Laurie--I just had one of those "duh" moments. Of course advertising can monetize apps. In fact, distribution is a perfect vehicle for this since suppliers can advertise through a distributor and many do. In the olden days of co-op advertising, the supplier and distrbutor split the costs. Whether it's on paper or digital, it still makes sense. Thanks as always!
Hi Bolaji, Yes, graphics often take time to load, but search engines, such as Google and Bing, continue to work on ways to speed up the Internet. What do I mean? Google in this post explains. Google distributes a monthly online publication called Think Quarterly. This time the Speed issue of Google's Think Quarterly is about the acceleration of everything. The search engines also spend time educating industry execs at a variety of companies on the importance of Web site page and app load times.
Okay, Laurie. It's possible apps developers could offer advertising to offset the cost of developing the application but that only compounds the problem. Ads are typically graphics heavy and take time to load, which could deter users. My feeling is that apps for mobile devices are complementary to all of the other services distributors offer and the cost may not be so high that they have to go through all these twists to justify the expense.
Sometimes, this type of marketing and sales activities is part of the cost of doing business. You may not see the payoff right away but if you are not in it, somebody else will take your place. The payoff, of course, can be tracked. A company can have buyers tell them how it learned about the service or how they get information about the distributor's linecard, etc. This may add to the cost of developing the apps.
Barbara, you can make money on a free application by offering advertising in the app. Even if no one places one order, the distributor can make money. Paper catalogs worked the same way. They offered information, not an ordering platform. The information sat side-by-side with advertisements from component manufacturers wanting to reach out to potential customers.
I like your scenario, Rohscompliant. I can see it. The electronics industry is ahead of the curve on many supply chain issues, but when it comes to offering a way to order components on mobile, there are a bit behind. I would take much for the electronics industry to catch up. I can see the mobile ordering system linked in to replenishment systems and warehouse inventory systems, too. I would just take a bit of work.
Thanks for the feedback, readers, and some real-life examples of apps-in-use. The part-substitution scenario sounds very plausible and could mean the difference between a sale/no sale. If only a few distributors offer apps, the one that does will win the business if an engineering order gets placed. This builds customer layalty, and so on. On the flip side, I agree that tracking a BOM on a cell phone would be a nightmare--no fault of the app--even a PC screen is often too small to get a full picture of what's going on with a BOM. At some point, I'd like to see how distributors "monetize" apps--in other words, how many orders does it take to make the effort worthwhile? Or is providing an app the new cost of entry and you are going to have to have one to even play in the game?
Between looking for parts on a tiny screen and looking at datasheets on a tiny screen I can't ever see apps taking off as a resource. Has anyone actually tried looking for a part on a phone. Sure, you can get right down to it if you already know the exact part number, but searching keywords and parameters is a serious pain because the search process for an engineer almost always ends up on the datasheet(and that's even more painful given the format of datasheets). Digikey's app is poorly implimented. I gave it a fair shake, but if you are going to look for parts going into an actual design, it is still near impossible to use and the regular website still works much better despite the small format on a handheld screen. The only "innovation" it has is the abillity to scan barcodes on part packages and bring up the product on the web which is a help in the stockroom, but that kind of technology has been around for years.
The real benefit for distributors and suppliers may very well be that their component supply, supported by such apps, are the first options that the engineering/procurement folks find for their application during the development phase. Once designed in, the supplier is in a good posiiton.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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