Despite the undeniable surge in adoption of smartphones and tablets over the past five years, until recently any talk of the impending tidal wave of mobile commerce (m-commerce) has mostly been overstated. As we often see with forecasts about emerging technologies, a sense of irrational exuberance can cause predictions to get out ahead of the realities of consumer behavior.
But this past year appears to be an inflection point, with many consumers now expanding use of their mobile devices for more advanced functions – including digital commerce transactions. With m-commerce now accounting for about one out of every ten e-commerce dollars, it’s finally time for retailers and marketers to start paying close attention to this platform shift so they can develop strategies to meet the evolving needs of their customers.
Developing the right strategies must first begin with having the right context for how consumers are shopping and buying on their mobile devices today. With that in mind, here are 5 things that every marketer should know about the current state of m-commerce:
1 Out of Every 3 Monthly Visitors to the Average Digital Retailer Website Comes Exclusively on Mobile Platforms
Mobile Apps Drive Smartphone Retail Engagement, While Mobile Browsing Wins on Tablets
Smartphones Drive a Higher Share of M-Commerce Dollars than Tablets, But Less on a Per Device Basis
Retail Category Browsing Can Vary Considerably by Platform
M-Commerce Spending Seasonality Shows Wider Variance than Traditional E-Commerce
With news breaking yesterday that Apple had the forethought to file a patent five years around smart home control scenarios with the iPhone, there’s no doubt that the prescient company from Cupertino has probably spent a development cycle or two – if the rumors about the iWatch are indeed true – on how a smartwatch could be a key part of the smart home.
Tired of coming home to an empty fridge an MIT grad decided to create a company that removed the effort from shopping and cooking.
It appears we've now reached a point where people are asking "Another grocery startup?" There's already Blue Apron, Boxed, and Relay Foods (not to mention AmazonFresh), and, yet, now there's another entrant in the game. Introducing PlateJoy, launching today in San Francisco and Boston.
Personalization and segmentation are key differentiators for retailer mobile sites and applications for combining in-store activity and commerce. In addition to the 39 percent of consumers that said that they were most likely to use their device for a store-related shopping trip in-store, 19 percent said that they use their device on the way to a store.
With cars that can drive themselves, it's feasible to imagine a decline in the demand for cars—families could manage much better with a single car if a virtual chauffeur helped them get about their lives. If vehicular behavior can be coordinated en masse, traffic jams could eventually go the way of the dodo. Let's start talking about the most positive economic outcomes and slowly transition into the more negative outcomes.
As a result of consumer actions, here are common responses by various channels and supporting systems.
Mobile. Retail channels are quickly deploying and upgrading mobile sites and apps.
Experimentation. There is a lot of experimentation with new channels – virtual stores, pop-up stores, in-store product customization, marketplace selling – as retailers try to find new and unique ways of reaching consumers and creating loyalty.
Social media. Social media is being used for branding and messaging as well as promotional marketing. Smart retailers are using it for direct communications and research into buying motivations.
Pricing automation. Retailers are using automation to monitor and manage price changes. Dynamic pricing software is used to execute price changes within multiple channels concurrently based on real time conditions. Changes occur constantly throughout the day.
Big data. Retailers are discovering the gold mine of information they already have about consumer buying habits. As they consolidate information from online and physical stores and learn to mine it and combine it with third party information more effectively, consumers will be targeted with more appealing, highly personalized offers.
Brands competing with channels. Major brands are getting into the retail game with both physical and online stores. Gone are the days when they worried about channel conflict. They are aggressively pursuing “lifestyle” stores rather than simply product stores to reinforce brand images. Think Apple, Nike, and many more.
Faster delivery. All channels are moving toward faster delivery in response to consumer demand. Free delivery is also the norm rather than the exception.
About 70 percent of U.S. adults have a high-speed broadband connection at home, while 3 percent go online using dial-up connections, according to the latest survey by the Pew Research Center’s Internet & American Life Project.
“We’ve consistently found that age, education, and household income are among the strongest factors associated with home broadband adoption,” said Kathryn Zickuhr, lead author of the report, which was published today. “Many dial-up users cite cost and access as the main reasons they don’t have broadband, but for adults who don’t use the Internet at all, a lack of interest is often the main issue.”
The Kroger Company is the second largest retailer in the US behind Walmart, though it owns a number of subsidiary chains as well as its Kroger-branded stores.
But as we shall see, its huge profit margins don’t necessarily translate into success in social.
Kroger generally posts one update per day to its Facebook timeline, with the focus remaining resolutely on product suggestions and coupons.
It does occasionally mix in photo galleries, questions and videos, but these are few and far between.
Most recently nearly all the content has been to promote the retailer’s digital coupons with the aim of driving people in-store, as despite its size Kroger has yet to launch an ecommerce site.
It’s probably the most heavy handed example I’ve seen of a business trying to use social to drive additional sales, as most other companies at least attempt to use social as a way of engaging with people and developing the brand identity.
Perhaps as a result of its focus on couponing and promotions, Kroger has just 580,000 fans and receives relatively few interactions with each of its posts. In general it receives a few hundred ‘likes’ and comments on each updates, though the regular ‘Free Friday Download’ posts tend to be more popular.
But despite its overt sales messages, Kroger does do a good job of responding to user comments.
It receives quite a few queries from customers asking how they can redeem coupons and the social team generally manages to resolve any issues without just referring them to a customer service hotline.
This shows that Kroger obviously understands the value in engaging with users through Facebook, however I feel that its content strategy does little to interest people unless they’re avid bargain hunters.
I also couldn’t find any particular examples of interesting or noteworthy Facebook campaigns by Kroger, so it’s fair to suggest that it’s still an underutilised medium at the moment.
The death of the PC may be greatly exaggerated, but there’s no question it’s in decline.
That’s the takeaway from market researcher IDC, which today said it expects PC shipments to drop 9.7 percent this year as customers around the world continue to turn to mobile devices including tablets and smartphones and as PC buyers in emerging markets including China hold back on their computer buying.
“The biggest news is the dramatic increase in revenue and visits on both mobile phones and tablets, 40 percent revenue increase on phones, 77 percent increase on tablets; 40 percent increase in traffic on phones and 74 percent increase of visits on tablets,” said Ken Burke, founder and chairman of MarketLive, Petaluma, CA. “The revenue was driven by big improvements in conversion, 24 percent increase on mobile, and abandoned checkout rates, decreased by 2 percent on mobile, 4 percent on tablet,” he said.
More Than a Third of Visits to Top E-Commerce Sites Come Exclusively From Mobile
While the "Year of Mobile" remains elusive for advertisers, it appears to have already arrived for e-commerce. Smartphone and tablet users are more likely to visit a retail website or app than desktop computer users, and more than a third of visits to the top 50 e-commerce sites come exclusively from mobile devices, according to a new study from analytics firm comScore.
In June, 91% of tablet users and 90% of smartphones users accessed a mobile e-commerce web properties. That's compared with the 78% percent of desktop web users that accessed e-commerce sites. The importance of e-commerce on mobile devices is further reinforced the study's finding that 35% of visitors to the most popular e-commerce sites only access those websites from mobile devices.
New channels are being created because of mobile devices and related technologies. Payment tools like Square turn any smartphone into a payment system for only 2.75 percent of the transaction: No more merchant accounts, delays in payment, or onerous credit card statements to understand.
Mobile apps allow restaurants to further develop their take out or delivery businesses. The list goes on.
Popup and mobile stores. Buy a trailer, set up merchandise, and go to a show. It’s never been easier to move goods around. We will likely see a Renaissance in physical marketplaces. Look at all the upscale mobile restaurants launching in major cities. No more day-old burritos in foil. They make them fresh in their mobile kitchen.
Virtual stores. I previously mentioned the used of touch screens to create virtual stores. Think of an isle in a store that is represented digitally rather than with physical products. Companies could offer this for certain categories rather than stocking slow-moving inventory. You’ll have the same experience you do online — product descriptions, reviews, zoom images, alternative images, and videos — only it will be online in a store, or in a train station or a lobby of an office building
Kiosks. Kiosks have already made a huge impact in malls. Expect them to take even more advantage of the virtual store concept and expand the products they offer.
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