Live @ IBM InterConnect 2012: Marie Wieck On Business In Motion

Marie Wieck is general manager of IBM’s Application & Integration Middleware (AIM) business unit, where she leads an organization of more than 7,500 software development, marketing, services, and sales professionals. She is responsible for IBM’s WebSphere software portfolio and other strategic middleware products, including Web application servers, transaction and messaging systems, integration, and business process management solutions.

Marie Wieck is the general manager of IBM’s Application and Integration Middleware organization (home of IBM’s distinguished market-leading WebSphere brand), and has held a variety of technical and executive roles across our software, services, and finance groups.

In her current role, Marie leads an organization of more than 7,500 software development, marketing, sales, and services professionals. There, she is responsible for IBM’s WebSphere software portfolio and other strategic middleware products, including Web application servers, transaction and messaging systems, integration, and business process management solutions.

During our sitdown at IBM InterConnect, Marie shared some of the proceedings from her two “Hot Topic” sessions in Singapore, one on the Mobile Enterprise, and the other on Business Process management.

Marie also expanded on IBM’s emerging “mobile enterprise” strategy, explaining that rather than see mobile as another blip on the technology evolutionary radar screen, that rather it’s an opportunity to be transformative across the enterprise.

From fomenting front-line employee’s opportunity to be more collaborative in the field, to enabling back-office overlords to use their smartphones to watch over and manage business process management processes, IBM is working to bridge systems of record and of data together with employees and external constituents in a much more transformative story than has been communicated to date.

It’s an exciting narrative, and as Marie conveyed in the interview, mobile is touching the entire IBM portfolio.

Did You Hear THAT Pin Drop?

The Raspberry Pi just got an upgrade, with the $35, credit-card sized computer adored by geeks everywhere recently obtaining an upgrade to 512MB RAM, double that what it used to offer at the same price. With this upgrade, the latest Pi can now handle multimedia, high memory and mobile applications. This should also enable the tiny computer to run a future version of an Android 4.0 OS.

Whew.

That’s all I have to say after the brutal 30+ hour journey back home from Singapore.

Jet travel = one big giant petri dish, and after I took ill during the first leg of my trip from Singapore to Tokyo, my sinuses took it upon themselves to become completely inflamed and congested, so I learned yet another helpful travel trick: Pack sinus spray in the carry on at all times.

Fortunately, my head never got to the point that it exploded mid-flight, and I was sentient enough when I landed in Austin to be able to drive home. Where I promptly slept for 10 hours.

The weekend in sport was just as daunting: My UT Longhorns got on the wrong side of the Sooners in the Red River Showdown, my Cowboy’s QB doesn’t know how to count in seconds at the end of a football game, and my New York Yankees lost their beloved captain Derek Jeter in an ankle-wrenching, season-ending heartbreaker, now heading to Detroit down 0-2 to the Tigers in the ALCS.

And then, to awaken today bright and early and discover more potential consolidation in the telecommunications space, this time with SoftBank’s 70% stake its buying in Sprint, which amounted to a $20B U.S. stake!

TechCrunch reported the news brought down the Sprint website overnight.

As has been widely reported, Sprint is well behind in the LTE game, and the SoftBank infusion is expected to help Sprint with their continued rollout of the new network technology, as well as consolidate their position in wi-fi broadband provider, Clearwire.

Faster, cheaper, better. Isn’t that (almost) always the objective in the technology game?

Speaking of, if you’re made in the spirit of a tried and true “Maker Fairean,” DIYer, the new Raspberry Pi is now shipping with double the RAM (512MB!) at the same tiny price tag of $35.

The Raspberry Pi is a credit-card sized computer that runs several variants of Linux and is primed for attraction to emerging growth market countries looking to move into the computing realm at a ridiculously affordable price.

And if that news is music to your geekish ears, also on the Monday morning news run down is Microsoft’s announcement it’s moving into the digital music game, using its X-Box as a music streaming Trojan Horse.

The Xbox Music service will be available through the Xbox Live service, and on Windows 8 tablets, PCs, and Windows mobile phone devices, and will include free and paid models for streaming AND downloads.

While you’re at it, how about delivery of a patch that keeps the  “blue screen of death” from ever darkening my virtual door again?!

Okay, that’s enough silly news banter for the moment.

I have to get back to work — Information On Demand 2012 is less than 7 days away (more on that shortly!). In the meantime, stay tuned for more interviews conducted last week at IBM InterConnect 2012.

News To Go…And Lots Of It

Half of all U.S. adults now have a mobile connection to the web through either a smartphone or tablet, significantly more than a year ago, which has major implications for how news will be consumed and paid for, according to a detailed new survey of news use on mobile devices by the Pew Research Center’s Project for Excellence in Journalism (PEJ) in collaboration with The Economist Group.

So how do you prefer to consume your news on your mobile device?

A new study from the Pew Research Center’s Project for Excellence in Journalism indicates that half of all U.S. adults now have a mobile connection to the web through either a smartphone or tablet, which is much higher than even a year ago.

Pew alleges this has “major implications for how news will be consumed and paid for.”

Agreed.

But we’re also seeing that users are moving from “snacking” on news via their mobile devices, to reading much longer form content.

And moreover, more people are moving towards using a browser and away from using an app for their tablet news consumption.

I found this one to be quite interesting, as it’s somewhat opposite from my own behavior.

For example, I’ve been a long-time New York Times reader, mainly via their Website (on my Mac), and sometimes via my iPad or iPhone 4.

I finally decided to give them some of my hard-earned money, recently signing up for an all-digital subscription. I don’t want no dead tree showing up on my doorstep!

I strongly prefer the New York Times app, particularly on the iPad. Call me old-fashioned, but being someone with a journalism background myself, I place great value on design, layout, and yes, usability.

So, I save the browser version for the desktop, but much prefer the app on my mobile devices.

Going against the trend, as always!

Some other highlights from the study:

• Lower cost tablets in late 2011 brought in a new group of tablet owners.
• There’s growing evidence mobile devices are adding to how much news people get.
• People who get news throughout the day on their mobile devices are more engaged news consumers.
• People notice ads on mobile devices and may be even more likely to click on them than they are to click on other digital ads.

From their lips to Mark Zuckerberg’s ears!

You can read more about new Pew report on mobile news usage here.

Blogger’s Note: If you’re a tried and true news junkie, then you have to check out the Magnolia Pictures documentary release “Page One: Inside the New York Times.”  The filmmakers take you inside the Times newsroom and the inner workings of the Media Desk, just as the Internet started to surpass print as our main news source and as newspapers all over the U.S. started  going bankrupt.  Page One chronicles the transformation of the media industry at its time of greatest turmoil. The best part: It features lots of coverage of media columnist and technology curmudgeon, David Carr.

In Search Of The Mobile Enterprise

The new mobile business model — with anytime, anywhere transactions and a blurring of lines between corporate and individual — can make your IT organization feel like it has lost control. For all the good that comes with mobilizing your workforce, there are challenges: maintaining security and compliance, managing multiple device platforms and addressing complex mobile requirements.

You can’t throw a rock these days without hitting a new smartphone or tablet device.

Last week, it was the iPhone 5 and the new Kindle Fire HD. Tomorrow, HTC’s expected to introduce some new mobile products.

And Apple still has yet to introduce the Apple “mini” iPad, currently expected in October.

The move to mobile computing raises some intriguing questions about the nature of work. What is it? Where does it take place?

As someone who’s worked their entire career at IBM, I can certainly attest to the idea that here, increasingly, work is not a place you go but what you do.

I’ve spent nearly nine full years working from my home, and several of those years, spent at least a week a month living (and working) in airplanes.

As the IBM “Services for the Mobile Enterprise” team recently observed, the new workplace is now undeniably a mobile enterprise.

CIOs On Mobile: 66% Plan To Increase Mobile Investments in 2012

Which makes it no big surprise that 66 percent of CIOs plan to increase investments in mobile services in the next year.

And of course, there’s the “BYOD” movement to contend with (“Bring Your Own Device”), with employees expecting whatever device they have to fit into their corporate environment.

This new mobile business model, with anytime, anywhere transactions and a blurring of lines between corporations and individuals, can send IT folks into a conniption fit.

Despite all the goodness — for employees, management, and most importantly, the bottom line — there are challenges that accompany this mobilization of the workforce.

Issues such as maintaining security and compliance.  Managing multiple device platforms.  Addressing complex mobile requirements.

IBM recently released this interactive infographic that has some interesting statistics I thought worthwhile sharing here.

To start, 35 percent of the world’s total workforce is expected to be mobile by 2013.

Here in the U.S., up to 72.2 percent of workers are already plugged in remotely.

This year, some 43 billion mobile applications are expected to be downloaded.

And yet on average, mobile workers spend only a total of 28 minutes a day on technology distractions…there’s too much work to do, otherwise!

The Mobile Upside: 240 Extra Hours Worked Per Worker Per Year

And here’s the upside bonus for you managers: Such mobile workers work an average of 240 extra hours per year.

But as the infographic observes, with those benefits come expectations.

This new mobile generation of workers demands flexibility. Today’s employees expect to use their own devices and applications at work to access information and social networks at will. They even value this flexibility more than a higher-paying salary (Can you say “Mobile enables work/life balance?”).

Cisco’s Connected World Technology Report in 2011 found that 66 percent of workers said they would take a job with less pay and more flexibility in device usage, access to social media, and mobility than a higher-paying job without such flexibility.

Mobile Presents New Challenges

So, as businesses work to embrace these new productive mobile work habits, they must also face the requisite challenges asscoated with the growing number of devices, networks, and applications. Enterprises need a solution that intertwines cross-platform compatibility, security, cost management, compliance, and the inevitable complexity.

By way of example, 21 percent of mobile workers say they have experienced a security issue related to their smartphone (lost, stolen, hacked, virus) in the last year alone.

Fifty-four percent of enterprises rate security and authentication as one of the two top concerns for their mobile environments.

Seventeen percent say they need to meet compliance/regulatory requirements in mobile environments.

And yet 45 percent of IT departments say they aren’t prepared policy- and technology-wise to handle this more borderless, mobile workforce.

Bridging Your Mobile Gap

To overcome those challenges, enterprises need an experienced partner with a strategy capable of spanning the distance between mobile advances and existing infrastructures.

Those early adopters are leaping ahead: They’re already experiencing 20 percent cost savings and productivity improvements.

And 75 percent of CIOs say mobility solutions are a top priority of theirs for 2012.

On the mobile front, IBM workers are walking their own mobile talk, connecting to 10 different networks located around the world, and with 100K+ of them connecting using their own handheld devices (using at least five supported device platforms).

IBM’s own app store, Whirlwind, offers over 500 applications and was recognized by CIO Magazine with the “CIO 100 Top Innovation Award.”

All of that experience IBM has had with its own mobile enablement has informed and shaped the company’s customer-facing mobile initiatives, both through product development and through the introduction of its mobile services offerings.

IBM can help your staff develop the right strategy and governance and deliver a wide range of mobile enterprise services to create a more productive, connected workplace.

You can read about some of those offerings here.

Waiting For The New iPhone 5?

So tomorrow’s the day.

We find out what the Apple iPhone 5 is all about.

Before we discover what the details behind the new Apple smartphone are, I thought it might be interesting to provide a quick glimpse at the state of the mobile marketplace here in the U.S.

I unearthed a blog post from TechCrunch from September 4th, citing the “latest data” from comScore that suggests Apple’s smartphone market share has grown to just over 33 percent, up 2 percent since April of this year.

That study surveyed over 30,000 U.S. mobile phone subscribers, which revealed that Google’s Android continues to keep the pace, holding 52 percent share, a 1.4 percent increase since April.

RIM, the maker of the BlackBerry, decline some 2.1 percent, down from 11.6 percent to 9.5 percent.

Microsoft’s Windows Mobile platform also saw a 0.4 percent decline in the same data, dropping from 4.0 percent to 3.6 percent.

And Symbian brings up the rear, down 0.5 percent, from 1.3 percent to 0.8 percent.

Despite the recent patent verdict, device maker Samsung is holding steady for smartphone device share at 25.6 percent in the latest period while Apple stood at 16.3 percent.

So what does Apple’s introduction of the iPhone 5 portend for the device market?

AppleInsider’s Neil Hughes wrote earlier today that the new iPhone will have “major implications throughout the personal electronics markets,” suggesting that existing LTE smartphones will come to be seen as “bulky and subpar” while stealing share not only from other smartphone makers, but also from PC makers like Dell and HP.

Hughes also cites J.P. Morgan analyst Mark Moskovitz in suggesting that the iPhone 5 “will offer better battery performance in a smaller form factor.”

In finding its way to new customers, Apple is also moving away from existing GPS service providers, and will instead transition to the new Maps application for iOS 6.

But will extended battery life and an Apple-owned GPS service be enough to lure loyal iPhone users to the new device, never mind Android loyalists happy with their current devices?

The answer to that question probably lies more in the emergence of new cloud and application offerings than the device characteristics themselves.

More interesting to me this past week, for example, was the report from The Wall Street Journal that Apple was looking to build its own streaming radio service, a move that seems to have helped drive Pandora’s share price down from a recent $12 high to just under $10.

Or consider the expectation Apple will introduce further synchronization between its iCloud offerings into the iOS mobile sphere, apps like Reminders, Notes, Mail, Calendar, and a new “Lost Mode,” which helps itinerant iPhone users find their lost phones.

I know I’ve found that Web-based services like Evernote and Remember the Milk, which synch across multiple devices and/or computers, provide much more utility than those dependent upon a single platform or device.

Whatever the details of the iPhone 5, the world will be watching closely, but my recommendation as one who’s used smartphones across the range of top competitors, including Apple, Android, and RIM, is to look beyond the device and underneath that larger intersection of IP-based services which transcend platform and help unearth the riches of true and unbound universal computing.

Pay As You Go

Thus far, this has been a pretty “mobilized” summer, with news breaking every day about the increasingly important role mobile computing is playing in our business and personal lives.

Today, we heard about the new Samsung Galaxy 10.1 tablet (even Walt Mossberg kinda likes it!), and TechMeme has early screenshots and guestimates about what the newer, smaller iPad’s going to look like.

But devices aren’t the whole picture. Infrastructure, application lifecycle management, security and privacy, and other related issues are key to mobile success. And, until these devices are enabled with an easier payment capability, money will be left on the table.

Lots of it.

Ironically, it’s been Apple that has been the closest to providing such a system thus far, with their Apple ID linkage to our credit cards.  But that’s just for the stuff I buy from Apple…what about everybody else?

So today, the Wall Street Journal’s Robin Sidel explained that more than a dozen big merchants are expecting to announce their plans to develop a mobile-payments network that would go up against the likes of Google.

Called the “Merchant Customer Exchange,” the new venture is being led by Wal-Mart, Target, 7-Eleven Inc., and Sunoco, and will attempt to find its way to a more standarized mobile payment system.

Though this may move may be an intended counter to Google’s Wallet capability on the Android platform, Sidel’s story reminds us we also have another joint venture called Isis, led by a number of telcos, as well as the recent $25 million investment by Starbucks in mobile payment start-up Square, also in the running.

And of course, let’s not forget some of those other existing systems which have millions of credit card accounts, including Amazon, whose 1-Click payment capability stands apart, and PayPal, with their unique person-to-person payments capability.

In this emerging roulette wheel of mobile payments, I’m not quite sure where I’d place my bets just yet, as the wheel’s just getting going.

But there’s a lot at stake.

I just attended comScore’s quarterly webcast on the “State of the U.S. Online Retail Economy.” For the second quarter of this year, nearly one in ten of all e-commerce dollars spent were done so via a mobile or tablet device.

Moreover, nearly two in five tablet owners have purchased something online via their device in the past month (a number more than double of that of smartphone owners).

One wonders if that smartphone purchasing number might not be a few percentage points higher were it easier to hand over one’s payment information via smartphone handsets.

Looking at the bigger picture for a moment, comScore also reported in the webcast that the channel shift to online appears to be accelerating, with online sales overall up 15 percent for the quarter, while on a comparable category basis, offline sales only increased two percent.

At the forthcoming IBM Smarter Commerce Global Summit in Orlando (see this post for more details), IBM has some 20+ sessions that contain a mobile component, including one entitled “Mobile Payments, An IBM POV” (IB-3440).

That event will be held September 5-7 at the Walt Disney Swan and Dolphin Resort in Orlando, Florida, and you can learn more about it here.

IBM And Mobily: Spoken Like A True, Modern Mobile Network

IBM’s mobile computing juggernaut continues with a new deal just announced in Saudia Arabia.

Etihad Etisalat (Mobily) and IBM announced today a 5-year agreement worth approximately $280 million to provide comprehensive IT solutions for the Saudi Arabian company.

Saudi Arabia: 870,000 Square Miles

Riyadh is the capital and largest city of Saudi Arabia. It is also the capital of Riyadh Province, and belongs to the historical regions of Najd and Al-Yamama (Source: Wikipedia) IBM and Mobily, the Saudi Arabian telecommunications firm, will collaborate on future innovation with the help of IBM Research, using IBM’s Spoken Web solution. The basic principle of Spoken Web uses speech to create voice sites using the mobile phone network to establish a spoken version of the internet. The opportunity to collaborate with leading IBM researchers has become a key differentiator for IBM.

Saudi Arabia is a big place, encompassing some 870,000 square miles with a population approaching 30 million people.  Mobily, as the fastest growing telecommunications company in Saudia Arabia, has experienced an explosion in demand from the growing number of subscribers using mobile devices, and so in turn needed to boost its IT capacity and innovation in the market.

This new agreement with IBM will provide Mobily with faster, targeted access to new technologies and expertise so it can build a strong infrastructure to keep up with the company’s business growth.

As Mobily gears up for further expansion, it wanted to improve the quality and speed of its operations using IBM best practices.

As part of the agreement, Mobily and IBM will collaborate on future innovation with the help of IBM Research, for example, using IBM’s Spoken Web solution.

The basic principle of Spoken Web uses speech to create voice sites using the mobile phone network to establish a spoken version of the internet. The opportunity to collaborate with leading IBM researchers has become a key differentiator for IBM.

IBM’s Growth Market Strategy

The agreement highlights IBM’s continued geographic expansion initiative to strategically increase its presence in key growth markets like Saudi Arabia in support of its global growth strategy.

IBM is ramping up its investment across the Middle East and Africa, harnessing the company’s Smarter Planet initiative to help both public and private sector clients do more with fewer resources.

The strategic management of IT remains with Mobily, ensuring continuation of its standards of excellence and cutting-edge architecture, and enabling Mobily to meet the explosion in demand it is seeing from the growing number of subscribers using mobile devices.

“Partnering with one of the largest technology companies in the world offers Mobily a broad portfolio of modern IT solutions that will have a positive impact on our customers in terms of the quality of products and innovative services, in addition to solutions that will enrich their lives. We are pleased to sign with IBM, which has a significant presence in this strategic sector,” said Khalid Al Kaf, CEO, Mobily.

“The agreement is part of our efforts and vision of transforming Mobily into an integrated telecommunications operator. It also supports the Saudi government’s initiative of creating a knowledge-based community, adopting state of the art services and solutions” Al Kaf added.

IBM And Saudi Arabia: Remaking The Kingdom’s Future

IBM is involved in a range of key initiatives in Saudi Arabia, including a joint project with King Abdulaziz City for Science and Technology using innovative membrane technology and solar power to address the shortage of drinking water.

In another project, King Abdullah University of Science and Technology (KAUST) and IBM are collaborating using the most complex, high performance computing system in the region.

The agreement with Mobily was signed in August 2012.

REAL Coupons

Anybody watch the opening ceremony of the Olympic Games from London?

I don’t know about you, but I rather enjoyed them, in a British humor sort of way.

The testament to the National Health Service was a bit out of left field, but Danny Boyles made even that fun.

As for the image of the Queen skydiving with James Bond (aka Daniel Craig) into Olympic Stadium…well, cue the Bond theme, and shake up a martini, please, Miss Moneypenny, as that was a surprise indeed!

Across the English Channel and a bit further east, IBM recently partnered with major German retail hypermarket chain, REAL, to bring about its own recent surprise.

IBM and REAL have partnered to launch a new electronic coupon system throughout REAL’s 320 German stores, a first-of-its-kind digital coupon system developed with IBM Research to enable consumers to use their mobile phones to find and redeem e-coupons as they shop in stores.

This new capability delivers a convenient and personalized service to shoppers, even if they forgot their paper coupons back at home.

The REAL Deal

REAL hypermarkets sell about 80,000 different items, from food to electrical appliances to clothing, and already were conducting the largest coupon program in Germany through the company’s “Payback” program.

In fact, REAL cites customer loyalty programs like Payback as an important part of their business strategy in the highly competitive German retail market.

The REAL coupon program enables in-store Payback members to use their mobile phones to browse online coupons as they walk through the aisles. Shoppers can choose their favorite coupons from the REAL homepage or a Payback app on their smartphones.

In a maximum of 500 milliseconds, the system confirms their choice and transfers an eCoupon to the store’s “3V – Value Voucher Validation” coupon system in real time.

To redeem the eCoupon, customers then display their Payback membership card upon check-out and the transaction is automatically processed.

Consumer Checkout

For REAL, this new electronic system offers a more personalized view of customers and the option to change coupon distribution in real time. Promotions can respond more flexibly to seasonal changes or fashion fads to appeal to ever-changing consumer tastes.

“In essence, we are simplifying and improving the coupon redemption process,” explained Bernd Hasenbank, Head of Point of Sale Solutions at REAL.

REAL expects that it will be receiving several hundred thousand eCoupon queries and eCoupon redemptions per day at the cash registers of it 320 stores. That is not an easy task for the underlying information technology (IT) architecture with a central server.

The new 3V coupon system at REAL is based on existing IBM solutions at METRO Group, which are compliant with the EPC Information Services Standard (EPCIS) of EPCglobal. The system is based on IBM InfoSphere Traceability Server, a high-performance data storage device, that is able to manage and analyze large amounts of data, integrate master data systems and provide data in real-time for internal and external applications.

If you’d like to learn more about IBM Smarter Commerce solutions, go here, and don’t forget the upcoming Smarter Commerce Summit to be held in Orlando, Florida, September 5-7. You can learn more about and register for that event here.

IBM Retail Online Index: Mobile Up, Social Down

If you’ve been following the mobile and social space, and especially if you own your own smartphone, you know the impact that that increased mobility means in terms of your ability to conduct business –- personal and professional –- while on the go.

Now, IBM has some empirical data that indicates those behavioral changes due to smartphone adoption are occurring on a more massive scale.

The IBM Retail Online Index, a cloud-based analysis of the online retail sector, integrates factual marketplace data from its analytics offerings, including the Benchmark, with insights from the IBM Social Sentiment Index, an advanced analytics and natural language processing tool that analyzes large volumes of social media data to assess public opinions.

The combination of these two offerings provides the most accurate and immediate snap shot on the state of the online retail market.

According to the latest IBM Retail Online report, mobile shopping rose while social media sales fell, providing an indication of where US retailers may invest in order to capture the attention and loyalty of the digital consumer. The IBM Retail Online Index reported that retailers experienced 15 percent growth in sales from mobile devices but saw a 20 percent decline in sales traced to social media based on a much smaller base over this three-month period.

This report follows today’s news from the U.S. Department of Commerce’s Census Bureau which announced its estimates of U.S. retail and food services sales. According to the findings, retail sales fell 0.5 percent in June from May, the third straight month sales have been down from the month before. On a positive note, June 2012 sales were 3.8 percent above the pace of June 2011.

IBM’s Retail Online Index: Mobile Commerce Now 15% Of All Online Purchases

IBM’s Retail Online Index identified several trends of importance to chief marketing officers (CMO), e-commerce leaders and customer service professionals. Over the second quarter consumers continued to embrace mobile devices as a shopping tool, with mobile commerce accounting for 15.1 percent of all online purchases, an increase of more than 14 percent. Despite this momentum retailers are still struggling to sustain substantial success with their social media efforts, evidenced by a more than 20 percent drop in social shopping. 

According to IBM’s State of Marketing 2012 survey, one explanation for social commerce’s failure may be the absence of a CMO and CIO alliance which is critical as marketing and online commerce become increasingly technology-driven. The lack of this alliance hinders the deployment of integrated technologies capable of fueling effective social media efforts.

A second factor is marketing’s inability to form a clear consensus on how to utilize social channels. As a result, the retail online index saw a decline in positive sentiment around social media, which according to the online index dropped from 25.1 percent in Q1 to 18.6 percent in Q2. Leading factors for this shift were the lack of deals being offered by retailers through these channels, which were more prevalent in Q1.

More Shoppers Are Multi-Channel, Mobile And Social

“Shoppers today are shifting from a singular online approach to a multi-channel experience that includes both mobile and social media. As a result, retailers must be prepared to connect with their customers on all fronts, or lose them to the competition,” said Craig Hayman, General Manager, IBM Industry Solutions. “As we enter the home stretch for the 2012 holiday season, we will continue to watch how CMOs and CIOs tackle these challenges and create social media efforts that deliver value to the customer while driving revenue for the business.”

Over the second quarter, while online traffic and sales for Q2 were down 6.7 percent and 2.3 percent from Q1 respectively, there were signs of optimism. Specifically, for completed orders, shoppers bought more items (average items per order grew 2.6 percent) and spent more for each transaction (average order values for each purchase grew by 2.3 percent) over the second quarter.

Part of IBM’s Smarter Commerce initiative, the Retail Online Index draws data and insights from IBM’s big data offerings to provide the industry’s most comprehensive look into the pulse of online retail through traditional and social media channels. The index analysis for second-quarter 2012 reveals the following trends:

Online Retail Sales for Q2 2012 versus Q1 2012:

• Consumer Spending: Total online sales for the quarter were down 2.3 percent over Q1 2012.
• Average Order Value: The average value for each order in Q2 grew by 2.3 percent.
• Items Per Order: The average number of items per order increased by 2.6 percent.
• Page view Per Session: Page views per session dropped by 2 percent to 6.4 pages.
• Mobile Sales: Sales from mobile devices reached 15.1 percent, up from the 13.3 percent in Q1 2012.
• Mobile Devices: While Apple’s iPhone continued to rank one for mobile device retail traffic at 8.2 percent, Android surpassed the iPad which finished at 6.8 percent and 6.7 percent respectively.
• Social Traffic: Shoppers referred from social networks generated 1.3 percent of all online traffic over Q2 2012, a slight increase from the 1.1 percent seen the previous quarter.
• Social Sales: Shoppers referred to retailer sites from social networks generated 1.9 percent of all online sales over Q2 2012, a decrease from the 2.4 percent seen in Q1.

Online Retail Categories for Q2 2012 versus Q1 2012:

• Consumers further intensified their focus on the home with home goods sales growing by 35.3 percent in Q2.
• Department stores continued to catch the attention of consumers with sales growing 3.7 percent
• Jewelry stores maintained its upward track with sales growing by 1.4 percent.

Consumer Sentiment for Department Stores for Q2 2012 versus Q1 2012 based on the IBM Social Sentiment Index:

• Social Media: A potential result of retailers failing to deliver compelling campaigns through these channels, positive sentiment around social media dropped by 6.5 percentage points, from 25.1 percent in Q1 to 18.6 percent in Q2.
• Loyalty and Pricing: Where sales and clearing inventory were priorities in Q1, retailer prices returned to more normal rates in Q2, a shift that fueled negative sentiment around pricing which grew by 2.1 percentage points. These factors also impacted consumer loyalty where negative sentiment grew by 2.1 percentage points.

 

About IBM Smarter Commerce

IBM’s Smarter Commerce initiative delivers software and services to help companies transform their business processes to more quickly respond to shifting customer demands in today’s digitally transformed marketplace. The initiative is driven by the demands from organizations who are increasingly looking for ways to bring new levels of automation to marketing, sales and fulfillment to secure greater customer loyalty. The growth of mobile, social and online commerce are key trends within Smarter Commerce.

You can learn more about IBM’s Smarter Commerce initiative here.

Shopping For That MobileBeat

Remember “Minority Report?” That scene where Tom Cruise was walking by the billboard, and the billboard “recognized” him through some kind of biometrics (I think it was an eye scan?) and then started to target ads to him?

Well, IBM is doing something really cool and not even like that, but I had to make sure I got your attention so you’d keep reading.

In our case, IBM Research has created a new augmented reality application that gives in-store shoppers instant product details and promotions, all in the palm of their hand.

Here’s how it works: Upon entering a store, consumers download the app on their smart phone or tablet, register, and create a profile of features that matter to them — from product ingredients that could trigger an allergy, to whether packaging is biodegradable.

When they then point their device’s video camera at merchandise, the app will instantly recognize products and, via augmented reality technology, overlay digital details over the images — such as ingredients, price, reviews and discounts that apply that day.

Talk about an educated, empowered consumer!

And, if consumers opt in (their choice!), information from their social networks can be integrated into the information stream. For instance, if a friend had reviewed or made a comment about a product they’re looking at, they’ll see it.

Using IBM’s prototype app, shoppers looking for breakfast cereal could specify they want a brand low in sugar, highly rated by consumers – and on sale.

As a shopper pans the mobile device’s camera across a shelf of cereal boxes, the augmented shopping app reveals which cereals meet the criteria and provides a same-day coupon to entice consumers to make a purchase.

The app, being developed by IBM’s Research lab in Haifa, Israel, addresses the fundamental gap between the wealth of readily available product details on the Web that in-store shoppers don’t have access to — despite the fact that in-store shopping accounts for more than 92% of the retail volume, according to Forrester Research.

Retailers will be able to use the app to build in-store traffic by connecting with individual consumers, turning marketing into a welcomed service that is not intrusive.

In turn, the app can make it easier for retailers to understand consumer likes and dislikes and offer related products in other aisles, such as bananas or milk, to accompany a cereal purchase. It could also make loyalty points and digital coupons become more convenient for shoppers, freeing them from the hassle of searching for discounts.

Too bad the app won’t be ready in time for net week’s MobileBeat 2012, which is being held at the Palace Hotel in downtown San Fran next week (July 10-11).

AllThingsD’s Kara Swisher, Mark Pincus (CEO, Zynga), Michael Bayle (SVP and GM, ESPN Mobile) and a host of other mobile luminaries will be coming together to talk mobile applications, design/UI, and ecosystem, among other mobile-relevant topics.

Conference sub-themes include Tablets, IT: Consumerization, Infrastructure/Cloud: Scale Is Beauty, Monetization, Retail: Wait, Why Are They Coming? and Designing Distribution.

You can register for the event here.