With increase in smartphone users day by day m-commerce (mobile commerce) is getting bigger and growing fast. It аll sounds vеrу impressive whеn included іn conference slides оr presentations tо clients/bosses. But closer analysis shows thаt analyst estimates vary massively аnd m-commerce іѕ асtuаllу ѕtіll оnlу а small proportion оf commerce, thоugh it іѕ а fast-growing proportion оf e-commerce. It isn’t thе consumers thаt аrе thе issue – research shows thаt thеу аrе keen tо shop uѕіng thеіr Mobile devices. Thе problem іѕ thаt thе Websites, apps, in-store, loyalty аnd ticketing systems оf mаnу companies (including big retailers), аrе simply tоо primitive tо аllоw m-commerce. Thіѕ hаѕ created а huge opportunity fоr thоѕе companies thаt mаkе m-commerce easy.

What is m-commerce?

mobiThinking defines m-commerce as “the buying and selling of goods and services via mobile/wireless technologies and devices”

It includes purchases on apps, in-store or from vending machines; paying for travel, events or bills; or redeeming a coupon… any type of commerce that is conducted using a mobile device.

Here are some recent eye-catching stats on m-commerce:

• “m-Commerce growth to exceed $600 billion sales by 2019 driven by  America,Asia and Europe (almost half in Asia)” – Digi-Capital (July 2016).
• “The value of mobile commerce transactions conducted via mobile handsets and tablets will exceed $4.2 trillion by 2021, up from $1.6 trillion this year” – Juniper (June 2015).
• “We estimate that by 2020, the m-commerce market is expected to reach US $800 billion worldwide” – Ericsson (July 2016).
• “We expect global mobile [payment] transaction volume and value to average 39 percent annual growth between 2015 and 2019, and we are forecasting a market worth $825 billion with more than 500 million users by 2017” – Gartner (June 2016).

As you can see there is considerable variation, which is what prompted mobiThinking to investigate what is included in analysts’ m-commerce stats. It’s not always clear – or not from the freely available information – how analysts calculate their stats (as is the case with Digi-Capital)

Crafting m-commerce into perspective

Why isn’t m-commerce larger? Is the retail entrepreneurs guilty ?

So why aren’t people buying more with their mobiles – is it because they won’t or because they can’t. There appears to be a consent among the analysts that the weakness lies squarely with the retailers.

• “Worldwide, people are not purchasing as much because the buying experience on mobile devices has yet to be optimized. People are spending less via mobile devices than via online e-commerce services and at retail outlets.” – Sandy Shen, research director, Gartner (June 2015).

• “A significant minority of retailers have yet to optimize their sites for mobile. Unless retailers ensure a seamless, user-friendly mobile shopping experience, they will fall behind competitors who are already using mobile channels to enhance customer relationships.” – Dr Windsor Holden Juniper Research (June 2015).

Shoppers prefer mobile Web over mobile apps

Why m-commerce is different to PC-based e-commerce

Commerce on the mobile Web differs to commerce on the PC Web in numerous ways.
• Size limitation of the device: the smaller screen, the touch-based interface (with smartphones), the lack of keyboard, makes filling out those lengthy forms that plague e-commerce sites – registration, delivery address, credit card details etc – a very painful experience.
• Cookies: most PC-commerce sites won’t work without cookies. PC sites place cookies on visitor’s PCs so they can recognize them when they move to the next page or return to the site. Most mobile phones don’t allow cookies.
• Context: Where a PC user is (usually) at home or work on a fixed Internet connection, the mobile user could be out-and-about, on transport, often on a mobile network connection (which aren’t as reliable as a fixed Internet connections) or on a less secure public Wifi or hotspot. Thus M-commerce needs to be as efficient and fast (with as few clicks and forms) and secure as possible.
• Payment scenarios: while PCs are usually restricted to remote purchases on the Internet, mobile payments could be Web-based or in person. M-commerce consist of paying for goods in-store, or paying for goods from vending machines, paying for transport or event ticketing,   mobile barcode-based systems (QR codes) , or SMS-based payment, perhaps using  NFC (near-field communications),.
• More (and easier) ways to pay: PC Websites commonly only offer one form of payment, by credit card, sometimes also with a payment provider such as PayPal. Entering debit or credit card details on a Website using a mobile phone is boring, which has led to the emergence of different payment methods. These include mobile wallets (m-wallets), where payments are deducted from a cash balance, topped up from a bank account or taken directly from a credit card account, of which there are numerous providers, many local to each country, such as

China’s AliPay, which is believed to be the world’s largest, ahead of Paypal. Payments can also be taken directly from the user’s mobile phone bill.

We will look at the differences between m-commerce and PC-commerce in more detail in a future article, but it should be clear that to be successful with m-commerce, companies need to rethink how they take payments online and in-store, both in order to make it easy for customers to pay and to accommodate the customer’s preferred method of m-payment.

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