Jupiter Finds Slow Growth for Wireless Transactions

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Less than $4 billion in shopping and travel transactions will be done using Internet-capable phones in 2006, representing less than 2 percent of all online shopping, said a report issued yesterday by Jupiter Media Metrix.

Consumer interest in buying items using a wireless device is not a priority, as only 7 percent of consumers expressed a desire to transact with a mobile phone, according to the report, "Mobile Commerce: Profiting Despite Consumer Apathy." Nearly 2,100 individuals were surveyed.

But Jupiter analysts predict that shopping-related content on mobile devices will influence transactions via PCs and in brick-and-mortar stores, and that those sales will be valued at $39 billion in 2006.

The study also found that:

· U.S. merchant revenue via mobile devices will total $22 million in 2001 and be driven largely by occasional sales of entertainment and airline tickets, flowers and other timely gifts.

· Since the number of U.S. wireless users conducting transactions will not pass 1 million until late 2002, companies should focus their mobile-commerce ventures on bridging the wireless world with online commerce, catalog sales and offline retail efforts.

· Thirty-six percent of consumers who buy goods and services online avoid shopping with wireless devices because of concerns over the cost of access.

· E-commerce sites can attract a broader customer base to wireless shopping initiatives only by encouraging use and familiarity with their services. To build this base of consumers, merchants and carriers must drive familiarity, not transactions, among early adopters by encouraging browsing for price comparison, product reviews, store locator and item availability. Merchants also must take precautions to ensure security, including protecting credit card databases and communicating with consumers about the safety of their personal information.


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