Rowan is the co-founder and CEO of Pattern. He has been involved in a number of technology start-ups, and has also held senior executive roles in both the technology, and technology marketing sectors.
Mobility - a powerful industry disruptor
The sixth iteration of Apple's iPhone was announced a few days ago with much fanfare. In the seven years since the original Apple smartphone was released much has happened.
Devices and mobile applications have multiplied at an astounding rate, and have already made a significant impact on business from multiple angles. If your industry hasn't already seen fundamental changes due to mobile, it's probably not far off.
Sound like an exaggeration? Think about the music industry. Music used to be distributed on CDs at megastores like Virgin Records. Consumers had to purchase entire albums, whether they wanted one song or ten. Then Apple turned the music industry on its head, launching the iTunes store in April 2003 with legal, easy-to-use, a-la-carte song downloads.
Consumers could browse hundreds of thousands of songs and download purchases to their iPods. By the end of that first year, 25 million songs had been downloaded. Once the iPhone arrived, consumers began to use their smartphones as their personal music libraries.
We've since seen further disruption with services such as Pandora and Spotify offering streaming music selections from massive libraries but the out take remains the same.
If you are making the customer do any extra amount of work, no matter what industry you call home, you are now the target for disruption.
Aaron Levie, CEO of Box, in his 2012 Simplicity Thesis
So, what exactly is disruptive innovation?
Coined by management guru, Clayton Christensen, disruptive innovation is a concept “…by which an innovation transforms an existing market or sector by introducing simplicity, convenience, accessibility and affordability where complication and high cost are the status quo.”
Here’s a brief overview of the mobile disruptions currently occurring in a handful of industries:
Healthcare is a complex industry evolving rapidly due to cultural, regulatory and technological changes. Opportunities for mobility disruption are plentiful. Healthcare providers are being financially incented to reduce hospital readmission rates and improve patient health metrics. To achieve these goals, patients must participate in managing their personal health. Mobile devices with health-related applications are well-suited to engage patients, gather appropriate data, communicate information to healthcare professionals and empower consumers to make better healthcare choices.
The number of mobile disruptors in the healthcare space is overwhelming. Here are just a few:
- The Carewire mobile messaging platform helps patients increase medication compliance by providing regular prescription and refill reminders.
- Health data analysis solutions, including Clinicast, help providers identify at-risk patients so physicians can take proactive measures and avoid patient readmissions and medical complications.
- Secure chat, video, text and messaging platforms enable more frequent communications between patients and healthcare providers. Mobile disruptors, including Breakthrough, a video counseling app, and GoGo Health, a platform for remote diagnoses, are providing alternatives to the traditional office visits.
- Secure platforms like Simplee and CakeHealth are helping individuals understand their healthcare expenses and make financial decisions to optimise HSA/FSA contributions.
- Castlight Health and OkCopay are services that increase cost transparency in healthcare and help individuals find the best health services at the best prices.
- The quantified-self movement results in a growing demand for personal health devices. The Scanadu Scout is a medical tricorder that tracks and measures various vital signs.
Mobility innovators are transforming healthcare into the affordable, accessible and amenable system that has been eluding us for decades. The digital disruption of healthcare will ingrain personal health management into our daily lives, influencing our behaviours and health decisions.
Square is a seamless end-to-end solution in the financial technology sector. Plugging in its pocket-sized card reader and installing its Square Register app, enables any small business merchant to turn a smartphone or tablet into a point of sale device. Customers can swipe their cards to make a payment. The company distributes the card reader and software for free and charges business owners a small swipe fee.
Square is also a leader in peer-to-peer payment technology. Square Cash offers a simple service to invoice and pay, enabling users to deposit cash in a bank account via a text message or email, free of charge.
The corporate expense report is being updated. Abacus deploys mobile technology to drastically simplify expense repayments. Using tagging functionality, the Abacus app enables users to add locations and photos of receipts in order to provide the necessary context for speedy approval and reimbursement. On the flip side, the app automatically categorises spending by employee, type, location and project, and syncs with bookkeeping software like QuickBooks.
Payment innovations that disintermediate banking systems have emerged:
- Apple Pay replaces the payments process we're all used to with a near field communication (NFC) antenna, Touch ID, Passbook, and something Apple is calling the Secure Element, a dedicated chip that stores encrypted payment information.
- Bendigo Bank launched a mobile payments scheme to compete with EFTPoS and PayPal.
- PayPal has expanded its in-store and mobile payments services.
- Visa has delivered a mobile wallet allowing online shoppers to pay across multiple online sites with just one user name and password.
"The taxi industry has been ripe for disruption for decades," Travis Kalanick, CEO of Uber, recently said to Businessweek. Uber is the leader in the competitive taxi and ride-sharing service market. The app's "one tap to ride" functionality makes finding a taxi quick and easy.
The app uses GPS to locate nearby Uber-authorised drivers in real time, and enables users and drivers to rate each other after the ride. Anyone with a credit or debit card and a smartphone can book a ride, eliminating the need for cash exchanges. By connecting drivers and riders through mobile, Uber has successfully delivered a simplified solution for the taxi industry.
This London-based startup is disrupting the event discovery scene. YPlan allows users to find, organise and book tickets for events. By targeting users 48 hours prior to an event, YPlan caters to its target urban demographic by addressing a need unmet by traditional ticket merchants who prefer to sell out weeks in advance.
The YPlan app operates in densely populated cities such as London, New York and Las Vegas based on the premise that busy city dwellers don't like to commit to events far in advance.
By pushing a daily list of ticketed events straight to smartphones, curated to individual preferences, it saves time spent searching for what to do tonight. YPlan sets up a win-win situation by generating profit from sales commissions for itself while event promoters profit through incremental sales of excess tickets.
The ability to move education online and make it accessible to many has caused a proliferation in online course providers. Always wanted to learn a foreign language? Duolingo lets you do that for free at any time and from anyplace. The app was voted iPhone App of the Year in 2013 and TechCrunch Education app of the year.
Travel The traditional travel agent business model has been under siege for the past two decades. But prior to smartphones, we still printed our boarding passes, booked hotels and flights well in advance, and manually kept track of our travel itineraries.
Mobility has changed this almost completely. Airline apps enable us to check in and present our tickets electronically, and they continuously update us with current flight ETAs and gate change information.
A glut of mobile apps has arisen around the concept of last-minute deals for hotel reservations, cruise bookings and other travel accommodations. Using their phones, travelers can make last-minute vacation plans that are often much less expensive than ones made months in advance.
GPS Remember TomTom and Garmin devices? Once high growth businesses, their sales have declined dramatically. Apps, such as Google and Apple Maps, along with built-in GPS capabilities in smartphones have all but replaced this product category.
The Waze app is improving the commuting experience for many by providing crowd-sourced alerts about traffic situations, road hazards, alternate routes, etc. By incenting users with points and rewards for posting information, Waze has turned maps into a game and created something wholly new in the GPS industry. It’s no wonder Google spent $1 billion to acquire it.
The Power of the Individual Spurs Innovation
Google, Facebook, Twitter, smartphones, tablets and e-readers (technologies that originated in the consumer space) are now reshaping the way companies communicate and collaborate with employees, partners and customers. Through new opportunities for "social listening," businesses are better able to understand what their customers and employees need and want.
Currently, several disruptive technologies are converging to form what venture capitalist Fred Wilson calls a Golden Triangle of Disruption. It’s defined by 1) mobile, 2) social and 3) real time. This convergence is altering how people connect, communicate, socialise and make a living.
Not only are companies adapting, many are adopting a prescribed effort of “mobile transformation.” Mobile transformation disrupts both traditional business models and current technology roadmaps. Organisations are faced with an increasing need to update legacy technology strategies and supporting methodologies to better reflect how the real world is evolving.
Smartphone technology delivers remote access to health care, education, entertainment and so much more, while blurring boundaries between industries. The power of the individual is growing and new competitors are emerging, disrupting industries and creating new business models.
Consumers and businesses want more powerful devices and applications. They understand what’s possible and they are seeking more cost-effective technologies to cope with increasingly complex challenges. Satisfying these demands is leading to explosive growth in data and analytics, to the launch of hundreds of upstart competitors, and to the disruption and realignment of almost every industry. We are only at the beginning of the app revolution, and the business disruptions caused by mobile technologies.