M-Commerce: 12 Essential Facts for 2012

m-commerce shopping

Photo by John.Karakatsanis on Flickr

Just as e-commerce changed the consumer landscape, m-commerce (shopping enabled or enhanced by mobile devices) promises to permanently alter how people shop and buy.

Here are facts hand-picked from the latest research to help you understand the shift to m-commerce and prepare you to develop an effective mobile strategy for your business.

Smartphones have gone mainstream, and tablets are catching up quickly. Almost half of U.S. mobile subscribers now own smartphones (Nielsen), and eMarketer expects iPad penetration in the US will nearly double from 12% of internet users in 2011 to 22% in 2013.

Mobile commerce is growing at breakneck speeds. U.S. mobile commerce sales (including travel) grew 91% in 2011 from 2010 to $6.7B and are forecasted to grow to $31B in 2015 (eMarketer).

Tablet owners really love to shop. 77% of consumers who own a tablet use their devices to shop (PriceGrabber). And tablet visitors to retail sites spend over 50% more per purchase than visitors who use smartphones and over 20% more than visitors who use desktop/laptop computers (Adobe).

Mobile shoppers tend to be younger and more affluent. 61% of US consumers who access mobile shopping content are under the age of 34, and 48% of US consumers who access mobile shopping content earn over $75,000 per year (Interactive Advertising Bureau).

Mobile shoppers prefer desktop, tablet, and mobile-optimized sites to mobile apps. In a survey sponsored by Zmags, just 4% of respondents said they prefer to shop via mobile apps (Zmags).

But many merchants aren’t prepared. 51% of smartphone users are more likely to purchase from retailers with a mobile-specific website, but only 4.8% of retailers have a mobile site (Microsoft).

Most mobile shoppers use their phones to research, but many will buy. The majority of consumers find comparing prices and product research the most convenient part of mobile shopping (JiWire), but 41% of those who use their smartphones to help with shopping make a purchase directly on their device (Google)

Mobile commerce can drive in-store sales. 46% of those who use smartphones to research products make their purchases in stores (Google).

But some mobile apps can cause problems for stores. 16% of U.S. mobile shoppers used the Amazon Price Check app during the 2011 holiday season (BIGInsight).

Use these industry statistics as a starting point, but consider talking to or observing your own customers before placing any bets, either directly or with a research partner. There’s still a lot of room for testing and learning in mobile commerce.

All facts were aggregated through Factbrowser (www.factbrowser.com), a research discovery engine that helps you  keep up with all the latest research on Mobile and Mobile Commerce.

3+ facts to consider before launching a mobile app in 2012

According to Forrester, the global penetration of mobile Internet users will exceed that of PC-based Internet users in 2016.  Companies across all industries are understandably trying to meet the rate of mobile adoption by developing mobile sites and apps as quickly as possible. The rapid adoption has also meant that what was true last year for developing a mobile strategy, may not be as pertinent today.  The following are a few facts that we think are important to developing a mobile strategy in 2012.  To find more facts like these, you can also visit Factbrowser’s mobile page and narrow down by industry or demographic.

Although 9% of mobile shoppers have used their phone to pay at the register, 71% of app downloaders are interested in a payment app (Nielsen)

Apps should provide a clear use-case. To understand that use-case, it’s worth taking a look both at  how apps are used today and how shoppers indicate they would like to use apps.  In retail for example, top activities among mobile shoppers include in-store price comparisons (38%), browsing products by mobile Web or apps (38%) and reading product reviews (32%) (Nielsen).

The same Neilsen study however showed that despite the fact that only 9% of mobile shoppers have used their phone to pay for a purchase (think buying a cup of coffee at Starbucks by scanning your phone), the survey respondents were overwhelmingly in favor of such a use-case. Demonstrating a clear demand as more apps roll out mobile-payment features.  Prior to launching an app do some research to get a sense of the current use case in your industry and where user-interests may be headed.  You can start by going to Factbrowser’s mobile feed and narrowing down by the industry tag on the left -hand side.

In-app purchases will account for 64% of total app market revenue in 2015, up from 39% in 2011 (iSuppli) 

When the app store first launched, creating a paid version of your app was the only way to make money off of it.  This was a problem in particular because paid apps lag so far behind free apps in terms of downloads.  In fact, according to IDC, Free apps comprise 85% of the total app market. Due to a loosening of policies in the app store and some technological advancements, free apps have started to have the ability to provide upgrade opportunities and additional purchases within the free app itself.  Games initially led the charge with in-app purchases, enabling users to buy “currencies” or additional game materials inside the free game. In-app upsells however have steadily grown as a revenue model and according to iSuppli, are on track to account for the majority of all app market revenue in 2015.

80% to 90% of apps are eventually deleted (Mobilewalla) 

That fact sounds jarring, because it is. Today’s app market features a great deal of trial and error.  Or perhaps more accurately, trial, error,and deletion.   A deleted app isn’t a sign of a lost customer, but more likely, an app that didn’t provide enough unique value.  Localytics ran a great study earlier this year on app usage after download. The company, which provides real-time app analytics, studied the thousands of Android, iPhone, iPad, BlackBerry and Windows Phone 7 to determine how frequently apps were used after the initial download. The result? Only 26% of downloaded apps were used more than once.   So what does this mean?  The first experience counts. A lot.  You don’t have a lot of runway when it comes to launching an app that gets traction.  Focus on getting the experience right.  Keep it clear and compelling.

There’s a lot more research out there to consider.  If you’re looking to a mobile app launch this year, take some time to get a sense of the field and figure out how your app can advance it.  It’s an increasingly crowded space, but apps that are truly useful and well executed will thrive.