The Rise of M-Commerce: Why the Smartphone is the New Storefront
By Rieva Lesonsky
In the past 50 years the retail business has undergone a series of transformations, from neighborhood stores to malls and back to Main Streets again. But perhaps the biggest change is the one that’s happening right now—as more and more retail sales come from the web. And the fastest-growing part of e-commerce sales is from mobile-commerce. In fact, according to Statista, by 2021 54% of e-commerce sales will be from mobile devices. M-commerce sales are expected to more than double from $207 billion last year to $420 billion in 2021.
This is going to be a good year for all kinds of commerce, whether in-store, online or specifically mobile. Matthew Shay, president and CEO of the National Retail Federation (NRF) says, “We believe the underlying state of the economy is sound.” The NRF forecasts 2019 retail sales will increase between 3.8% and 4.4% to more than $3.8 trillion. Online sales will grow 10%-12 percent, totaling $751.1 billion and $764.8 billion.
This is good news for small business owners—if you’re prepared to sell, the way consumers increasingly want to buy—from their mobile devices. The NRF says, “Smartphones are driving retail sales more than ever, and retailers have found that even modest investments in mobile initiatives can result in huge returns.”
Mobile is the new storefront
There’s been a noticeable shift on main streets and malls all across the country. From 1990 to 2017 there was decline in the number of stores selling sporting goods, furniture, shoes, hardware and books. That doesn’t mean consumers aren’t buying these products; they’re just increasingly buying them online.
Who are these mobile shoppers? Just about everyone. Dynamic Yield reports 76% of shoppers shop on mobile because “it saves them time.” These are valuable customers—according to Invesp consumers who shop online using mobile devices spend twice as much than those not buying on mobile devices.
Mobile shopping is not just for consumers. A report from Think with Google and Boston Consulting Group (BCG) shows:
Consumers are researching their potential purchases before they buy. According to Think with Google, “no decision is too small for curious consumers. They use search throughout the decision-making journey to get advice on purchases.” And most of that research is taking place on a mobile device. In fact, 75% of smartphone owners turn to search first in their moment of need. By the end of 2019, Google expects 142 billion searches via mobile, up from 82 billion in 2015. Mobile search is so habitual now that 60% of in-store shoppers would rather look up info on their mobile devices than talk to employees.
And the good news is 80% of mobile searches lead to positive consumer action.
Improving the mobile shopping experience
Even though m-commerce is rapidly growing, consumers think there’s room for improvement. According to Google, over 40% of consumers prefer to complete their entire shopping journey on mobile. But mobile conversions are still lower than desktop because the mobile user experience is subpar.
Dynamic Yield reports only 12% of consumers say shopping on the mobile web is convenient and 90% of shoppers believe mobile shopping experiences can be improved. Some of the improvements they’d like to see include:
Mobile shoppers are not patient. Google says on average it takes 15.3 seconds to fully load a mobile page, but 53% of mobile site visits are abandoned if pages take longer than three seconds to load. For retailers, a 1-second delay in page load times can impact mobile conversions by up to 20%. And about half of consumers won’t buy from a business again if they had an interruptive mobile experience.
If you’re worried about the speed of your mobile site, check out Googles Test My Site tool. This metric is particularly important since mobile page speed is now a ranking factor on the search engines.
What consumers want
Consumer expectations have increased from the companies they do business with. GlobalWebIndex says consumers want:
But free shipping is the number-one factor in getting consumers to buy online. According to Mintel, 48% of consumers will spend more to reach free shipping minimums. The latest issue of NRF’s quarterly Consumer View report says 75% of consumers surveyed expect free delivery—even on orders under $50. And offering free shipping is no longer enough—it needs to be fast. Some 39% of consumers expect free two-day shipping, and 29% have backed out of a purchase because two-day shipping wasn’t free.
Mobile shoppers are looking for deals. According to ThinkMobiles 67% of smartphone shoppers and 52% of tablet shoppers want “money-saving offers,” including coupons, rewards and discounts.
The use of voice assistants is rapidly rising. Recode reports that 77 million adults use voice assistants in their cars at least monthly. And “smartphones, with their near universal adoption, are the biggest source of regular voice assistant u....” Even more people—90.1 million smartphone owners use voice assistants (Siri or Google Assistant) at least once a month, according to Voicebot, but car voice tech tends to be stickier.
Going mobile is crucial for small businesses. But how do you get consumers to your sites? According to the Adobe State of Digital Advertising report: social media is three times more likely to drive visits from non-customers to retailers and 69% of retail web visits are direct or search-generated for non-customers; 20% are email-generated for existing customers.
And in a turnaround from just a few years ago MediaPost reports consumers prefer texting over email for communicating with businesses — by a wide margin. However, the State of Texting study from Zipwhip says only 39% of companies text customers. Zipwhip says, “more businesses will adopt texting as they discover just how easy texting-for-business software is to implement…and use daily.”
Zipwhip says 41% of consumers surveyed respond to a business email within an hour, while 74% answer a text from a business within an hour. Texting, like social media, cannot be “broadcast.” About 76% of consumers get frustrated when they can’t respond to a text. Zipwhip says, “one-way messaging doesn’t work.”
Being mobile-savvy is imperative if you want to succeed. Amy Pascal, VP and head of U.S. marketing for Lego says businesses must have a clear understanding of how mobile has changed the way people navigate the world. And, she adds, “If you…can’t provide that service to them when they want it, they will move on quickly.”
To learn more join the Verizon Business Markets webinar on March 20 at 2:00pm EST.
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