Practical Ecommerce

Are Consumers Really Buying Products on Mobile Devices?

Ecommerce merchants may feel more compelled than ever to jump on the nearest mobile platform, but they need to decide if consumers are actually buying products – both digital and tangible – on mobile devices. To be sure, there is a frenzy of excitement around m-commerce, but let’s take a step back and really break down the flood of data that has come out between 2009-10 and see if there is anything substantial to be found.

Mobile-Data Usage Is Growing

According to analysts at Chetan Sharma, a technology-consulting firm, in the “U.S. Wireless Data Market Q2 2010 Update” report (available here in slide show presentation), in just one year, consumers in the U.S. have increased their mobile data consumption by 112 percent. And data traffic increased “across all networks” – meaning all brands and all subscribers have been using their phones for more than voice calls lately. Sharma’s report also shows that in the last six months alone, U.S. consumers were using 50 percent more data than they were during the first half of the year. So, how does this increase in mobile use translate directly to m-commerce? It seems the answer has to do with the product that is being sold, and the mobile device itself.

Look at Types of Devices

In May 2010, the Mobile Marketing Association (MMA) offered up strong evidence to this point when it conducted the “U.S. Mobile Consumer Briefing” study of 1,000 U.S. adult consumers and found that the type of mobile device affected the percentage of those that did any purchasing by a large margin. The two mobile phones that have the largest market share are iPhone and Blackberry (Android OS and Palm WebOS phones, although popular, were not included in the study) and the study suggested that Apple iPhone users purchased just shy of double the mobile content than that of the Blackberry user.

So, a merchant developing an m-commerce platform would at first seem shrewd to build an iPhone-friendly m-commerce store. But what if your customers mostly use Blackberrys or any of the Android running phones? It is possible that multiple mobile platforms would have to be implemented, one compatible for each device and OS, to take best advantage of a mobile platform?

The MMA also found that roughly 20 percent of users participate in mobile commerce as a way to buy mostly digital content, such as ring tones and apps. A merchant selling ring tones, apps, themes for phones should presumably not think twice about having a mobile commerce platform; it’s the ideal marketplace for that digital, intangible product.

Tangible Goods on a Mobile Device?

But, the MMA also showed only 6 percent of consumers used their phones to buy tangible goods. Ecommerce merchants with stores selling tangible goods – food, clothing or other physical items – should take that percentage into consideration when thinking of designing a mobile platform for an ecommerce store.

And finally, just this month MMA and Luth Research released the just published “October 2010 U.S. Mobile Consumer Briefing” PDF, another survey of more than 1,000 U.S. adult consumers with interesting results. The big number in the report that has a lot of people excited is that of the surveyed consumers, 59 percent plan on using their mobile phone for holiday shopping and that key demographic, age 25-34, plan to use their phone “to a great extent” for holiday gifts shopping. MMA points out that some of that is price checking, browsing for deals and discounts, but 13 percent of those shoppers plan on using their phones to purchase gifts. And the top products these surveyed holiday shoppers plan on buying: digital movies, music, consumer electronics and books.

Summary

The holiday shopping season may remind merchants to investigate a mobile platform. But the need to rush to mobile appears to be relative to the goods and consumer habits of a given ecommerce site. Curious merchants should begin by measuring how their consumers behave, what devices they use to shop with and how their own products fit into these trends to determine the best path for the approaching holiday season.

Practical Ecommerce

Practical Ecommerce

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  1. Jordan Cash November 24, 2010 Reply

    Great article and even better summation at the end. Getting to know your customers inside and out is everything. Understanding how they shop, when they shop, and of course where they shop will give retailers a much clearer of picture of not only the necessity of a mobile platform, but also what type of phone to focus on.

    And while the frequency with which people are actually purchasing items on their smartphones has yet to take off, the real key for me is the increase in data consumption and overall smart phone purchases. People will not doubt use their phones to navigate both pure play online sites and brick-and-mortar stores with an online presence. For that reason alone, it’s paramount retailers have a mobile platform that makes navigating through large numbers of SKUs easy and enjoyable.