M-Commerce is here to stay!
If you can’t surmise from my recent tweet about papa’s new MacBook Pro investment, I better zip my lips up about one of the emerging technology-driven waves of commerce termed “mobile commerce (or m-commerce).” Or not? Figure it out! Needless to mention, anybody who knows me well can probably attest to my obsession with my iPhone. I’m not particularly proud of it, but you get my drift.
Enough about me – what is m-commerce anyway? In layman’s terms, this new and ubiquitous retail channel essentially refers to a way for consumers to conduct commerce or complete transactions using a mobile (or cell) phone, a PDA, a smartphone or any mobile equipment. In certain contexts, this mainstream channel is discussed as almost a separate channel – not just an offshoot of e-Commerce (electronic commerce).
The proliferation of smartphones (like the iPhone, BlackBerry, Android, etc.) coupled with the increasing reach of 3G and perhaps 4G mobile networks has fueled the growth of the mobile channel and, more so, the emergence of mobile marketing as a significant piece of the marketing mix. Mobile marketers can now device a number of large-scale marketing activities aimed at engaging consumers in rather unprecedented ways. With the ever-increasing fragmentation of media, online/mobile marketers are forced to focus on multi-platform media strategies in order to prop up customer acquisition and retention.
The big boys in eCommerce are already on the bandwagon. Notably, Amazon.com and PayPal recently opened up their payment platforms to let application developers create mobile commerce apps. Kraft, Johnson & Johnson and Wal-Mart, have already started defining open standards aimed at helping businesses and consumers to better interact using mobile devices. Google, PayPal and Amazon have all created APIs (application programming interfaces) that allow developers to tap into mobile payments, product searches, etc.
As you can imagine, M-Payment compliments M-Commerce. Credit-card companies are working to make the use of cards via mobile devices more convenient as well. According to Tim Attinger, global head of product innovation at Visa, the company will release an app. later in the year that stores a user’s credit-card information on a mobile phone so, when a consumer goes to a retailer’s mobile Web site to pay, it will “pre-populate” the payment fields.
As consumer behavior regarding shopping and brand loyalty evolves, businesses have to stay cognizant of innovative ways to enter into long-lasting relationships with consumers. Closer and even more personalized customer experiences are possible with the mobile channel. According to the GSI whitepaper; there are over 3 billion mobile phones worldwide. This means that over 40% of the world’s population carries a mobile phone, far more than the % of people who use a computer or have access to the internet. In many developed countries, mobile phone penetration is above 90% and developing countries are catching up fast. Yet and still, though the m-Commerce trend is more pronounced in Asia and Europe it is quickly gaining traction in the US.
Some good m-commerce facts:
- According to Nielsen Mobile, only 7% of the 90K US mobile subscribers surveyed had engaged in any sort of m-commerce by the end of Q2 of 2009. Of these, only 25 percent made a purchase through their smartphones.
- According to Darcy Travlos, Harris Interactive and Billing Revolution released a new study this past summer that revealed that 45% of cell phone users are very comfortable with mobile transactions. Juniper estimates mobile payments will grow to over $300 billion by 2013.
- It is expected that m-commerce sales would reach $800 million by the end of the year, compared to $346 million in 2008.
- Jim Ensign, Vice President of Papa John’s, posits that by the end of last year mobile sales had reached about $1 million and continues to rise at a tenfold pace this year.
- By the end of 2009, about half of established retailers may have mobile web sites, up from less than 20% in 2008, Beccue estimates. “Really, it’s us keeping pace with our customers,” says Mike Dupuis, a vice-president for marketing at apparel retailer American Eagle Outfitters, which launched its mobile Web site in September. “We believe this is a critical place for us to focus our attention.”
- In Q2, 28% of all handsets sold in the U.S. were smartphones, up from 19% a year earlier, according to consultant NPD Group.
Next, I will debunk the different ways in which online retailers are monetizing this channel. Until then, stay tuned and get with the program, “will ya?”
Jay is discussing. 
RaiulBaztepo, 
Jay 5:56 pm on December 2, 2009 Permalink |
I couldn’t agree more. I’m interesting in learning how other e-tailers are taking advantage of the mobile channel