Is mobile a brand killer? The future of pricing in a mobile world

That’s a fairly dramatic title but if you look ever so close enough, you will see that we are entering a very volatile era in pricing that may eventually lead to the extinction of brand loyalty and a sharp change in the way prices are determined.

If you are a Star Trek fan — either the original Shatner version or the Next Generation Picard version — you know that the world in Gene Roddenberry’s mind has started to populate our daily existence. The personal communicator, the tablets, the voice recognition, the computers, the aliens…we are now living in his world and in his world, the act of exchanging currency for goods does not exist and there are no visible brands. Is that where we are heading?

Wal-Mart has spent a generation wringing efficiencies out of their channel and negotiating down the price they pay for their bulk buys so they can extend the same savings on to the consumer. The impact has been such a shift in the way we spend that, in case you didn’t know, Wal-Mart is now a gauge for consumer confidence in the United States. Price matters to us. While we want to spend money, good money, on certain things (cars, houses, subscriptions to UNTETHER.tv), things that were at one time prestigious (clothing, books, computers for example) are now commodities that we look for the best quality we can find for the lowest price.

It took three or four decades for Wal-Mart to disrupt the corner grocer, bookstore and clothing store and turn shopping into a generic chore — eons compared to what is about to happen when you inject the pure ingenuity of mobile into the fray.

Mobile is insanely distributed: 4.5 billion mobile subscriptions worldwide which is a massive mesh network that covers much of the globe and not a single one of us would turn down a deal on product if we had the chance, it is part of who we are!

It is early days but bear with me as I walk through what is unfolding right in front of those little screens we carry around with us everywhere. We have, at our fingertips or on our hips or belts, a gateway to always-on knowledge that makes price liquid and weakens brand-loyalty.

There are a number of mobile companies facilitating this today, right now. Services like YOWZA! and Clip Mobile offer location-based coupons, ShopSavvy from Big In Japan allows you to compare the price of any good against websites and other stores nearby. Combine that technology with services from location-based marketing companies such as Foursquare and Gowalla and opt-in SMS technology from Adenyo and you have the beginning of the perfect pricing storm.

In the not-so-distant future, this scenario could play out:

You will walk into any store anywhere in the world and, upon entering, stick your location with Foursquare or Gowalla or Google or Facebook. Instantly a coupon pops up for that location or a similar location nearby. You then find a product that you are interested in purchasing, scan the barcode with your phone and wait while it triangulates your location, searches the inventory of similar stores nearby and checks online for prices and availability. In a flash, you have a pricing landscape for that product which includes key trending analytics showing a demand curve with the optimum time to buy giving you much more power to make the best buy decision you can and choice of where to buy it.

The power of pricing shifts to you, the consumer, and you then dictate to the store how much you are willing to purchase the product for. Take it or leave it.

Can’t see it happening this way? Well, it’s already begun. How long did you take to make the agonizing decision to buy that $0.99 app on AppStore or AppWorld? How long did you debate the purchase price against the value you thought you would receive? My guess is far longer and at greater cost than giving of the buck. We are all price-aware and our viewpoint has shifted to a point where we seem to forget that we would have spent $20 on a PC application that did the very same thing.

And that only took one year…

About the author

Rob Woodbridge

I'm Rob, the founder of UNTETHER.tv and I've spent 14 years immersed in the mobile and pervasive computing world. During this great time I've helped some of the most innovative companies grow their business through mobile. If you are in need of a mobile business advisor or coach, connect with me here to get things rolling.

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