The Future of Mobile Apps in the Supply Chain

Mobile applications will overtake the buying process when it comes to electronics and all other products through downloadable applications that sit on tablets and smartphones. Lucky to have a wide view of the mobile industry outside of electronics and engineers, I can climb out on a tree limb and predict that buyers procuring raw materials will do so through tablets and mobile devices during meetings, while traveling, and at other times with help from applications specifically designed by the companies providing the goods. A downloadable app that works well for ordering, price checking, sorting, and the distribution of goods throughout the supply chain locks in the buyer to that specific company.

Any company not taking advantage of the opportunity to design this type of application -- which might work like a Word document, an Excel spreadsheet, or a video game through a software as a service (SaaS) platform -- will miss a huge opportunity to capture market share.

The electronics supply chain led the trend towards mobile applications catering for warehouse inventory systems. When addressing tablets and smartphones and other mobile devices with advertising executives, I often reference electronics companies and the move towards monitoring inventory on mobile devices. The trend has begun to show up among consumers as they move their use of email, Internet browsing, and social networking from PCs to tablets. And as a consequence, consumer PC use continues to decline, according to The NPD Group’s Evolving Technology Trends report released last week.

In fact, 30 percent of tablet owners participating in the survey said they are emailing and browsing the Internet less on their PCs, and 28 percent said they use social networking features less. Of the 2,400 consumers participating in the December 2010 survey, 35 percent of the smartphone owners said they shifted email consumption from their computers to their phones. Internet browsing and social networking have not yet made as much of an impact, but the NPD report suggests tablet owners are headed in that direction.

I'm not a huge tablet fan, yet. My iPad, a novelty at first, now sits connected to the Google TV in the living room with a variety of movies from Apple iTunes downloaded on it. Stephen Baker, vice president of industry analysis at The NPD Group, told me the device of choice is moving towards the tablet. He said the experience of searching the Internet on a phone is still more difficult, and an application would improve the experience. But at least for the foreseeable future, people will still have the mindset of searching the Internet, rather than the app store.

Remember how the Palm organizer with the attachable keyboard was supposed to revolutionize mobile devices? Palm users could type on the fold-up qwerty keyboard or connect it to an accessory that provided more space for fingers to type. Still, the virtual keyboard gets mixed reviews. Baker says other NPD data suggests sales of keyboards for tablets continue to rise.

The biggest problem: Cellular service on mobile tablets lacks growth. 60 percent of tablets purchased have Wi-Fi; 40 percent have 3G. Of those consumers purchasing tablets with 3G service, only about half activate it, according to The NPD Group.

To spur growth among consumers, cellular carriers will need to offer options for multiple devices in a household or per consumer. Personally, I have four devices that have cellular models built in. My smartphone is the only activated device, but I would love to activate them all. It's more about cost than anything else -- one price for service, no matter how many devices. Baker says it's something the carriers realize they need to provide. And though he doesn't believe it will increase adoption, I do. The NPD data suggests about 80 percent of people who buy tablets use them in their homes. Yes, that's because they don't want to pay the cellular fee for another device.

Meanwhile, 68 percent of consumers said they are very satisfied with the Internet experience on tablets; 67 percent with email; and 60 percent with social networking. Smartphone users are less satisfied when it comes to those three important tasks. 59 percent of smartphone owners said they are very satisfied with email; 49 percent with social networking; and 42 percent with browsing the Internet.