A slew of mobile commerce experiments are popping up across mobile networks and devices. From Papa Johns’ mobile site which allows consumers to place pizza orders to Barnes & Noble’s e-commerce ready application; to P&G’s microsite which allows customers to purchase products through Drugstore.com’s mobile site; to Fandango’s mobile app and ticket purchase platform. Branded direct response campaigns seem to be picking up steam fueled by mobile commerce applications. But consumers have not yet adapted to mobile purchasing in overwhelming numbers. When will consumers make the shift and what will drive that adoption?
Dan Butcher moderated the panel of mobile commerce insiders at digiday:MOBILE, which included Darren Cross, Director of Business Development at Fandango; Jeff Montgomery, Chief Revenue, of location based ad firm 1020 Placecast; Riz Virk, Head of Mobile Strategy, Offerpal Media; Jeremy Arnon, Senior Director, Business Development, Quattro Wireless.
As Butcher pointed out, across every single vertical, major brands are launching mobile platforms. From fast food chains like Chipotle or Pizza Hut; fashion brands such as Ralph Lauren; hotel brands like Wyndham and Hyatt; retailers like Amazon or Barnes and Noble. Mobile Commerce apps are exploding and media coverage reflects the waves of new entrants in the space. But what is the focus behind the trend? Is this mere experimentation or a real commitment to engaging consumers and converting eyeballs to sales on the third screen?
Quattro’s Jeremy Arnon sees this as the beginning of something much bigger: the precursor to a tipping point in consumer behavior. Said Arnon, "Trusted brands are driving people into retail, and that is a first step to consumer comfort in mobile transactions." Arnon sited banks as a prime example of trusted brands that are warming consumers to the mobile commerce trend. As Arnon pointed out, "if you’re comfortable using your bank’s mobile app, it makes it easier to do other types of commerce on your phone."
Butcher asked his panelists “what's preventing m-commerce from reaching a mass audience?” Largely, the panelists remarked that it’s a matter of answering consumers’ objections to providing credit card info via mobile. Security is a concern for many would-be mobile shoppers. One panelist compares this era in m-commerce to the early days of e-commerce on the traditional Web, when shoppers were leery of entering credit card information. Once consumers' security worries were addressed by retailers and banks (offering online fraud protection), e-commerce ultimately exploded.
M-commerce still lags due to similar concerns and some of those consumer objections haven't been addressed yet. Despite big brand experimentation in the mobile shopping space, “the average consumer isn’t as ready to enter credit cards on cellphones as frequently as they do on PC web,” explained Riz Virk, Head of Mobile Strategy, Offerpal Media.
Darren Cross, Fandango's Director of Business Development cited iPhone users as the notable exception. Fandango sees nearly 1 in 10 tickets sold via the mobile web, driven in good part by the launch of Fandango’s iPhone app. iPhone users currently represent around 5/6 of the company’s mobile user base. Cross explained that iPhone users are more comfortable sharing financial information and making mobile purchases, perhaps in part because of the interface’s similarity to the traditional web.
Overall the feeling from the panelists was that we’re just scratching the surface. Mobile commerce is still in its infancy, but we’re on the edge of something very big. IPhone’s user-friendly interface (and its ability to easily and securely store credit card info) certainly helped, with other smartphones catching up rapidly. As mobile commerce proves to be a convenient, user-friendly, and secure way to comparison-shop and ultimately purchase, consumers will make the shift. Said 1020 Placecast’s Jeffrey Montgomery “Research shows that people want more mobile commerce.” Brands are catching on; the mobile commerce trend could be a very exciting ride.
