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Archive for the ‘Mobile Commerce’ Category

As consumer confidence in mobile grows, so does mobile-originating traffic to retail Web sites. In fact, according to a June 2014 comScore report, fully 60 percent of digital media time spent online by consumers is originating from smartphones and tablets, a figure that has increased 50 percent over 2013.

In February of this year, an inMobi study showed that only 11 percent of consumers report accessing the Web mostly from a computer. A recent index of 350-plus retailers saw a same-store year-over-year increase in mobile commerce revenue of 102 percent.

Any online retailer that does not yet have a mobile commerce site is now way behind the curve and is potentially losing money every day.

Mobile commerce is hotter than a five-dollar pistol and offers some tremendous opportunities for retailers who are ready to take advantage. But pitfalls also exist.

Here are five things that online retailers should not do this holiday season if they want to take maximum advantage of the mobile revolution that is transforming the retail landscape.

1. Do not treat mobile as a shrunken version of your main site
While it might be fine for a tablet, serving a resized version of your main site to your smartphone traffic can kill conversion rates and disappoint your customers.

Responsive design has been pitched as a way to display your main site on any screen, but cramming large images and content into the mobile context slows page-load speeds to a crawl, hurts conversions and causes bounce rates to surge.

Responsive design might work fine for content sites, but retailers should not expect a shrink-to-fit approach to satisfy an increasingly savvy mobile consumer base.

Internet Retailer reported in June that, among 12 top-tier responsive mobile sites, the average page-load time was more than 18 seconds.

From the article, “A one-second delay in Web site page load time translates into a 7 percent loss in conversions, according to research firm Aberdeen Group Inc. So if an e-retailer makes $100,000 a day from its mobile site, a one-second page delay could mean around $2.5 million in lost sales every year. If that’s the case, what does an 18-second page load time mean?”

Adopting a mobile-first methodology means you end up dumbing down your ecommerce site to ensure that pages display fast and well. Throwing out the ecommerce baby with the mobile bathwater is not the answer.

Smart retailers see mobile as just what it is: a separate channel with separate use case scenarios that should be treated as such.

Unshackling your mobile site from your ecommerce site pays off with big dividends, in direct proportion to the size of your mobile audience.

2. Do not over-deliver to your mobile homepage
Why would you deliver all your traffic to the same page universally when that traffic might very well be originating from a link that is very product-specific?

Deep-linking is a must these days, and allows smart retailers to sharpen the path to purchase and reduce friction.

While deep-linking a tweet, Facebook post or even a scanned physical QR code to a product detail page and tracking everything is a great first step, mobile landing pages are an even better approach.

Large brands are using branded, custom-designed mobile landing pages to immerse consumes who are pre-qualified to be interested in a certain item. These pages feature omnipresent “Buy Now” buttons to capture the intent to buy without making the consumer scroll and click all over to purchase the item.

If well designed with an easy path to purchase, mobile landing pages can deliver conversion rates many times the rates associated with normal mobile site traffic, since they deliver the consumer to the sweet spot of the mobile commerce site.

3. Do not set it and forget it
Simply having a mobile commerce site is not good enough. It is the bare minimum ante. Retailers should always be iterating and tweaking and even fully re-designing mobile commerce sites on a periodic basis to take maximum advantage of this new sales medium.

Again, mobile is not the same as ecommerce and different things work for different reasons.

Evaluating analytics to identify a mobile commerce site’s top five friction points and fixing them is a great first step.

Often a pop-up email modal or some other gimmick that works well on the ecommerce site will cause mobile consumers to instantly abandon the site. This is another reason why responsive sites tend to under-perform.
Mobile is different and it should not be assumed that what works on your main site works on mobile.

Test, iterate, re-test and refine the mobile experience to ensure you are always increasing your conversion rate and decreasing your bounce rate.

Do not be afraid to embark on a site redesign.

4. Do not ignore mobile wallets
While most press these days is around in-store mobile payments (think Apple Pay), remember that mobile wallets can also serve as friction-reducing tools for mobile commerce sites, allowing a customer’s address and payment information to be auto-filled in.

The checkout process can be a bit tedious on a smartphone, and tools such as Google Wallet and PayPal Mobile Express Checkout allow a customer to pour in their payment information and ship-to address in a single click. The upside of adding this feature can be very significant.

Rockport was the first online retailer to use Google Wallet for its mobile site and has since reported that nine out of 10 consumers who start the checkout process with Google Wallet continue through the process and checkout. When you compare this to an industry average for converted purchases, the upside is beyond obvious.

In 2013, a study by Jumio reported that $15.9 billion in mobile commerce sales were left on the table for that year due to a 97 percent average cart abandonment rate for mobile.

Sure, things are busy and it takes time to add any new feature, but something that can significantly boost your conversion rate usually comes with a rapid ROI and is well-worth doing.

5. Do not forget your physical stores
Smartphones are in people’s hands and are always on. Too often, the commerce team that handles the mobile site and the marketing teams that handle the in-store experience and display are siloed off from one another. These teams should be meeting, talking and finding ways to use in-store mobile engagement to further both their missions.

Consumers in a store are highly pre-qualified to be interested in your products. Mobile engagement can mean the difference between knowing nothing about your store visitors and adding them to your customer logs.

QR codes, NFC and SMS can all be used to deliver a link to an interested consumer that can trigger the launch of a page custom-designed to receive this traffic.

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This article was the lead story in Mobile Commerce Daily on October 24, 2014. Wilson Kerr is vice president of business development and sales at Unbound Commerce, Boston. Reach him at wilson@unboundcommerce.com.

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The hype about mobile responsive design reached a crescendo about a year ago and it’s easy to see why. On the surface, the pitch resonates. Why manage multiple sites when you can manage just one and have it resize itself for all channels? Simple, right? Not so fast.

When mobile only made up 5-10% of a retailer’s traffic, the pitch resonated, but the flaws in this approach have been exposed as mobile commerce has grown far-faster than predicted and has evolved into a unique channel that drives significant revenue for retailers.

The notion of “one web” for all audiences might suffice for content sites like newspapers or magazines, but, for retailers, the mobile channel now deserves more than a reformatting of a desktop site, shrunk to fit a smaller screen.

Some Serious Numbers

According to comScore, mobile traffic now makes up 33% of all digital traffic for Wal-Mart, 33% for Best Buy, and 37% for Target. These are some serious numbers and for online pure-plays they are even higher (and increasing fast).

And it’s not just traffic. According to eMarketer, 2013 mobile sales are up 68% over 2012. Deloitte just reported that almost 70% of US smartphone owners intend to shop on their smartphones this Holiday Season, with smartphone market penetration now over 60%.

According to IMRG/Capgemini, mobile commerce made up 23.2% of all Q213 online sales, yet only 51% of smartphone owners reported making a purchase in the last 6 months. This means we are only seeing the tip of the mobile commerce iceberg. eBay alone will exceed  $20B in mobile sales this year.

As traffic and resultant revenues skyrocket, mobile is quickly evolving into a distinct channel that deserves to be treated as such. No longer does a “smaller copy” derivative version of an ecommerce site make the grade and retailers are starting to notice.

The Google Factor

Google famously gave responsive a boost, when it “officially recommended” it back in 2012. But one only has to look at how Google makes it’s billions to see why. A responsive approach makes their job easier, as they can crawl and rank a single entity, versus several. Google’s main point in this same post was to recommend 1) Having a mobile site 2) supporting deep linking and 3) fast pageload speeds. All three of these points, it can be argued, actually lean toward a deep integrated approach, versus responsive.

To be clear, having a mobile-specific “mdot” site does NOT mean SEO rankings will become “diluted” or hurt a page rank. In fact, since their “official” recommendation, Google has specifically stated that a responsive approach does not benefit rankings and it is standard practice to add ecommerce page tags that instruct Googlebots regarding the fact that there is alternate content and where it can be found. In fact, Google itself uses rich mobile-specific sites, versus responsive.

The negatives of running all your channels of consumer interaction off a single base of HTML can be most-easily be seen when looking at performance rankings, as the same imagery, graphics and text used for ecommerce are re-rendered for mobile, while load times differ.

Also, a resized version of an ecommerce site means only what first exists on the ecommerce site can exist on the mobile site. This is called the “necessarily derivative limitation” and it’s key to understand. This same limitation also applies to transcoded sites, by the way.

Inextricably Intertwined

A mobile (or tablet) site inextricably intertwined with the “upstream” ecommerce site features and functionality  can trap retailers into an inability to shape the mobile site specifically for their rapidly expanding mobile customer base, to capture maximum ROI and respond to evolving mobile buying trends.

A responsive approach also means the changes made to the ecommerce site can cause problems that cascade downstream, as graphics, text and site elements meant for large-screen ecommerce often translate poorly into the smaller mobile site context. These problems are usually discovered when the new etail content is pushed live and then negatively impacts the mobile site.

Much has been made recently of a re-positioning of responsive design, sometimes called “server side responsive”. And this is often positioned as a fix to “traditional responsive” (which necessitates a site replatform). But this is really just a rebrand of the same solution, using better detection methodology to try to render different slices and dices of the site, based on the device detected. The essential limitation remains. It cannot exist on mobile if it does not first exist on ecommerce.

More Effort But The Payoff Worth It

Building and managing a site built specifically for the mobile channel might take a little more effort, but the payoff is that a retailer can tailor the mobile site experience for maximum effect by adding mobile-specific features and functionality catered to a growing mobile audience.

And there are real examples. IR 500 retailer Finish Line was quite open about the foray it made into responsive, as an element of their ecommerce replatform, taking the unprecedented step of announcing a $3M loss associated with the botched transition. And an increasing number of large retailers are investigating ways to unhinge responsive mobile sites from upstream etail functionality.

An alternative to a “derivative” responsive mobile site (and certainly a transcoded site) is one based on a deep integration with an ecommerce infrastructure using API calls. The template for the mobile site is unique and built from “whole cloth”, using best practices specific to the mobile channel. Data (price, size, sku, color, availability, imagery, etc.) flows seamlessly in real-time from current ecommerce operations and is cached locally. Third party services are integrated and the software that powers the site can be licensed and hosted by the retailer, in-house. Promotional images are designed specifically for the mobile channel and loaded via a control panel dashboard.

In this way, current ecommerce operations are leveraged and extended into mobile, while the retailer has the freedom and flexibility to offer mobile-specific features and functionality designed to drive mobile revenue. And they have full in-house control of the entire site.

Up to 6X Faster

An independent survey of mobile commerce sites conducted by Marlin Mobile showed API-integrated sites load up to 3X faster than transcoded sites and up to 6X faster than responsive sites. Industry-wide conversion rates for all mobile sites in their totality lag behind ecommerce, so reducing friction and ensuring optimal performance is an imperative.

A deep integration approach also does not necessarily mean more work for the retailer’s IT team. While this is a common refrain among responsive solution providers, the fact is that, once APIs are mapped for a specific ecommerce platform, this “pre-integration” can be applied to all retailers using it, with tweaks and additions made to link up 3rd party services like recommendations or reviews.

Pageload time rating

IT Involvement: More Is More

Also, it is increasingly viewed as a positive to have the merchant IT involvement, as more and more retailers want the option of licensing the software and running mobile on their own servers, to take technical and creative control of a channel that’s responsible for an ever-growing percentage of revenue.

Mobile buying behaviors are different and the channel is different, and, as it grows rapidly, smart retailers are untethering the mobile experience from their ecommerce site functionality, to take maximum advantage of mobile commerce in ways only just starting to be understood.

 

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The Other Day I Scanned A Banana (The Good

Yes, that’s right, a single, offline, real banana. Latin name Musa Acuminata. More specifically, I used my smartphone to scan a sticker on the banana. The banana itself had no power supply, or web connection.

I happened to buy this particular banana at a Wal-Mart in Florida (while on a fishing trip) and noticed that the ubiquitous banana “fruit company” sticker contained a mobile quick response (QR code).

I opened the scanner on my iPhone and scanned the code. In doing so, I opened a portal to the internet, a live action window into an online mobile-optimized experience that taught me something new. That engaged me. Cool.

The Del Monte QR Code

Seldom had I considered what company grew and shipped and sold the bananas to the grocery store I bought them from. Did you know that the Del Monte Fresh Produce Company was founded in 1886? (This is the year Apache warrior Geronimo surrendered and the Statue Of Liberty was dedicated). Did you know that Del Monte has 42,095 “likes” on Facebook and that they also sell a fruit called a Pluot? Did you know they own the domain http://www.Fruits.com?

Well, now you do, because I learned this on the Del Monte mobile-formatted  Facebook page that opened when I scanned the QR code.

Where I Landed When I Scanned The Del Monte QR Code

It took me about 5 seconds to scan and engage with the company whose product I was about to eat. It was not hard, it was easy. I would do it again.

The Other Day I Scanned A Banana (The Bad)

Yesterday I got my chance. This time I bought a banana at Wilson Farms in Lexington, MA. It too had a QR code on it’s sticker. When I scanned it with the same iPhone app, my mobile browser opened a standard large-format website for Chiquita Bananas, crammed on my little iPhone screen. Lame.

The QR code sticker said “Scan To Win!”, but I could see no easy way to sign up for anything and I could barely read the website on my small iPhone screen. I pinched a zoomed-in a few times and then shut off the phone.

The Chiquita “Scan To Win” QR Code

A Poor Experience On my iPhone

Unlike the Del Monte banana, the Chiquita QR code scan offered up a poor mobile experience and I was left with the distinct feeling that Chiquita needed a lesson in mobile marketing. Perhaps they will read this and call me.

Action-Enabling Ads…and Products

Some naysayers in the mobile marketing business scoff at QR codes as a gimmick or a passing fad. They talk about how hard it is to open the scanner app and actually complete a scan that opens a mobile browser window. I disagree. In lieu of another option that is this easy and simple, I find them a powerful mobile engagement tool.

In 2011, almost 60% of Twitter and Facebook users said they scanned a QR code. This is a LOT of people. In my opinion, any marketer or brand manager who sees this as merely a passing fad needs to open their eyes. QR codes allow a  low-cost “window to the mobile web” to be attached to anything. Nearly 10% of ads in magazines today feature QR codes that “action enable” a static, lifeless print ad and allow a tracked consumer interaction to occur.

Ninety percent of all QR code scans are done to obtain more information about the products and services advertised. If done right (like the Del Monte banana example) this can result in metrics that can justify an ad spend as ROI. This could be in the form of contest sign-ups, new Facebook “likes”, or even transactions. If done hastily and without thought to the mobile experience being provided (like the Chiquita banana), the result can be a poor customer experience and a squandered chance to engage mobile consumers.

Cha-Ching

Again, done the right way, QR codes are an easy, low cost way to add a mobile “window to the web” to any static ad or physical product, to drive consumer engagement. For print ads, custom mobile landing pages can be generated, to maintain the look and feel of the ad campaign.

If linked to an integrated mobile commerce site that supports deep linking (shameless plug for Unbound Commerce), a QR code can be a call to action that allows a consumer to convert a purchase right then and there. If a little “cha-ching” did not go off in the head of online retailers, it should have.

Low Barrier To Entry

The barrier to entry is so low, that there is little reason marketing depts should NOT be experimenting with QR codes. Smart eCommerce Directors that are launching mobile commerce sites should be telling them to, since they can use QR codes to drive tracked incremental commerce though their mobile commerce site!

The addition of a QR code can transform a static, non-linked print ad, in-store sign, or even a real product (like a banana) into a powerful engine for tracked mobile or social engagement and  commerce. I see QR codes as a viable and exciting new way to infuse tracked links into marketing, so literally anything can come with an integrated mobile call to action.

I had no idea two bananas would show me this, but they did.

Lessons

Certainly, scanning a sticker on a banana is not going to redefine mobile commerce or set the mobile/social marketing world on-fire. It is, however, a lesson regarding how easy it is to engage increasingly-mobile consumers by adding a link, a mobile call to action, that, when applied to other more commercial mobile commerce scenarios has the ability to generate real sales lift, as ROI.

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Wilson Kerr is VP of Business Development and Sales at Unbound Commerce. And yes, he is bananas about mobile commerce and mobile marketing and linking the two together. Contact him today at Wilson@UnboundCommerce.com or via Twitter @WLLK.

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Mobile Marketer Senior Editor Giselle Tsirulnik recently interviewed me, regarding the role that SMS can play in mobile commerce. I am re-posting this interview and expanding some of my answers.

I hope this post gives retailers and brands insights into ways that “Trigger Point Marketing ™” like SMS can be used to link tracked mobile commerce sales with the social sharing of the specifics of  a product or price, by customers. When consumers share the news about something they recently bought among their social network, the effect can be powerful, as long as retailers can track the resulting lift via mobile commerce transactions.

Here is an extended version of what I said:

Q: What is the benefit (for a brand or retailer) of having a consumer SMS/MMS a product they are viewing via a mobile commerce site,  to a friend?

A: This sort of social sharing means the retailer or brand has a new touchpoint delivered instantly to a highly prequalified audience. Since the text arrives from a trusted friend, the person who receives it is very likely to open the text, read it, and click on the link. It stands to reason that the conversion rates for the recipient of the SMS would be many times higher than traditional marketing blasts.

By providing the tools needed for consumers to repackage and redeliver a marketing message to a highly prequalified audience within their own social graph, retailers can tap into a very potent mixture of personal referrals and siphon off additional mobile commerce sales.

Q: How could this potentially drive sales for a retailer?

A: Smart retailers are increasingly offering their customers tools whereby they can share the deal they just got. Word of mouth and personal referrals consistently ranks amongst the highest-ranked reasons consumers visit a store or retail website. If the retailer has a mobile-optimized site, an SMS sent by a customer can serve as a delivery mechanism for a deep link right into the section of the mobile commerce site where the exact product that was purchased (or product grouping) is queued up and ready to buy for the text recipient. This can directly, positively impact mobile commerce sales and, more importantly, can be tracked, measured and even used as a way to reward consumers who have spread the word.

Q: Do you think more retailers will be incorporating SMS into their mobile sites in 2012?

A: Yes, retailers interested in stay relevant will utilize a variety of new ways to have hyperlinked touchpoints spread by pleased, loyal consumers.  In a few clicks, the recipient of the text message can buy the item their friend bought and also have the opportunity to pass the word along. By adding this option pre or post-purchase, retailers can infuse their mobile commerce sites with

As SMS starts to replace email with younger generations and more and more retailers build and launch mobile commerce retail sites, this method of “Trigger Point Marketing(tm)” is a great way to drive tracked ROI. SMS is alive and well and retailers should certainly add it to their marketing mix, in support of mcommerce.

Q: Why is SMS a good medium to encourage sharing?

A: An SMS text message is instant and it is personal and it generally comes from a known, trusted sender. For these reasons, a whopping 98% of all text messages sent are opened by the recipient. No other form of digital marketing even comes close.

SMS also opens up a new channel of communication between the retailer and the consumer and builds a retailers database of contacts, since the mobile commerce platform captures the mobile phone numbers of both the sender and the recipient.

Q: What are some other ways SMS can be incorporated into a mobile commerce site?

A: When integrated into a mobile commerce site as a “social share feature”, SMS can also be tapped to distribute pre- and post-purchase links to a product in a mobile commerce site, within the social graph of the purchaser

SMS can also be used, via short codes, to drive traffic to a mcommerce site, when a hot link is sent back to the consumer, by the retailer. Additionally, SMS can be used to sign up customers to loyalty programs or allow them to opt-in for announcements of new arrivals, etc. If a shopping cart is abandoned, SMS can be used to ping the customer who did not complete their transaction, to remind them that their cart is full and they forgot to check out.

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The Final Word: Mobile commerce is no longer an option for retailers and brands that sell consumer direct. Retailers that do not have an integrated mcommerce site are losing sales every minute, literally.

The linkage between proven, incremental sales and mobile marketing has long been elusive. This fact has kept a barrier up between the ecommerce team and the marketing dept. This is finally changing and the fact that socially driven messaging can be infused with deep links within a mobile commerce page means that these two worlds are finally set to merge. When this happens, marketing will be able to see a quantifiable return on their spend and the ecommerce team will have a whole new revenue stream via mobile commerce that is, in turn, supported by mobile marketing. A win-win. Remember, SMS is but one method, and QR codes and Near Field Communication (NFC) are also viable ways to drive proven, new mobile sales via”Trigger Point Marketing ™”.

The silos between marketing and ecommerce must be demolished. The retailers and brands that realize this and embrace this notion fastest will win. The rest will be left behind.

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Wilson Kerr (@WLLK) is a former Tele Atlas exec, LBS consultant, and now leads Sales and Business Development for  Unbound Commerce.

Contact Wilson today to learn more. Mobile: 303-249-2083.

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Sometime this year, 50% of Americans will own a web-connected smartphone, yet less than 20% of online retailers have websites optimized and formatted to serve these mobile consumers.

I am calling this the “mobile commerce gap”. The reason for this inequity between demand and supply, in my opinion, is because the internal resources required for online retailers to properly develop a mobile commerce site have been pulled in other directions, even as smartphone adoption rates have exploded. As a result, a majority of online retailers are offering their mobile customers a very poor online shopping experience. This, in turn, results in poor conversion rates and missed sales, not to mention the fact that consumers are left with the general impression that the retail brand is not serving their needs.

Think about it, how many times have you visited a site on your smartphone and immediately left when you saw it was not optimized for mobile? According to Google, this happens 79% of the time!


Why this “gap”? The first distraction came in 2009 when retailers and brands alike were told they must “drop everything and build  an iPhone app”. While apps are great for some things, a vast array of surveys and studies have concluded that consumers much-prefer a mobile site over an app for commerce. The second was the social media craze of last year, as Facebook, Twitter, and the rest dominated headlines and became “must-haves”. Both soaked up internal IT resources and distracted online retailers from building the mobile-optimized sites needed to serve their increasingly-mobile customers.

So, what are the factors online retailers should consider, as they investigate offering their customers the ability to convert sales from their mobile devices via a mobile commerce site? I hope the following 5 points will clear some things up:

1) There is No “Mobile Web”

While it is true that most “standard” websites are capable of being viewed on a web-enabled phone, few consumers are willing to “pinch and zoom” their way into a converted sale on a standard site jammed into a small screen. Ever tried this? It’s not fun.

While the need for mobile-optimized sites might seem obvious, many retailers justify not investing in mobile commerce by citing low mobile-originating traffic to their  current site (usually 2-5%).  Of course, this low-traffic negative feedback loop is caused by the fact that mobile customers seldom return to a site after being greeted with such a poor user experience. The retailer then concludes there is no need to invest in the “mobile web”. Again, there is no “mobile web”.  There is only the web viewed on a mobile device.

2) Mobile Commerce is NOT Mobile Payments

There is a lot of “noise” right now regarding mobile payments at point of sale, when the phone is used as a “mobile wallet” to pay for coffee and the like. While mobile payments might-well emerge as an issue retailers need to address, this  is not the same as mobile commerce. Mobile payments involve banks, credit cards, investments in point of sale infrastructure, coupons, NFC,  loyalty cards, and a whole array of complex issues.

Mobile  commerce is simply the act of ordering something online, from your mobile phone, via a mobile-optimized version of a website. Retailers should not confuse the two, or delay the launch of a mobile commerce site while trying to understand mobile payment options and what uniform technology may or may not emerge victorious.

3) Mobile Commerce “Actualizes” Mobile Marketing

Remember, every time a consumer clicks on a marketing or advertising link to your website on their mobile phone, they should land on a site that is optimized for the device they are accessing that message on.  Whether a tweet, a Facebook post, a banner ad, a QR code, an SMS message, or an email,  the mobile consumer who acts upon the message should be able to convert that action easily into a sale, via a mobile commerce site. If you are a retailer and do not have a mobile commerce site and are spending money on social media marketing or mobile advertising, you are likely paying to promote links to a very poor customer experience.

4) Integrate, Don’t Duplicate

There are several options for creating a mobile commerce site. You could use a transcoder to “screen scrape” your standard website and shrink it to fit a mobile screen. You could “sub-out” your mobile commerce efforts to a third party, by letting them “handle it” with their own separate and duplicative mobile store. OR you could leverage and extend your current, proven and trusted  e-commerce operations into mobile via an integrated solution. This is a superior approach, in my opinion, as it means you are avoiding duplication, while also maintaining full in-house control and fueling mobile commerce from the same infrastructure you trust today for your e-commerce operations.  A software-based integration approach takes a bit more effort on the front-side, but the long-term benefits are significant, as this single effort, if done properly, can serve as the foundation for not only mobile commerce, but also Facebook  commerce and commerce-enabled iPhone and Android apps, as needed.

5) Devote IT Resources, Plan For Growth

The single biggest reason I hear retailers give for not moving on mobile commerce is a lack of IT resources. Simply put, this is a poor excuse. While it may be true that IT is backed up, the measurable, tracked ROI that mobile commerce offers should elevate this to the top of the list. The ROI is extremely rapid, by even the most conservative estimates of the resulting tracked, incremental mobile commerce sales. Retailers and brands that are out ahead of the curve will be the biggest winners, as long as they plan for growth and chose the right approach.


Compelling Numbers

Still not convinced that mobile commerce is a “must have”? In recent weeks Google and other mobile marketing players have begun encouraging retailers to sit up and take notice of this “gap”, since they can’t sell online retailers mobile marketing campaigns if they have no place for the target audience to “land” when they click though a mobile campaign ad/link.

Google and others are pointing to studies and reports that contain numbers that are hard to ignore. Here is a sampling:

  • $1.9 Billion: Worldwide online mobile sales in 2009.
  • $23.8 Billion: Expected worldwide online mobile sales in 2015.
  • 61%: The percentage of mobile users unlikely to return to a site not optimized for mobile.
  • 79%: The percentage of Google retailer advertisers who DO NOT have a mobile site.
  • 78%: The percentage of consumers who prefer a mobile site over an app.
  • 62%: The percentage of smartphone owners who have purchased physical goods via their phone in the last 6 months.
  • 2-5%: The typical percentage of mobile traffic coming to a non-optimized retail website.
  • 5X: The typical increase in conversion rates, upon the launch of a mobile commerce site.
(Adobe-Mobile Shopper Insights, Google, eMarketer, Shop.org, Coda Research, Unbound Commerce)

Want even more evidence? I recently attended the Mobile Commerce Summit in NYC and the Keynote speaker was Steve Yankovich, VP of eBay Mobile. eBay has quietly become the largest online retailer in the world and were an early adopter of mobile commerce.

The numbers Steve shared regarding their mobile commerce success at the conference were astounding. Some highlights:

  • $4 Billion: The revenue eBay expects to generate from mobile commerce in 2011, double what they sold on mobile in 2010.
  • 100%: The percentage of eBay’s m-commerce sales they report as being incremental!
  • 38 Seconds: The average time someone spends on eBay for a m-commerce transaction (versus 20+ minutes on their standard site).
  • 100: The number of people eBay reports hiring for their mobile commerce team.
  • 50X: The predicted increase in what eBay will spend on mobile marketing to support the success they have seen in m-commerce.

We are finally at a point where the numbers are so compelling that few can argue against the importance of having a mobile commerce site. The simplest way to put this is, “If you do not have a mobile-optimized commerce site, you are losing money“.

The Time Is Now

Your customers are mobile and they are very likely trying to access your site on their smartphones right now. If they still see your “standard” e-commerce site crammed onto a small screen, you are delivering a poor customer experience and, as such, are missing incremental mobile sales. Try it yourself!

Some experts expect mobile commerce to grow to become as much as 10-15% of online sales. Retailers should weigh the risks of launching a solution that is not integrated with their current operations, since what might not be a problem at first could emerge as a big issue when mobile commerce makes up a significant percentage of online sales. Find the resources, take the time, and consider building/launching a mobile site ASAP that leverages and extends current online sales operations.

You will provide consumers a positive mobile interaction with your brand that also drives significant incremental, tracked revenue. Mobile commerce is here and the time to take advantage via a mobile commerce site is now!

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Wilson Kerr (@WLLK) is a former Tele Atlas exec, LBS consultant, and now leads Sales and Business Development for  Unbound Commerce.

Contact him today to learn more. Mobile: 303-249-2083.

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of mobile.  Contact him today to learn more.

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Over one hundred billion dollars is spent annually on “traditional” online advertising, and each of the last three years have been prematurely declared the year of mobile advertising. For too long, the promise of mobile advertising has been based on technical, location-awareness-related advances the industry has heralded as beneficial, while these same advances scared consumers away.

This is finally changing and consumers are discovering simple, easy iterations of mobile technology that provide simple, easy solutions for problems they want solved. Saving money via special offers/coupons at known, nearby business locations is the best example and Groupon and their kind have driven socially-promoted savings on purchases that can be measured in increments of $Billions.

group-buying-sites

The Bridge To Mobile Commerce: Deals and Group Buying

Groupon is the fastest growing technology company in history and Founder/CEO Andrew Mason links their success to providing a “hybrid of local advertising and local commerce”.

Groupon’s unprecedented success should serve as a  lesson to the various elements involved that melding established consumer behavior and technology in a simple, easy way that also leverages consumer acceptance of social media  is a key factor for success.

The real power of this model lies in the fact that incremental, tracked purchases are made at the beginning of the consumer interaction, generating pay-for-perfomance, frontside ROI metrics that blow other “wait and see” methods of marketing out of the water. When you add in a “social media award” component (share the deal and get the deal for free), this model becomes even more powerful, as the campaigns quickly become viral and market themselves.

While Groupon, Living Social and the rest have been written about extensively, I am not sure the full potential impact of this model is understood. These companies solve an existing problem for local businesses by converting the traditional coupons, sales, and special offers they have used for decades into tracked offers that can measure in both financial upside and foot traffic. They also tap exisiting marketing budgets by stealing pre-allocated dollars away from traditional media via no-risk performance-based value propositions (that work).

This is in contrast to much-touted hyperlocal mobile push advertising campaigns that require a problem to be explained, before a retail business or brand will considering paying to try to solve it (assuming they agree the opportunity for ROI is there). More importantly, most retail businesses still do not have a way for mobile banner click-throughs to land a consumer in a place where a purchase can be converted. This is where mobile commerce comes in.

ebayMoving The Merch: “Redemption Is Mobile Commerce”

The quote above is from Dan Gilmartin of Where.com and I agree. While redemption of printed or digitally displayed group buying vouchers brought into a restaurant, hail salon, or spa (for example) works well-enough, retailers that sell lower-margin goods want converted sales that “move the merch”, as they say. Giving 50% of your margin away to Groupon and their kind, is a fine solution for high-margin, service-oriented businesses, but retailers need to link campaigns for specials to actual sales.

Converted sales transactions, rather than impressions rendered or click-throughs to a standard website, are what attracts small to medium-sized retailers that gain little from traditional brand marketing. Since non-standardized point of sale systems for redemption are still the Achilles Heel of the mobile coupon model, tracked, mobile commerce conversions will emerge as the new, essential “redemption metric” in 2011.

With $1.5 billion in mobile sales logged in 2010 (a 3X increase over 2009), Ebay’s mobile commerce success shows that consumers are willing to transact on a mobile device. In just the 30 days before Christmas 2010, eBay transactions were valued at over $100 million  in gross merchandise value, a 135% increase over last year (Mobile Commerce Daily).

“Today’s consumers are transforming the shopping experience with their mobile phones, and retailers who have not broken down their siloed channels will not be able to keep up,” says Jim Bengier, global retail industry executive for Sterling Commerce.

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2011: The Year Of Mobile Commerce

In the rush to check off the branded app and social media platform “must-have yes boxes” , mobile commerce sites were passed over by retail brands, and consumers have been left to “pinch and zoom” and fumble with large format websites not optimized mobile devices.

How big is the mobile commerce opportunity? In July of 2010, a scant 12% of online retailers had a mobile commerce site and an even smaller 2% had an app with checkout capability (Acquity Group). Even with these dismal brand/retailer adoption numbers, US mobile-commerce (sans travel bookings) grew from $400 million in 2008 to $3.4 billion in 2010, and growth is predicted to be “explosive” in 2011 (Mobile Commerce Daily). Show me the money, indeed.

In 2011, linking a smooth-running mobile commerce engine to special offer and redemption platforms/efforts will emerge as essential, as this is the simplest way to track success in a way most retailers understand. Retailers who sell online should build robust mobile commerce sites linked to their etail “technology stack” in order to capture converted sales, driven by mobile (or social) marketing. Simply “scraping” an etail website and shrinking it to fit for mobile ignores key differences in mobile vs at-home consumer purchasing-related behavior.

Social Commerce: Sharing The Wealth

Of the 620 million consumers using Facebook, the most active 200 million access the social network through their mobile device.

Why do large retailers and brands spend money building up millions of Facebook Page fans and then drive them away from Facebook to convert a sale? It’s even worse if they send a mobile consumer to a standard website.

Increasingly in 2011,  retail brands will use Facebook to promote special deals for fans, and give them the option to buy what they are promoting by linking to a mobile commerce page where that product is cued up. Facebook might-well offer these tools for businesses as a part of Facebook Deals, as they look to emulate Groupon’s incredible success.

Social commerce will take a while to catch on, but is on the horizon. It is an extension of mobile commerce, because technical integration with the “etail technology stack” is needed to create Facebook Commerce tabs, so secure transactions can take place within Facebook pages.

The power of social commerce really shines when, for example, mobile (or Facebook commerce tab) purchases driven by special deals offered to Facebook fans can be shared within (and extended to) the buyer’s social graph, after the purchase is made.

Mobile-Payments-M-Commerce-Transactions

Tap, Tappity, Tap: NFC  Taps Established Consumer Behavior

I’d be remiss if I did not mention NFC (Near Field Communication) in this post. While mobile and social commerce are next up for online purchases on a smartphone, mobile payments at point of sale for smaller transactions will also be a hot topic in 2011. The path to a “mobile wallet” will be rocky, but NFC will emerge as the best way to both validate mobile proof of presence, and conduct small “tap to buy” transactions using value deduction from a secure, preloaded digital account contained within the device. Consumers know NFC and it is easy to use. The fact that three big US carriers have buried the hatchet long enough to line up behind NFC via the formation of Isis, is a powerful signal.

These inherently mobile “real life hot links” need to go somewhere, so NFC will support the rapid growth of mobile commerce as well. Watch for NFC tags to start appearing in pilots/tests on out of home advertising, packaging, and even wine bottle labels.

Conclusions

Mobile commerce drives revenue and location-specific redemption of special offers that can be promoted via social media marketing. Redemption takes the form of real mobile commerce transactions linked to promotions that mimic the powerful Groupon model, without giving up the margins. Mobile commerce will grow rapidly in 2011, as branded apps fade in importance, in direct proportion to increased data speeds,  accelerated location-enabled smart phone adoption/usage by consumers, and the creation of mobile commerce sites by retailers.

Facebook will increasingly play a role in every brand or retailer’s marketing plan. With 200 million accessing it via their mobile device, Facebook will become a place where discounts, sales, and special offers are  not only shared and compared, but increasingly parlayed into converted mobile commerce sales. Facebook commerce transactions that leverage this same technical backside integration and occur within Facebook will not be far behind.

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of mobile . He is also running sales for for mobile commerce solution provider Unbound Commerce. Contact him today to learn more.

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