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Mobile Technologies Becoming A Growth Engine For Small And Medium Businesses

This article is more than 9 years old.

The top 25% of small & medium enterprises (SMEs) are seeing two times the revenue growth and up to eight times the number of jobs created based on their adoption of mobile technologies.

SMEs that lead their industries in mobile adoption are also seeing up to 50% of all web searches for their businesses start on mobile devices.

Consumers worldwide value mobile technologies at 11% to 45% of their incomes. The majority are willing to give up luxuries for a year in order to keep their mobile phones.

These and other insights are from the recently published study The Mobile Revolution: How Mobile Technologies Drive A Trillion-Dollar Impact which can be downloaded here (free PDF, no opt-in). The Boston Consulting Group and Qualcomm collaborated on an extensive study of six countries’ adoption of mobile technologies and have provided an extensive summary of their findings. The six countries covered in the study are United States, Germany, South Korea, Brazil, China and India. These six countries represent 47% of global GDP and form the foundation for BCG’s analysis of how much mobile technologies contribute to global economic growth. Mobile technologies contributed between 2 to 4% of countries’ GDP in 2014, with South Korea being an outlier at 11% delivering a mobile GDP (mGDP) valued at $143B.

Key take-aways include the following:

  • Mobile technologies are emerging as a growth engine for small and medium enterprises (SME), with the top 25% of adopters seeing two times revenue growth and up to eight times the number of jobs created.  Mobile is a catalyst of global employment growth with 11 million jobs created by the mobile value chain.  BCG found that venture capital investment in mobile technologies has doubled as a percentage of total VC investments, reaching 8% or $37B in 2014. The following graphic provides an overview of how mobile technologies are becoming a catalyst of global economic growth.

  • Mobile content and apps generated $530B in revenues globally in 2014; sales of mobile devices through retail, $520B; and mobile devices sold through OEMs, $450B.  BCG’s study found that mobile technologies generated nearly $3.3T in revenue last year.  The following graphic provides a breakout of revenue generated by service and technology area.

  • Venture capital (VC) funding in mobile technologies doubled from 2010 to 2014 increasing from 3.8% of all VC investments to 7.9%.  BCG also found that mobile’s share of VC investments is more than double its share of GDP, indicating how crucial innovation is to the continued growth of this industry.  The first graphic provides an analysis of how the $37B in VC investments was allocated across a diverse series of mobile investments in 2014. The second graphic shows how mobile intellectual property (IP) innovators and component designers are second only to biotechnology in industry R&D investment as a percentage of revenue.

  • Small and medium enterprises (SMEs) who adopt mobile technologies to stay connected with customers and streamline operations are growing revenue 2X faster and developing 8X more jobs than follower and laggard SMEs.  The following graphic provides an overview of how mobile leaders are consistently outperforming their counterparts:

  • 82% of SMEs who are leaders in mobile adoption say that mobile technologies are giving them greater flexibility and agility in connecting with customers. 60% of mobile leaders say that investing in mobile technologies is a top priority for their businesses, compared to just 15% of laggards. Mobile leaders are seeing up to 50% of all searches for their businesses from mobile devices. The fastest growing businesses adopting mobile technologies are SMEs. The study found that mobile adoption leaders have successfully integrated their mobility platforms with enterprise applications, further strengthening customer relationships and greater visibility across each phase of production.  The following graphic provides an overview of revenue increases, efficiency gains and innovation levels being attained:

  • Consumers worldwide value mobile technologies at 11% to 45% of their incomes.  India’s consumers value mobile technologies and technologies at 45% of their monthly income, followed by China (43%) and Brazil (20%). This is far above what they often pay for monthly service. The following graphic compares the value as a percent of income consumers attribute to mobile technologies.

  • Giving up dining out for a year (64%), one day off a week (51%), or 20% of the space in an apartment or house (45%) are among 10 different areas global respondents are willing to sacrifice than lose the personal use of their mobile phones.

  • R&D investments in mobile technologies are often uncertain and face continual competitive pressure & challenges before they reach commercial success.  The following graphic shows how long and complex the commercialization process is for new mobile standards and technologies, starting with 1G and progressing through 4G:

  • SMEs drove global mobile payments to $630B worldwide in 2014, up from $210B in 2010.  BCG cites a recent Jupiter Research study that explores how mobile payment solutions including Square are enabling SMEs to be more agile, efficient and responsive to customers’ selling strategies.

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