When starting a new business, a good bit of advice is to choose a business that offers a large opportunity, rather than a small opportunity. All other things being equal, a similar investment of effort will produce larger returns if the market opportunity is larger.
That is one reason tier-one service providers around the world, taking a look at growth opportunities, are looking at advertising, banking and machine-to-machine initiatives. Some might include cloud computing businesses among the top possible new areas as well.
The small list results because there are relatively few new lines of business a large service provider can enter that will provide sufficiently-large revenues to justify the effort. You might also note that all those efforts rely extensively on mobile networks and devices, with the possible and partial exception of cloud computing.
One reason there now is growing activity around retail payments, loyalty, advertising and marketing is that the opportunity is so large.
John Donahoe, eBay CEO, points out that e-commerce is a $325 billion market, while retail is a $10 trillion business. That means virtually every function and business that supports the retail commerce function is an order of magnitude larger. Retail commerce 10 times bigger than online
The key these days is that the line between shopping online and shopping in-store is blurring, with the mobile device at the center of the change.
Some customers will begin their shopping experience online by researching a product, while other customers will simply enter the store and look up products on the spot via their mobile phones, but these two separate actions are merely pieces of the shopping experience. Ebay CEO John Donahoe merging of In-Store and E-Commerce
“In over half of all retail transactions today, the consumer accesses the web at some point in the shopping cycle,” either to conduct product research, buy it or pay for it,” says John Donahoe, eBay CEO.
“What we see happening in the world of shopping and payments is someone analgous to what has happened to digital media,” said Donahoe. “Consumers are driving enormous change in how they shop and pay.”
eBay chief executive John Donahoe said that the line is blurring between offline and online shopping and his company plans to serve consumers as they move back and forth between them.
Donahoe said his company has set up an open commerce platform so that eBay can essentially become the operating system for commerce
