Any financial transaction carried out on a mobile device, such as a cell phone or tablet, is included in mobile commerce, also known as m-commerce.
What is that?
The ability to purchase and sell products or services from virtually anywhere by utilizing a mobile phone or tablet is a breakthrough in e-commerce.
However, mobile commerce goes beyond being a straightforward development of electronic commerce.
It has also stimulated the development of new industries and services or assisted those that already exist to expand, such as:
- mobile money transfers
- electronic boarding passes and tickets
- delivery and purchasing of digital material
- cellular banking
- in-app purchases and contactless payments
- services depending on location
- discounts, loyalty programs, and mobile marketing.
Various Types of Mobile Commerce
Despite the fact that m-commerce encompasses a wide range of transactions, they may all be divided into one of three categories:
Shopping on the go
Most of this resembles e-commerce but is available on an iPhone or Android device. Today, mobile-optimized websites, specialized shopping applications, and even social media platforms make it feasible to purchase on the go.
Although there aren't many differences between mobile and internet banking, some transaction types could be restricted or prohibited on mobile devices. Although some banks have started experimenting with the usage of chatbots and messaging applications, mobile banking typically needs a specialized app.
Using a mobile wallet
We have decided to go into more depth about mobile payment choices in this post because there are so many different types available.
Most Common Mobile Commerce Benefits
Until recently, bigger businesses may have been the only ones with the choice of developing mobile applications and moving to mobile-friendly platforms. However, as the cost of becoming mobile declines, more and more businesses are able to profit.
Improved client experience overall
The introduction of eCommerce already marked a significant advancement in how we shop. Customers could access a broader selection of items, rapidly compare prices, and buy from the comfort of their homes if they could shop from their desktop computer rather than going into a store.
Shoppers may still perform all of these tasks today, but they only need a phone in their back pocket and don't even require a desktop computer.
Additionally, due to its very nature, m-commerce offers several possibilities that you just won't find with e-commerce:
- Mobility: While desktop computers may be taken anywhere, it's doubtful that a customer will constantly have a laptop with them. However, m-commerce makes online purchasing much more practical given that the majority of consumers never leave the home without a smartphone.
- Reach: Online businesses can reach a larger variety of customers even while they are on the go with the option to send clients SMS push alerts.
- Position-tracking: By utilizing GPS and Wi-Fi to determine a user's precise location, m-commerce applications and online shops may deliver tailored and location-specific information.
Incredible potential for development
Despite having a sizable user base already, mobile commerce is still growing as an industry.
In 2022, mobile retail e-commerce sales in the United States are projected to surpass 430 billion U.S. dollars. However, Statista predicts that by 2025, m-commerce sales will account for nearly 10% of total US retail sales, an increase of 7% percentage points from 2018.
A genuine omnichannel experience
In order to provide a seamless user experience and a consistent brand message across all touchpoints, omnichannel commerce refers to selling both in-store and online through a variety of channels – on your eCommerce website, Amazon, eBay, Instagram, etc.
But more than that, designing an omnichannel experience means going where your consumers are and making it simpler for them to make a purchase.
Mobile devices are thus the best platform for omnichannel commerce since you can anticipate that the majority of your consumers always have their mobile devices with them.
A selection of payment methods
Emerging mobile payment solutions have paved the way for a number of payment methods, including Apple Pay, PayPal One-Touch, Visa Checkout, and Amazon Pay, to make the purchasing experience more simple.
Nowadays, a lot of e-commerce websites have one-click checkout options, which let users enter their payment information just once and then use it each time they make a purchase after that.
Mobile Commerce Drawbacks
Constant optimization is required
Even if m-commerce is growing, we must not lose sight of the importance of desktop. In actuality, desktop still has a lot of benefits over mobile.
The average desktop device has a conversion rate of 3.9 percent, which is more than double the 1.8 percent average rate for smartphones, according to Retail TouchPoints.
Given that tablets held a conversion rate of 3.8 percent while other devices with smaller displays (such as smart watches) had a rate of just 0.1 percent, the difference is likely due to screen size rather than mobility.
Additionally, in terms of order value, desktop PCs outpace mobile devices by a greater margin. According to Statista, while smartphones accounted for 64% of all visitors to retail websites worldwide in 2019, they only produced 46% of e-commerce revenue, the same as desktop computers. Therefore, optimizing for mobile commerce is clearly necessary.
You will need to be knowledgeable about the most recent technology and apps as customer behavior changes in order to make sure that your online store is not just mobile-friendly but also quick, simple, and intuitive to use.
A range of payment options
Although the wide variety of payment options may be advantageous, not all payment systems and mobile wallets are accessible worldwide. Additionally, various nations' clients frequently favor particular payment methods over others, making it more difficult for online retailers to run their businesses internationally.
Even while you would believe that adding more payment alternatives would make mobile usage simpler, sometimes less really is more.
In fact, a research from 2000 discovered that providing too many product options frequently causes a decline in sales and consumer satisfaction. You should thus determine the ideal combination of payment alternatives for your industry and the regions you serve. It could seem challenging at first, but as you learn more about your consumers and their tastes, the ideal payment alternatives for you will become clear.
Makes pricing comparison easier for buyers
One of the drawbacks of making it simpler for users to use mobile devices is that it makes it much simpler for buyers to compare prices across a range of retailers fast. Customers may easily compare prices for identical products from your company and 10 others online in just a few clicks, and they frequently do so in an effort to pick the best deal.
So how can you stop it? By being aware of how you compare to your competition, just like your consumers. Keep an eye out for when competitors change their rates and delivery costs, and be prepared to respond.
In a Forrester research, 30% of smartphone users said that they avoid using their device to make online purchases because they don't feel comfortable utilizing mobile payment systems, and 14% admitted that they were concerned about their phone information being sold to other parties.
Therefore, e-commerce companies have a stronger need to safeguard and manage consumers' personal data when they grant access to it via their mobile devices.
A larger range of laws will need to be followed, but you'll also need to be open with your clients about how you're gathering and sharing their information.
Mobile Payment Types
Fortunately, there is no shortage of m-commerce payment choices from which to select.
One-click checkout has grown in popularity, but choosing which payment alternatives to provide on your eCommerce site is even more crucial for your mobile site because most customers want something that is quick and simple.
You could be on your way to increased conversions, sales, and devoted clients if you can spare your consumers the tiresome task of putting in their credit card information and personal information each time they make a purchase.
Here, we'll present a quick introduction of the most popular mobile payment options so you can choose the one that works best for your company.
Mobile wallets (aka digital wallets)
Customers may keep information about their debit or credit cards, mailing addresses, and other payment data using mobile wallets. So, customers can swiftly and comfortably checkout with just a few clicks rather than having to laboriously re-enter card information and personal information each time they make a purchase.
For one-click checkout, US clothing company Natori, for instance, employs PayPal One-Touch. Among the most widely used mobile wallets available are these:
- Apple Pay
- Google Pay
- Amazon Pay
- Samsung Pay
Contactless mobile payments
Contactless mobile payments employ mobile wallets to enable payments in-store to improve the omnichannel experience.
Customers may use their mobile wallet to make purchases in physical stores if they have already entered their payment information into one, often Apple Pay, Google Pay, or Samsung Pay. To authenticate and send payment, all users have to do is put their phone next to a compatible terminal rather than using a credit or debit card or cash.
Mobile closed-loop payments
Similar to mobile wallets, closed loop mobile payments allow customers to submit their payment information just once rather than every time they conduct a transaction.
Closed loop payments, however, are solely connected to one specific brand's mobile app. Customers have the option of loading funds into a spending account or gift card, which allows them to check their balance, add additional funds, and make payments online or in-person.
Several well-known instances of closed-loop mobile payments include the following:
- Walmart Pay
- Taco Bell
You can see in the example below how Atlanta Light Bulbs uses this payment option to streamline the purchasing process for clients and speed up the payment process.
Users now have the choice to rapidly and securely transfer money using a variety of venues, as opposed to doing it through mobile banking apps:
- Cash App
- Facebook Pay
Mobile point-of-sale (POS).
A smartphone, tablet, or other mobile card reader that can process transactions wirelessly serves as a cash register is known as a mobile point-of-sale system.
Smaller businesses might consider using mobile card readers since they are convenient and reasonably priced, and all you need is a mobile smartphone. Some of these systems even link with various eCommerce platforms, allowing you to instantly sync inventory and sales between your physical stores and online ones.
Here are several well-known mobile POS solutions that you may test out:
How Page Speed Affects Mobile Commerce
Page speed has always been a factor in how well-ranked an e-commerce site will be on Google for desktop computers; the quicker the page loads, the better.
However, Google recently made the switch to a mobile-first index in light of m-commerce, which means that online retailers that are optimized for mobile devices would naturally rank higher than those that are not.
Page speed, of course, has an impact on more than simply SEO ranking.
A Google study found that for every couple of seconds that the page takes to load, the likelihood of a bounce rises sharply.
Choosing Between a Mobile App and a Mobile Website
By 2020, eMarketer predicts that individuals will spend more than 4 hours per day on mobile internet, with apps accounting for 88 percent of that time rather than mobile browsers. Not to add that mobile branded applications account for around 70% of revenues.
Why is that so?
Because mobile applications provide businesses the ability to regulate the client experience.
The client has purposefully downloaded and launched your app alone rather than searching the internet and comparing goods and prices. Therefore, compared to websites viewed on mobile browsers, mobile apps typically have a higher conversion rate.
Additionally, you may improve your mobile app to retarget devoted users, rewarding app users alone by running specials and discounts.
Your branded app can target particular clients who are looking for a distinctive experience, just like Instagram and Facebook are distinctive channels for a specific group of customers.
When Mobile Commerce Isn't Always the Best Choice
Even if mobile commerce is becoming more and more popular, you don't have to jump on board right once. M-commerce might not be the best platform for all internet enterprises.
Here are a few warning signs to watch out for:
A lack of resources for development
We've previously established that mobile commerce differs significantly from traditional eCommerce; as a result, you can't anticipate that all of your skills and resources will seamlessly transfer when you create a mobile store.
You need the necessary skills to support this transformation if you want to become mobile. You should have an internal or external development team ready to go for mobile projects since m-commerce is an industry that is becoming more and more competitive. It could be more challenging to achieve your goals without the necessary resources and personnel.
Your target consumer does not use a mobile device
Make sure the audience you're targeting really uses their mobile devices before you start developing a mobile website or branded app. Otherwise, you can be wasting your time and money.
Persons 65 and older have the lowest rate of smartphone ownership as of 2021. (only 61 percent ). Therefore, you might not want to focus on mobile commerce if your company caters to elderly individuals.
Utilizing Mobile Commerce
Are you ready for your company to go mobile?
To assist you with having a successful launch, we've highlighted several m-commerce trends and advice in this article.
Give a mobile commerce platform more importance than fashion trends
It's simple to focus on the newest design fads rather than mobile site optimization. Responsive design can increase a mobile website's visual appeal, but sales are not always the consequence.
Use social commerce tools
It should come as no surprise that social commerce is on the increase given that 91 percent of social media users interact with social channels through their mobile devices and that mobile platforms account for 80 percent of all time spent on social media. Mobile users may explore items and make purchases without ever leaving the app thanks to social commerce platforms like Facebook Shop, Instagram Shopping, and Pinterest Business. These platforms are paving the way for a seamless purchasing experience.
Physical stores may allow in-store pickup
Don't ignore brick and mortar, though. The most effective omnichannel strategies, which offer a seamless user experience across online and offline channels, are integrated into mobile commerce websites.
In 2019, Statista discovered that a large portion of consumers rely on their mobile devices for both in-store and online purchasing.
Offering click-to-mortar alternatives, such as online ordering and in-store pickup, is one method to connect mobile and in-store purchasing. Customers now have the convenience of shopping and making purchases from the convenience of their homes without having to wait a few days for delivery.
Use chatbots on mobile devices
Insider Intelligence estimates that while worldwide consumer retail spending via chatbots was worth $2.8 billion in 2019, it is anticipated to rise to $142 billion by 2024.
Online merchants are increasingly using chatbots and virtual assistants to help answer queries and give support at the beck and call of the client as consumers expect 24/7 customer care.
Chatbots will not only facilitate consumer conversations but will also free up your time as a retailer to concentrate on other areas of your business.
Create a loyalty program within the app
According to a Statista analysis, loyalty and reward programs came in second place as a motivator for mobile users to download retail applications after discounts and special deals.
Each time a consumer makes a purchase, they have the opportunity to accumulate "points," which ultimately mount up and may be used for rewards like a product discount or early access to a new collection.
These rewards programs encourage users to download your app, but more significantly, they encourage them to return to your store in the future and make another purchase.
Use augmented reality on mobile devices (AR)
Notably in the fashion and beauty sectors, augmented reality emerged as a potent tool for merchants to duplicate in-person experiences online, particularly during the COVID-19 epidemic.
Before ever touching the item in their hands, online consumers can now view exactly how a piece of apparel would appear on themselves using 3D and AR technologies. AR and VR fitting rooms provide buyers with a good representation of the size, fit, and style of a product by sensing the customer's shape.
Burrow, a furniture company, is another excellent illustration. Burrow employs augmented reality to let clients see how their couches would fit in their homes.
M-commerce is on the rise
It goes without saying that mobile commerce is a phenomenon that will not go away. Mobile shopping will probably become less of a choice and more of a must for eCommerce businesses as smartphones become more and more integral to how we connect, get information, and now purchase online.
M-commerce is, of course, just a tiny part of the market. Remember that to maintain an effective omnichannel approach, your mobile website or app must seamlessly integrate with other channels rather than acting as a standalone platform.
Always keep in mind that the main goal of mobile commerce is to meet your clients where they are and provide them with a simple but memorable experience.
- What is that?
- Various Types of Mobile Commerce
- Most Common Mobile Commerce Benefits
- Mobile Commerce Drawbacks
- Mobile Payment Types
- How Page Speed Affects Mobile Commerce
- Choosing Between a Mobile App and a Mobile Website
- When Mobile Commerce Isn't Always the Best Choice
- Utilizing Mobile Commerce
- M-commerce is on the rise