"Harvest is without any doubt one of the very best e-consultancy companies in
the world. Excellent knowledge and expertise strategically, tactically, and
operationally, always with clear focus on top line results”
Francine van Dierendonck, Sr. Director and Head Global Philips Flagship Store
"The monetization quick scan that Harvest carried out for Compare Group
highlighted tactical improvements with direct upside and a strategic
opportunity. The Harvest team is very professional and has great knowledge of
e-retail and online in general.”
Ben Kerkhof, CEO Compare Group
"Harvest supported Experteer in their go-to-market in the Netherlands. The
professionalism, drive and in-depth knowledge of the Dutch online were key to
the success of the project and the launch of experteer.nl”
Nina Zimmerman, Head of Europe Experteer
"Harvest combines a strategic view on creating online success with the power
to execute. Passion for the online business, dedicated to deliver results. And
above all, a pleasure to work with.”
Marc de Vries, CEO Hyves
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27. Feel free to reach out to us for more information
Harvest – Online Business Development
Herengracht 262-266
1016 BV AMSTERDAM
The Netherlands
E: info@harvestamsterdam.com
T: +31 (0) 20 4277796
I: www.harvestamsterdam.com
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