Today, a business can achieve the “market-of-one customer” objective with mobile technology by reaching an individual customer directly at any time and any where, using mobile apps.
In an exclusive interview with DEALSTREETASIA, Professor Tung Bui – who currently holds the Matson Navigation Company chair of global business and is the director of the Vietnam Executive MBA of the Shidler College of Business – talked about both the opportunities and the challenges for the young Vietnamese companies, in building a mobile economy ecosystem.
Can you give an example that failed in its quest to build the mobile economy? What were the lessons learnt?
The era of mass production and mass consumption is slowly disappearing. In this era, we need a mobile ecosystem. We need merchants, banks, internet service providers and customers to agree on an integrated platform for financial transactions to occur. With some colleagues from Switzerland, I have done some on mobile payment there. While Octopus, an e-cash platform in Hong Kong, is extremely successful, Switzerland – the land of banking and high-technology, is still trying to figure out how to launch a form of mobile payment that all stakeholders are willing to adopt.
So the idea is to find out something that is unique, not only for Vietnamese users, but for all mobile device users. I have two recommendations. First is to keep observing the users (from all categories from business people to normal consumers). There are lots of daily needs that an app can assist. Another recommendation is to browse through the massive amount of apps that are now available in the markets. It is estimated that as of today, there are more than 500,000 apps for the App IOS ecosystem, and more than 700,000 apps for the Android platform. Not all of them are successful, and maybe there are some ideas that could be modified and enhanced to fit our needs.
What do Vietnamese businesses need to do to capitalise on the opportunities of this economic era?
First order of business would be to identify a real need of your customers in the Vietnam economic, social and cultural context that mobile apps can solve. Let me try with some examples. An investor would appreciate receiving timely information about an investment opportunity that just emerged a few seconds ago. A grocery shopper would want to be able to download an “e-voucher for a discount” while doing grocery shopping. A sales person can access through his/her tablet detailed information about their products at the client site to help negotiate a deal. Also, traffic is VN is getting much heavier, a real-time app would notify its users the traffic situation (accident or roadwork) so that the drivers can decide an alternate road.
Based on some preliminary discussions I have had with some of the colleagues doing mobile apps in Vietnam, it seems to me that we need to be more creative in finding an idea that is both technologically doable and economically feasible.
Second issue is to define the market segment carefully. The percentage of smartphones and tablets is still small compared to the millions of Vietnamese internet and/or 3G users. Many of the owners of smart mobile devices do not know how to take advantage of these advanced technologies. Thus, we need to develop a mobile app that is intuitively easy to use.
We need to focus on apps that improve the efficiency and effectiveness of doing business in Vietnam – those that help production managers to improve productivity, finance and accounting officers to better manage their financial flows, and salespeople to reach out to their customers more effectively.
Another major barrier to entry the mobile economy is the lack of angel investment in searching for “killer apps”. Indeed, investment in apps can be risky. We are not sure if a new idea would be adopted and need to explore ways to raise investments for these projects. The good news is that development cost for mobile apps are relatively low.
How is the ability of integration of local firms?
As I mentioned the difficulty of launching a new mobile payment in Switzerland, we need many stakeholders to agree to work together. The need for collaboration should be seen as a win-win partnership in a value co-creation ecosystem. The good news about Vietnam is that we don’t have a history of legacy systems. As we start from almost nothing, it would be easier to jump directly to a new modern ecosystem.
From the perspective of software development, most of the apps are developed and build by one, two or just a few people. A typical model is a team of two persons, a designer with a clear vision of what the app should do, and a computer programmer that can code the app. Therefore, the coordination is less of a challenge than having a large team.
What do you think about competition with foreign players? What is being done in the country to bolster the ecosystem?
A natural approach to the mobile economy is to look at it as an extension to the current economy. We have an existing banking industry with its current practices. What kind of app development we can do to improve the quality of our existing banking operations? We have an existing approach to conduct our tourism industry – from hospitality management to transportation. What kind of apps we can develop to further improve our tourism industry? Think about it. The challenge for Vietnamese businesses is to quickly deploy mobile apps to support their customers as foreign firms are doing so.
My recommendation is that Vietnamese firms should follow carefully the evolution of apps development around the world and in the domestic market, at least in their industry. And try to look for a window of opportunity to come in.
I am pleased to see many workshops and seminar on this topic launched in Hanoi and Ho Chi Minh City. We are exploring the co-creation of a center for entrepreneurship, innovation and technology that involves our local academic partners, our business and industry networks, and most importantly, an extensive alumni network to nurture an environment that could make a Vietnamese mobile ecosystem to come to life and to prosper.