Mobile Small Business Trends for 2012

by Gerry Blackwell

The mobile revolution is in full swing. Will 2012 be the year it takes hold in the small business market?

If there is one safe prediction for 2012, it's that mobile devices and apps will become increasingly mainstream, table-stakes technology for small businesses.  

A recent survey by consulting firm SMB Group showed that small- and medium-sized businesses plan to significantly increase spending on mobile in 2012, with firms in the five-to-49-employee range leading the way.

Nielsen, meanwhile, reported that almost half of American cell phone users now have smartphones -- 44 percent as of October 2011. And IDC reported that 18.1 million tablets shipped in 3Q alone, a 23.9 percent jump from the previous quarter, 264.5 percent from the same period in 2010.

The mobile revolution is real, but how specifically will it affect small businesses in 2012?

We put this question to two keen observers of the small business market: SMB Group partner Laurie McCabe, and Mark Tauschek, lead research analyst at Info-Tech Research Group Inc.

Mobile Payment

McCabe and Tauschek agree on at least one key trend for 2012: small businesses will begin to adopt mobile payment -- using smartphones or tablets with add-on card readers and low-cost online credit card processing services such as Square and Intuit GoPayment.

"A lot of very small businesses especially haven't really had a mechanism for accepting credit card payment," Tauschek said. "Now they do, with a simple hardware add-on and an app for their iPhone or iPod touch."

Mobile POS (point of sale) terminals could be used on retail sales floors to relieve congestion at fixed cash points, or in more purely mobile environments such as craft and farmers markets, or where a mobile provider delivers a service to a homeowner or business and needs to take payment on the spot.

"This is a huge thing," McCabe said. "Especially as retailers don't have to spend any money [on the service] and the readers are fairly cheap or free. It makes it very easy when you're on the go, and some small businesses are always on the go."

Some retailers may adopt mobile payment simply to make themselves appear more leading edge. For example, Apple's own uber-cool stores were mobile payment pioneers.

Most small business owners can't afford to switch just because it's the cool thing to do, McCabe said, and most won't. But new businesses or those with outdated equipment should consider mobile payment for the business advantages it offers.

Small Business Mobile Becomes the Norm

Small businesses that learned early to use mobile technology to make them more accessible and more responsive to customers have enjoyed a decided competitive advantage, Tauschek said, but that advantage may not last much longer.

He believes that with the huge growth in the installed base of smart mobile devices and the ubiquity of broadband wireless connectivity, 2012 will be the year in which being super-accessible and instantly responsive from anywhere will become an expectation, the norm.

This applies to businesses of all sizes, Tauschek said, but it's especially important for small businesses to be proactive and exploit their nimbleness to gain the advantage over bigger competitors.

"It will no longer be adequate to respond, ‘Yeah, I got your email and I'll get back to you in a couple of days.' Now, you have to be able to say, ‘I'm going to interact with you immediately, over whichever channel you prefer -- instant messaging, social media, voice.'"

Moving Beyond Email

A key prediction from SMB Group for 2012 is that, in the mobile realm, small businesses will start to move beyond basic communications and Web browsing applications.

Many are now looking at adopting time management, field service, customer relationship management (CRM) and even enterprise resource management (ERP) apps, McCabe said, as well as vertical, industry-specific apps in fields such as health care.

"Now they can check on the inventory status of a product or enter time spent on a project -- anywhere, anytime," she said. "It streamlines the way they do a lot of things, and helps them be more responsive to customers. And that is good for business."

Many small business owners may even prefer using mobile versions of popular business applications originally developed for the PC. "This is just anecdotal, but I've had small business people telling me they prefer to use these applications on their smartphones," McCabe said. "In a lot of cases, it's because the mobile interface is so nice and clean."

Is 2012 the Year of the App?

The increasing ease-of-use of maturing mobile apps is, in fact, one of "the key building blocks" that will make 2012 a "breakout year for apps" in the business world, Tauschek said.

Part of that comes from mainstream software developers paying increased attention to mobile. Some now design or upgrade applications from the ground up with mobile in mind. "Mobile is now the first design point for a lot of vendors," McCabe said.

Part of it, too, is that many developers have realized they don't have to put everything-but-the-kitchen-sink into their mobile apps. Some are producing multiple apps with bite-size chunks of functionality.

SAP, a small-medium enterprise ERP vendor, is the most obvious case in point. SAP offers many mobile apps, including some as specific as one for capturing travel receipts and sending the data back to SAP servers.

"They've made very elegant interfaces," McCabe said of the mature mobile business apps now appearing. "And they've given users only what they need, without cluttering [the app] up with [all the functionality] of a full-fledged Web client."

Not every small business will adopt applications as sophisticated as SAP in 2012, but Tauschek says the year will see more mainstream business apps such as Dropbox and Boxnet -- two companies that provide mobile access to online file storage and synchronization services -- "increasingly permeate small businesses."

Accessing the Mobile Cloud

Increased adoption of cloud services and applications (like Dropbox and Boxnet) is another mobile trend to watch in 2012, Tauschek believes. But it goes beyond online storage, already a well established mobile cloud app.

Lots of other cloud-based mobile apps are already available, including two from cloud pioneer SalesForce.com. These include the company's flagship CRM application and its Chatter collaboration tool. More will come, Tauschek said.

One game-changer is Apple's Siri, an artificial intelligence- and speech recognition-based "personal Web assistant" that will help iPhone users perform all kinds of functions, including finding stuff on the Web -- thus challenging Google's search engine.

The key to Siri's power, Tauschek said, is that it leverages ubiquitous broadband wireless capacity to access sophisticated capabilities residing on Apple Web servers rather than relying only on program code on the device.

Siri is so far available on the latest iPhone 4S model, but is expected eventually to be available on other iPhones and possibly the iPad.

Mobile Intelligence

Siri is an exemplar of another trend to watch: artificial intelligence (AI) built into mobile devices. Tauschek admitted it's hard to predict the impact of increased use of AI, a loosely defined set of capabilities that allow computer systems to learn and automatically adapt to circumstances and users.

"Think about this from the small business perspective," Tauschek suggested. "If you can turn your smart phone or tablet into a truly intelligent personal assistant, how will that improve all your touch points with clients?"

Android Ascendant

Apple may still have disproportionate mind share, but Google's Android mobile platform is on the rise, Tauschek said. 

"In the tablet market especially, the iPad has really been the only game in town," he said. "But that's changing. And while it might seem to be changing slowly, it's actually happening quite rapidly now. You have to remember that everything [in the Android world] is lagging about year-and-a-half behind Apple." 

With the rapid expansion of the number of available Android apps, and the fact that the latest version of the Android operating system works equally well on smartphones and tablets – as does Apple's iOS -- Google's mobile platform is finally catching up. 

That may make it more attractive to small businesses, but it cuts two ways, Tauschek said. The fact that apps available in the Android Market are not vetted by Google or anyone else -- unlike apps in the Apple App Store which must all pass stringent vetting by Apple -- means security of Android apps could be a concern, he cautioned.

The Year Ahead

What else will 2012 bring? McCabe believes small businesses -- and businesses of all sizes -- will start to make more use of text messaging. Many customers may not want to receive unsolicited marketing messages via text, she said, but they might welcome alerts and other kinds of messages. 

And she expects to see cross-platform services emerge to simplify data backup, recovery and security on both mobile devices and laptops and desktop computers. 

And 2012 could mark the beginning of a consolidation phase in the mobile industry, which may or may not affect small businesses. AT&T is making a play for T-Mobile, for example. There have been rumors of various suitors for ailing Research in Motion (RIM), maker of the BlackBerry.

RIM's declining fortunes may be a cause for concern among enterprises that invested heavily in inhouse BlackBerry Enterprise Servers (BES), Tauschek said. But small businesses that use the Web-based BlackBerry solution need not worry. If they're nervous and want to jump ship, they can do so with minimal disruption, he said.

Will 2012 be a breakout year for mobile in small business? We think so. The sheer mass of devices -- those purchased by companies and the personal tablets and smartphones that employees bring to work -- create opportunities just too important to ignore.

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This article was originally published on Wednesday Jan 4th 2012
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