Relationships with handset manufacturers are one of the important elements of the i-mode ecosystem. It is important firstly for competitive advantage in specifying market-leading features, and secondly because usability of these features is a critical aspect of the service.
When handsets are used just for voice and simple messaging sales can be driven and customers satisfied with good design aesthetics, good pricing and by deploying a ‘product’ sales mentality. That’s not the case with i-mode.
With i-mode the design aspects remain just as important, but the performance and usability and sales experience all take on bigger dimensions. This is because not only do customers need to experience that it's easy to send e-mail or access the Internet, but they also have to be able to readily download software (games) and use still and video cameras, connect to PCs or photo kiosks, and to manipulate contact lists with complex links, options and parameters for each entry. The i-mode device is a rich service centre with a close affiliation with their owner!
In fact – and here is the conceptual breakthrough – i-mode is a true service brand.
In Japan, i-mode's success is in part thanks to the fact that it is marketed with an emphasis on services and the overall user experience - with no reference to the actual technology.
However, although they may deny it, brand managers have received the majority of their training focusing on product brands. Telstra, particularly in their reseller strategy, relies mostly on advertising, packaging and promotion and the accompanying imagery to shift handsets. This is a classic product brand management approach.
In contrast, powerful service brands, such as Amazon and Google can grow without conventional advertising, by leading their brand building with service and customer experience.
For i-mode success, what now becomes more important is the creation of a great customer experience where advertising simply amplifies the effect. This experience starts with the sale itself.
And the sales process has to be re-invented from the beginning to the end, starting with the absolute commitment to i-mode as service rather than handsets as just another category of packaged 'product sale' from the store.
Five key dimensions drive this design. Four are "in the box" and one out of the box.
Firstly, the requirement to fulfil the basic customer needs, and secondly do this with ease – or without problems and hassles. Thirdly, to provide clarity – this is about consistency of expectation - and finally, deliver an experience that is unique in that it stands out from the competition.
The fifth and "out of the box" driver is to generate excitement. Of course, excitement is a relative feeling, moderated by expectations, and hence its linkage to the third dimension above. Although it is not always high among customers, when created, it can achieve true differentiation.
With the i-mode service this excitement factor is all all-important. When done properly a price premium can be sustained and up-selling opportunities generated, and this is where the increase in ARPU and return on investment start to accrue.
We know that problems with handsets, in various dimensions, such as usability, availability, and functionality, have caused serious setbacks for carriers offering advanced services. This occurred in some European i-mode implementations, in Telstra’s Mobile Loop implementation where they reportedly wrote-off $100m in hard costs alone, and even in DoCoMo itself when they rolled out their first FOMA 3G handsets (see this report).
If these lessons are not learnt in Australia, before Telstra rolls out i-mode, then business success is by no means assured.
According to a report by Analysys, operators should learn from the success of Vodafone and i-mode operator NTT DoCoMo in Japan. "We believe that many operators outside Japan will be able to replicate this success as long as they pay careful attention to pricing, marketing and availability of handsets," said the report's co-author, Alastair Brydon.
The sales process for i-mode, through the whole chain from own-stores through resellers, has to be re-designed, starting yesterday!.
Part 3 - Creating Excitement
Part 2 - Customer Segmentation
Complete Version (PDF, 6 pages, free) go to my website www.digitalinvestor.com.au
To understand better the i-mode business model see my related blogs on imodestrategy.com:
Why the Open Mobile Terminal Platform Alliance is a Win for the i-mode Business Model - hereWhat's your view of the sales process for i-mode - what changes are needed and why? Post your Comments.
Why the Analysts Have It Wrong About Telstra's new i-mode Alliance - here
The Delicate Balancing Act of Sustainability for Mobile Game Content Providers - here
For rigorous expert independent audit and advice, no matter where you are in the i-mode ecosystem, call me.
Email me; Call (Australia) +61 403 345 632"I can personally recommmend the Mobile Intelligence Tour as the most effective, most intensive and most enjoyable way to acquire business insight into the Japanese mobile economy and the people behind it," Walter Adamson. |
Comments