Smart retailers and brands have always succeeded by reaching the people where they are. Decades ago, this may have meant moving from Main Street to the local mall. More recently, it meant setting up shop online, supplementing or supplanting a brick-and-mortar presence with an e-commerce operation.
The answer may be as simple as asking yourself how you’re reading this blog post. The statistics say there’s a better than 50 percent chance you’re using a mobile device. Your customers and potential customers are just as attached as you are to their smartphones – if not more.
Mobile commerce – m-commerce – is already driving significant sales for online and traditional retailers. In the 2020s, m-commerce will graduate from a trend to a dominant commercial force.
What Is Mobile Commerce?
You can think of mobile commerce as a sub-category of e-commerce.
Mobile commerce is the buying and selling of products and services with the help of – or entirely through – wireless mobile devices. For the most part, when we talk about m-commerce, we’re talking about smartphones, such as iPhones and Android devices. But mobile commerce can also extend to tablets (such as iPads), e-readers (such as Kindles), and wearables (such as Apple Watches).
These days, you can buy almost anything with a mobile device, including food orders, car rides, and movie tickets. You can apply for a home loan, open a bank account, and take college classes, all in the palm of your hand.
M-commerce matters because mobile is rapidly becoming the primary way consumers connect online. Whatever your business, your customers – in every demographic – are mobile device users.
According to recently updated figures from the Pew Research Center:
- 96% of Americans own a cell phone of some kind, and 81% own a smartphone. That second number is up from 35% in 2011.
- 52% of Americans own a tablet computer.
- Close to one in five Americans only use a smartphone to access the internet at home. This is especially common in younger age groups.
Is it Enough to Have an E-Commerce Website?
If you’ve ever tried to navigate a desktop-sized website on a phone-sized screen, you know how frustrating it can be – so much scrolling sideways and the pinch and zoom is the worst! Bad shopping experiences are bad for business.
If your e-commerce site is stuck in the desktop-based past, it can drive away customers who prefer to shop on their smartphones and who have a low tolerance for unwieldy design. Sales conversion rates on mobile sites are much lower than on desktop sites for this reason. Consumers like to browse on their mobile devices, but when it comes to buying, they tend to prefer the more fluid checkout provided by well-designed desktop sites.
If mobile users keep abandoning their carts on your e-commerce site, it may be because the site hasn’t been optimized for a smooth, accessible mobile experience.
Some general pointers, though:
- Think about loading speed. Slow sites are a major turnoff to impatient consumers.
- Focus on the checkout process. Remove unnecessary form fields and irritating extra steps.
- Include essential elements (such as the shopping basket) “above the fold.” The less scrolling required, the better.
- Don’t require registration. When you’re shopping standing up on a busy commuter bus, do you really want to have to go through a multi-step registration process?
An alternative to the mobile-optimized website is the progressive web application (PWA). Progressive web apps function and appear similar to native apps (such as those you would install from the App Store or Google Play), but they run within web browsers.
Progressive web apps allow retailers to provide an app-like mobile experience without the friction of a download. Elements load quickly and respond instantly to touch. PWAs can even send push notifications and can include offline functionality.
Progressive web apps might as well be the way of the future. Already, a number of mega-brands such as Staples, Target, and Walmart have turned to PWA technology to slash loading times and unify mobile and desktop shopping experiences.
Smaller businesses appreciate how PWAs can be deployed quickly without working through an app store and how their customers always have the most up-to-date version of their app.
Do You Need a Mobile App to do M-Commerce?
Not too long ago, apps (the kind you download and install) offered more functionality and better mobile experiences than websites. But thanks to improvements in mobile optimization and technology like PWA, web-based apps can do just about anything native apps can do.
This is good news for e-commerce retailers because convincing customers to download, install, and keep your app can be a tough sell. A 2015 study found that only 39% of consumers said they had more than three commerce apps on their phones, and 21% had none.
A more recent report is somewhat more encouraging for mobile-app enthusiasts; the average phone now contains four shopping apps. Still, consumers are quick to delete retail apps to free up space or because of poor experiences. The takeaway is that mobile apps can be worth the investment if they provide value to users.
When Is an App a Good Idea?
Native mobile apps are not typically the first choice of consumers encountering a brand for the first time. Consumers are more likely to perform a web search for a product or store than to download and install an app.
On the other hand, consumers who use mobile apps tend to be loyal. Shopping and e-commerce apps have higher retention rates than all other categories.
It makes sense when you think about it. If someone is going to go to the trouble of searching for, downloading, installing, and dedicating storage space to a retail app, it’s likely because they have an existing relationship with the brand. Mobile apps are a good way to encourage customer loyalty and amplify it with helpful features, a pleasant user experience, and reminders, such as push notifications.
Mobile apps continue to outpace web apps when it comes to advanced features (although, as we noted, PWA is helping websites catch up). Some of the emerging mobile possibilities we describe below (such as augmented reality) are currently easier to implement using mobile apps.
The (Near) Future of Mobile Commerce
So far, we’ve covered the current state of mobile commerce. What’s next? The next decade promises to be the era of m-commerce. Here are some of the trends and technology we believe will power it:
Multi-channel retail is simply selling your products and services via multiple channels: online, in stores, from a mobile app, and so on. With omni-channel retail, the idea is to tie it all together to provide a cohesive experience however a customer interacts with your brand.
When was the last time you just showed up at a store with a type of item in mind, browsed the offerings, and left with a purchase? More likely (and depending somewhat on your age) you researched products ahead of time online, or you pulled out your phone at the store to read reviews and compare features. Or maybe you discovered a product because someone recommended it on social media.
Shopping, these days, can involve a range of devices and information sources. An omni-channel strategy means participating in and shaping the process across the whole spectrum.
Consumers are beginning to expect a unified experience across channels. For example, if you register an account through a store’s website, you would expect the same login information to work on the app. If you order an item online, you would expect to be able to exchange it in a store.
- 73% of consumers shop across multiple channels (according to a study published in the Harvard Business Review).
- According to Salesforce, 75% of consumers expect consistent experiences across channels, and 73% would switch brands if they don’t get it.
- Omnisend compared single-channel marketing campaigns to omni-channel campaigns and found the single-channel campaigns retained 34% of customers, while the omni-channel campaigns retained 66.12%.
Mobile devices are the linchpin of omni-channel retail; they are the one channel that stays with a consumer wherever they go. One survey found that nearly 60% of U.S. smartphone users have used their devices in stores to compare costs or look for deals. Nearly half have shared pictures of products to solicit feedback from family and friends.
What if your brand was delivering coupons directly to customers when they entered a retail location? What if customers could use your mobile app to take and share photos of your products? Those are both examples of omni-channel retail.
HubSpot has a good roundup of omni-channel efforts by leading brands. They include:
- Starbucks, which lets customers refill and monitor their rewards cards by phone, web, app, and in-store. Synchronization is simultaneous, so you can add money to your account while waiting in line and use it when you reach the register.
- Timberland, which lets customers look up product information using special NFC-enabled tablets in-store. Personalization software helps lead customers to products that match their individual style.
- Walgreens, which lets customers check and refill their prescriptions via an app, saving a potentially uncomfortable call to the pharmacist.
Entering credit card information on a tiny touch keyboard can be frustrating – doubly so when you’re on the go and not really in a position to whip out your credit card.
According to some prognosticators, however, the physical payment card may be in its dying days. Wallets themselves may be replaced by smartphones.
The decline of physical cards is an opportunity for mobile commerce retailers. Instead of asking buyers to enter a string of numbers and an expiration date each time they make a purchase, you can let customers check out using one of a growing number of popular mobile payment apps.
Payment apps such as Apple Pay, Google Pay, and PayPal are accepted by a wide range of online and in-store retailers and can link seamlessly to bank accounts.
Some retailers are experimenting with their own mobile payment systems. Starbucks (again, a leader in mobile commerce) actually boasts the most popular mobile payment app in the country – even though it can only be used in the coffee giant’s stores.
If brick-and-mortar shopping has any advantages, it’s the ability to see and touch products up close, give them a test run, and try them on, all without spending a dime. Conversely, one of the main advantages of e-commerce is the ability to receive orders quickly, try them in the comfort of your own home, without any sales pressure, and return them easily.
Mobile tools are helping retailers bridge the “try on/try out” gap with augmented reality (AR). Augmented reality refers to “augmenting” real-world images and environments in real-time with digital information. If you participated in the Pokémon Go phenomenon a few years ago, you’ve experience augmented reality.
Smartphones and tablets are the ideal implements for delivering augmented reality experiences. They’re portable, they’re equipped with high-definition cameras and increasingly powerful processors, and everyone has one.
If you sell furniture, augmented reality could let your customers envision your products around their homes – no heavy lifting required. Ikea launched such an app in 2017.
Other innovative uses of augmented reality in mobile commerce include:
- Trying on glasses using the Warby Parker AR app. The disruptive eyewear brand relies on the face-mapping technology in Apple’s newest iPhones to get a true-to-life fit.
- Taking a look inside the bodywork of a car in a Toyota showroom. Toyota’s AR app overlays an image of the vehicle’s drivetrain, with hotspots interested buyers can tap to learn more.
- Testing out makeup with Sephora’s Virtual Artist app.
As commerce goes mobile, so too – unfortunately – goes fraud. Mobile transactions account for a staggering percentage of all fraudulent transactions. And all indications are, mobile fraud will continue to rise.
Fraudsters see mobile devices and their users as ripe targets for techniques such as phishing and chargeback fraud. Criminals can physically steal smartphones, and if the phones aren’t adequately protected, use their mobile payment apps to make unauthorized purchases.
In 2015, hackers discovered a way to use the Starbucks loyalty app to siphon money from the bank accounts of unsuspecting coffee fans. (Weak passwords may have caused the problem.)
In mobile commerce – as in any other form of commerce – success depends on securing the trust of your customers.
Smartphones are our most personal devices. In a way, they contain our memories and our money, and they serve as critical connections to the most important people in our lives. When customers install your app or visit your mobile site, they need to feel they can count on you to protect what is most precious to them.
Any mobile commerce strategy should include a consideration of the fraud risks and a plan to keep your customers and your business safe. That may mean working with fraud protection experts who understand the mobile landscape, not just as it is today, but where it is going.