Should retailers invest in m-commerce?

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The gloves are off
The gloves are off

Hipcricket's Jeff Hasen and's Paula Drum discuss the pros and cons of retailer investment in m-commerce


Jeff Hasen, CMO, Hipcricket
18 years experience in marketing and five years in mobile marketing

As smartphones become the norm, it's easy to see how the term “mobile commerce” will be replaced simply with the term “commerce.” In the “duh” comment of the day, brands need to sell products and services in order to survive. However, it's the path to that sale that is most interesting − and if that path goes through mobile, a company develops engagement and builds loyalty.

Mobile commerce is more than just using a cell phone in place of cash or credit card. Mobile commerce includes everything from companies having a mobile-friendly website to consumers using mobile coupons and gift cards, scanning mobile barcodes and, yes, even using their phones to make a payment. Have you ever visited a retailer's website via mobile to compare products? Donated to a charity or relief effort via SMS? Presented a coupon at the point of sale on your phone? If so, then you've participated in mobile commerce. 

According to Juniper Research, mobile retail opportunities in coupons, smart posters and advertising will combine to create a market worth more than $12 billion by 2014. In another recent study of the channel, the Mobile Marketing Association found that approximately one in five US adult mobile phone owners has used his or her cell phone for mobile commerce in the past month. The organization also found that 6% of consumers said they had used their mobile phones to receive coupons or discounts, and the same percentage used their mobile device to purchase physical goods or non-mobile content or services. These statistics paint a compelling picture for mobile commerce.

“Mobile” also means more than just phones. The proliferation of other mobile devices, which can serve as platforms for mobile commerce, are also extremely compelling. The iPad and iPod Touch are great examples, as are other portable devices that have already proven to be successful mobile commerce enablers. These devices provide a slick and engaging customer experience, which is very desirable from a branding point of view. 

Many brands have already taken advantage of these devices for mobile commerce, experiencing great success. Brands who don't take advantage of mobile technology run the risk of being left disconnected in an increasingly mobile world.


Paula Drum, General manager,
More than 15 years' experience in marketing, as well as a retail background

Today, the answer IS “NO.” The technology to provide a top-flight mobile commerce customer experience has not yet arrived.

When a customer simply wants to browse for products, mobile sites and apps cannot compete with the capabilities provided by standard websites. The bandwidth to explore a mobile website or app with tens of thousands of stock-keeping units doesn't yet exist, making it difficult for consumers to have the deep experience they've come to expect. Traditional, seamless Web browsing, like sorting through thousands of products, comparing features, quickly scanning customer reviews, and viewing multiple images and zooms, is just not a reality on today's mobile platforms.

In terms of purchases, m-commerce is in a similar position to the early days of retail e-commerce. Consumers are not as familiar or comfortable with the medium and, with an increase in cyber crime, identity theft, etc., many are concerned with mobile security. According to recent m-commerce surveys, 20% of consumers use m-commerce for actual purchases. However, in many cases, these numbers include purchases like app and music downloads − very different than buying a product from an m-commerce retail site.

Currently, mobile commerce is great for searches for customers who are beyond the browsing mode and know exactly what they want to purchase. Mobile commerce allows the customer to check for that product's availability and order it directly or select it for in-store pickup. Mobile is also helpful in disseminating promotional alerts and operational information such as status updates.

There is no question that m-commerce is a helpful discovery tool. If a consumer is on the go and he needs to locate an item in his area, m-commerce can help him find it. However, at this point, consumers are reluctant to pay on their smartphones and are more comfortable with purchases made on traditional Web platforms or in-store.

M-commerce will be a factor in the future, but customers will not enjoy the best possible website experience until the technology catches up with the hype. For now, it's best to plan for how mobile fits into the future before experimenting in a fledgling platform.

Direct Marketing News' Decision

Mobile commerce is not an integral component of brand strategy today, but will be very soon. As more technology companies ready e-readers for release, consumers will demand far better m-commerce capabilities. Marketers should closely observe mobile pioneers, experiment and be ready to dive in the channel.


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