Consumer Product Strategy

2012 Mobile Trends And What They Mean For Product Strategists

Thomas Husson — Thu, 09 Feb 2012 08:00:17 +0000

When revisiting our 2011 mobile trends, Julie Ask and I concluded that many, if not all, of them were still evolving and relevant. We have placed the main new trends for 2012 into four categories: business, ecosystem, consumer expectations, and technology.

Mobile Is A Key Business Strategy Enabler

Product strategists must work with other roles in the organization to:

Develop a scalable approach to delivering mobile services. Organizations will need a strategic approach to building and spreading institutional knowledge as well as governance for the development of mobile services.
Craft a mobile strategy that extends beyond phones. The emergence of tablets in particular will require a different approach than smartphones.
Differentiate on the delivery rather than the content of mobile services. In 2012, "how" mobile services are delivered will differentiate them -- not what they offer.

Mobile Ecosystem Success Will Elude Incumbents And Embrace Newcomers

Key mobile ecosystem trends include:

Book Business Outlook For 2012: Hard Work Ahead

James McQuivey — Mon, 23 Jan 2012 13:33:28 +0000

This week hundreds of us in and around the book industry will converge on Digital Book World 2012 (#DBW12). It's a conference that has risen in significance because this industry has rapidly come to understand that it is uniquely susceptible to digitization -- and poised to benefit from it -- in a way that other media are not.

This awareness has translated into relative optimism among publishers. As I'll share with the DBW12 audience on Tuesday morning, we recently conducted a survey with Digital Book World of publishing executives whose companies together earn 74% of all US trade publishing revenues. As we closed out 2011, 82% of publishing executives we surveyed were optimistic about the digital transition. That's a large number, even if it's smaller than the 89% it was a year ago. But when we take into account all the measures of optimism we threw at them -- about the industry in general, about the fortunes of readers, and the importance of their own roles -- most of them decreased somewhat and some decreased significantly.

Most tellingly, only 28% of these executives thought their own company would be stronger in the future because of digital compared to 51% who agreed with this sentiment the prior year. This suggests that publishers have started to do the hard work of making the digital transition and they're finding that it is, indeed, hard work. It's worth putting ourselves in the shoes of these publishing industry product strategists for a moment to consider just why they aren't positive that their companies are going to come out better off. I see three reasons:

Apple Schools Textbook Publishers In Education Innovation

Sarah Rotman Epps — Thu, 19 Jan 2012 16:23:40 +0000

At Apple's event today in New York, Apple unveiled iBooks2, a new version of its iBooks software that is tailored to interactive textbooks, and iBooks Author, an app that makes it free and simple to create interactive textbooks for the iPad.

There are already thousands of digital textbooks available on the iPad, as well as on other devices like PCs and Barnes & Noble's Nook Tablet. But as my colleague Annie Corbett and I have written, e-textbooks are a transitional product, accounting for only 2.8% of the $8 billion US higher education textbook market in 2010, according to the National Association of College Stores. The vast majority of digital textbooks are not very innovative; they're essentially print replicas with digital extensions like highlighting, search, and annotation. The iPad -- which now outsells Macs in schools, according to Apple -- is capable of much more than what has previously been produced, and Apple hasn't been satisfied with the status quo. Today, Apple demonstrated iBooks2, a new textbook experience for the iPad; these new textbooks can be created using iBooks Author. iBooks2 will solve two product strategy problems for publishers:

CES 2012 Preview: Tablets, Ultrabooks, And Wearables

Sarah Rotman Epps — Fri, 06 Jan 2012 13:30:00 +0000

It's that time of year again! Next week I'm headed to Las Vegas for CES 2012, along with 140,000 other people (bring your hand sanitizer!). Here's what I'll be looking for among the masses of gadgets:

Potential Nook Spinoff: Unlocking Value But At What Cost?

Sarah Rotman Epps — Thu, 05 Jan 2012 16:14:53 +0000

In a press release today, Barnes & Noble announced its intention to explore a potential separation of its successful Nook business in order to "unlock that value" and build upon its rapid growth (the Nook business will have an estimated $1.5 billion in revenue this year, according to the company). As PaidContent.org notes, international expansion could be a key motivation for the move.

I have been impressed with how Barnes & Noble has managed its Nook business thus far and I imagine that they have good reasons for exploring this separation. Nook has grown rapidly, but continued growth and international expansion will take sustained investment that B&N shareholders may not have the patience for. However, the Nook business has benefitted from synergy with Barnes & Noble in two key areas: 1) Barnes & Noble's channel (retail stores) and 2) Barnes & Noble's publisher relationships. It's not clear how a separate Nook business would function without the benefit of Barnes & Noble's retail stores and publisher relationships.

Nook has fueled Barnes & Noble's growth: What will be the value of Barnes & Noble without the Nook business? Where will the growth come from?

A key model for Barnes & Noble to consider is that of News Corp. and The Daily. News Corp. owns The Daily but it's managed independently, with its own P&L. The best scenario for B&N may be to pursue a similar structure, giving Nook the independence to grow and attract new investment but maintaining the synergy between Nook and B&N's retail stores.

Co-Creating Value At Disney World

Doug Williams — Tue, 03 Jan 2012 22:36:44 +0000

Happy 2012 to everyone!

I wanted to share a blog by an acquaintance of mine, David Deal, VP of Marketing at iCrossing. A few days ago, he posted about a new co-creative experience in Epcot at Disney World, wherein you the guest develop a virtual thrill ride, then board a contraption that simulates that ride. It's similar to the old Body Wars and Star Tours rides at Epcot and Hollywood Studios, respectively, but this time YOU create the ride, and YOU experience the creation -- including twists, dives and loops. Yeah, that's right: loops.

The thing is, you have to follow the principles of engineering in order for your virtual ride to work. Remember, this is Epcot, not Universal, so there's an educational component here. The introduction to the experience educates the guest about the physics involved with engineering a ride like this. While creating your ride, the program prompts you to make corrections where necessary to allow your car to finish all those twists and loops you've created. Raytheon sponsors the experience, presumably to show kids how awesome and fun science and mathematics are.

Pretty cool, right? I remember taking the Star Tours ride a loooooong time ago, and hearing about how the engineers had to be very very careful to align the motions of the pod with the visuals on the screen to (a) make it look real; and (b) keep people from getting (too) sick. Technology has accelerated to the point where hundreds of these experiences are now created each day (no word on how common motion-sickness accidents are).

Product Strategists Should See NFC As Much More Than Contactless Payments

Thomas Husson — Fri, 16 Dec 2011 20:46:02 +0000

A year ago, Forrester stated that 2011 would -- finally -- be the year that Near Field Communications (NFC) began to matter. We predicted that dozens of millions of NFC devices would ship and that the market would start moving away from being niche, although it would still be years away from becoming mainstream. Now that 2011 is coming to an end and it is once again the time for predictions, let's look back at NFC's year before we publish our report on mobile trends in 2012 at the start of next year.

I recently got confirmation from trusted sources that 35 million to 40 million would be a good estimate for worldwide NFC mobile phone shipments. 2011 was a game-changing year in that handset makers eventually started to embed the technology in their product portfolio.

Despite the hype about Google Wallet, the reality is that few consumers can use it. It will take a few more years before we reach a critical mass of not just NFC device owners but also users of services enabled by NFC technology. Why? Few services are available now; the out-of-the-box experience is still poor; consumer education is missing; and there's only limited availability of NFC readers in the retail environment.

Product strategists should stop focusing on NFC as just a contactless payment technology but should instead anticipate new uses for the technology that enable consumers to interact with the environment around them.

Most consumers using an NFC device in 2012 will more likely use it for device-pairing or data-sharing purposes than for payments. Why? Because it can work in a closed loop without the need for NFC infrastructure. Device manufacturers will offer NFC-based multimedia content sharing services, such as the recent Blackberry Tag.

Forrester's CPS Practice Welcomes Our Newest Analyst - Denée Carrington!

Carlton Doty — Thu, 15 Dec 2011 21:43:23 +0000

Over the summer, I asked you all whether we are finally headed toward a cashless society. Since then the battle for the digital wallet has certainly heated up. Well today, I am thrilled to announce the newest addition to Forrester's Consumer Product Strategy practice. Her name is Denée Carrington, and she will be joining us as a Senior Analyst, covering consumer payments, starting January 3, 2012.

To provide more specifics, here's a sneak peek at some of the coverage areas where Denée will be able to help Forrester clients with consumer payment strategy in the new year:

Defining the future of consumer payments
Managing a portfolio of payment products (e.g. credit, debit, prepaid, contactless, mobile, person-to-person (P2P), etc.)
The business models and profitability of these payment systems
Understanding the dynamics of customer (consumer and merchant) payment behavior
Understanding the payments needs of different markets
Sizing the different payments market opportunities
Driving customer (consumer and merchant) adoption of payments systems
Building and developing new payment systems
Optimizing existing payment products to improve security and increase convenience

Denée joins us from American Express, where she has held several senior-level positions spanning product development, mobile strategy, and digital strategy for payment products and member rewards over the past seven years. Her 20-year career also spans management consulting and senior marketing roles for major consumer brands like Starbucks and AT&T.

Beyond Tablets: The Next Five Computing Form Factors

Sarah Rotman Epps — Mon, 12 Dec 2011 14:49:39 +0000

With CES 2012 a month away, it's a good time to look ahead at what's next for consumer technology product strategy. All eyes have been on tablets: Apple sold 40 million iPads in just 18 months, with 11 million sold in this past quarter alone. With the Kindle Fire and Barnes & Noble Nook Tablet finding their own successful markets, it's easy to see why tablets attract so much attention and excitement. But computing evolution doesn't end here--tablets, while still growing rapidly, are not the final form factor. We've identified these five form factors as the best candidates for what comes next, which we describe in more detail in a new report for clients:

Introducing Engaged TV: Xbox 360 Leads The Way To A New Video Product Experience

James McQuivey — Mon, 05 Dec 2011 03:00:00 +0000

What to do when a failed product concept still lingers, haunting every attempt at injecting it with new life? That's the problem with interactive TV, a term that grates like the name of an old girlfriend, conjuring up hopes long since unfulfilled yet still surprisingly fresh. Gratefully, it's time to put old product notions of interactive TV behind us because this week Microsoft will release a user experience update to the Xbox 360 that will do for the TV what decades of promises and industry joint ventures have never managed to pull off.

Meet engaged TV. From now on, I will no longer need to plead with the audiences I address, the clients I meet, or my friends who still listen to me to imagine the future of TV. Because Microsoft has just built and delivered it: A single box that ties together all the content you want, made easily accessible through a universal, natural, voice-directed search. This is now the benchmark against which all other living-room initiatives should be compared, from cable or satellite set top boxes to Apple's widely rumored TV to the 3.0 version of Google TV that Google will have to start programming as soon as they see this. With more than 57 million people worldwide already sitting on a box that's about to be upgraded for free - and with what I estimate to be 15 million Kinect cameras in some of those homes - Microsoft has not only built the right experience, it has ensured that it will spread quickly and with devastating effect.

Microsoft's Shrinking Window For Tablets: Its Fifth-Mover Product Strategy Is Late

JP Gownder — Tue, 29 Nov 2011 13:32:28 +0000

Forrester is bullish on Windows 8 as a product for consumers. With Windows 8, Microsoft is adapting Windows in key ways that make it better suited to compete in the post-PC era, including a touch-first UI, an app marketplace, and the ability to run natively on SoC/ARM processors. This pivot in product strategy and product design makes sense as we move deeper into an era when computing form factors reach far beyond traditional desktops and laptops.

But in a new report, Sarah Rotman Epps and I look at Windows 8 tablets, specifically, through our product strategy lens. What do we see? On tablets, Windows 8 is going to be very late to the party. Product strategists often look to be "fast followers" in their product markets. Perhaps the most famous example is the original browser war of the 1990s: Microsoft's fast-following Internet Explorer drove incumbent Netscape out of the market altogether.

For tablets, though, Windows really isn't a fast follower. Rather it's (at best) a fifth-mover after iPad, Android tablets like the Samsung Galaxy Tab, HP's now-defunct webOS tablet, and the BlackBerry PlayBook tablet. While Windows' product strategists can learn from these products, other players have come a long way in executing and refining their products -- Apple, Samsung, and others have already launched second-generation products and will likely be into their third generation by the time Windows 8 launches.

The Nook Boutique: How Channel Matters To Product Strategists

JP Gownder — Mon, 28 Nov 2011 15:11:19 +0000

The link between product strategy and channel is often overlooked, but strong: In our most recent survey of product strategy professionals, 33% say that they, personally, define the channel strategy for the products they sell. In other organizations, product strategists must work with more specialized channel strategists. Either way, channel is a determinant of success in any product strategy.

In the consumer electronics industry - and more specifically, the rapidly changing tablet market - channel presents a major challenge to product strategists. Most product strategists sell their tablets at Best Buy, a retailer that receives high foot traffic from engaged buyers, but which contains a lot of competing models. It's easy for any individual tablet product to get lost at Best Buy, particularly when the retailer is offering plenty of Android tablets with limited meaningful differentiation among them. Buying end caps (which are expensive, if differentiating) can help, but it's not always clear that the Blue Shirts can explain every tablet's value equally.

Apple has this quandary beaten: Its Apple Stores form the core of its retail channel, and after a product like the iPad has been popularized, Apple also sells via mass-market retailers like Wal-Mart and Target. Competitors haven't been able to match Apple's winning formula, though Microsoft is starting to roll out its own stores.

Barnes & Noble offers the most interesting test case: As Sarah Rotman Epps has written, the brick-and-mortar stores play a very central role in the product strategy of the Nook Tablet. The new Nook Boutique has finally launched (see photo below); how is it stacking up?

So far, it's a great start. It's a fairly radical change, if you think about it - turning bookstores into consumer electronics stores. Based on my visit to a single Nook Boutique (in Framingham, MA), I found:

Christmas 2011: The First Mass Customized Holiday Season

JP Gownder — Sat, 26 Nov 2011 21:49:44 +0000

Ah, Black Friday: What would the post-Thanksgiving shopping bonanza be without a visit to the local mall? This year, I was keen to perform some gumshoe research on a theme I've been talking about all year long: mass customization, a product strategy that's ready for prime time across multiple industries.

A trip to the Natick Mall (yes, "Mall," no longer "Collection," New Englanders) reveals that mass customization isn't just the future; it's the present. In fact, it's hiding in plain sight. Build-a-Bear Workshop, Hallmark, Lego, and LensCrafters are all stores in the Natick Mall that offer significant customization for consumer products. Burberry is the latest Natick Mall vendor to offer mass customization; I am quoted in Time magazine this week (here, but subscription required to view the link; page 82 in the December 5 paper edition) discussing how luxury clothing and customization fit together well. As I've written before, one of the benefits of employing mass customization is that it empowers consumers to create products that express their personalities -- a particularly relevant feature for clothing and apparel products.

Welcome To The Nook Signing

JP Gownder — Mon, 14 Nov 2011 19:34:18 +0000

It's a tried-and-true in-store promotional tactic: the book signing. Authors tour bookstores, meet their fans, and sign copies of a book that was bought in the store that day.

How can book signings be updated for the 21^st century? Barnes and Noble, with its Nook devices and its rapidly expanding Nook Boutiques, has an opportunity to create a total product experience around its Nook devices and digital books. Let's call it a Nook Signing, a theoretical Forrester product idea for Barnes and Noble to consider.

Leveraging its in-store Wi-Fi, Barnes and Noble could host a series of Nook Signing events - special book signing events only for owners of Nook devices (or those willing to buy them in store that day).

The event would feature marquee bestselling authors like George RR Martin or other authors with vociferous, loyal fans. (Barnes and Noble would have to incentivize these authors).

Attendees would get to meet the author, but more importantly, would receive an in-store download over Barnes and Noble's Wi-Fi, receiving unique, brand-new content on their Nooks. For example, Nook Tablet and Nook color devices could receive a video from George R.R. Martin offering up an exclusive tidbit about his next book.

What happens next? Nook Signing attendees use their Facebook, Twitter, and other social media accounts to tell the world the news about George R.R. Martin's next book ... which they learned about at the Nook Signing.

What does this event accomplish?

Product Strategists At Telcos Shouldn't Obsess About "Bit Pipe Syndrome"

Thomas Husson — Thu, 10 Nov 2011 09:10:35 +0000

Product strategists in various industries tend to dismiss telcos' role in service innovation, focusing instead on disruptors such as Google and Apple. It is true that new entrants and over-the-top (OTT) players have bypassed carriers, reducing their role to providing bit pipes.

Product strategists at telcos are suffering from what we are calling "bit pipe syndrome." Didier Lombard, the former CEO of France Telecom, summed this up well when he declared back in 2007, "I am not building freeways for Californian cars."

Since then, many observers have claimed that telcos will die if they do not reinvent their business models, leveraging their networks as a service. This case is overstated: Reports of operators' deaths are exaggerated.

No doubt telcos are increasingly being commoditized to the point that they will become utilities, but there is no shame in monetizing networks -- carriers' bread and butter for a few more years. Fundamental connectivity remains a valuable service -- all the more if product strategists focus on gaining more pricing power and delivering more segmented offerings, either on their own or with new strategic partners.

When it comes to product innovation, operators still have key assets to leverage -- particularly their billing capabilities -- to become trusted partners for consumers and third parties. Some global carriers have a strong presence in emerging countries, and they will have more sway in shaping the types of content services that the world consumes.

Product strategists at operators have the assets to continue to differentiate their offerings and innovate in a disrupted telecom ecosystem. I am not saying this is not challenging and extremely difficult, but here are some approaches that could work:

Consumer Product Strategy

2012 Mobile Trends And What They Mean For Product Strategists

Categories:

Book Business Outlook For 2012: Hard Work Ahead

Apple Schools Textbook Publishers In Education Innovation

Categories:

CES 2012 Preview: Tablets, Ultrabooks, And Wearables

Categories:

Potential Nook Spinoff: Unlocking Value But At What Cost?

Categories:

Co-Creating Value At Disney World

Product Strategists Should See NFC As Much More Than Contactless Payments

Categories:

Forrester's CPS Practice Welcomes Our Newest Analyst - Denée Carrington!

Categories:

Beyond Tablets: The Next Five Computing Form Factors

Categories:

Introducing Engaged TV: Xbox 360 Leads The Way To A New Video Product Experience

Categories:

Microsoft's Shrinking Window For Tablets: Its Fifth-Mover Product Strategy Is Late

Categories:

The Nook Boutique: How Channel Matters To Product Strategists

Christmas 2011: The First Mass Customized Holiday Season

Categories:

Welcome To The Nook Signing

Categories:

Product Strategists At Telcos Shouldn't Obsess About "Bit Pipe Syndrome"

Categories: