M-commerce: The Time to Move Is Now

By Kristine Szarkowitz

Since the late 1990s,”e-commerce” has been the buzzword of the retail industry, and for good reason. Retailers have generated more than $55 billion in revenues this year from online sales-a figure that promises to grow at an accelerated pace. And e-commerce has paved the way for an exciting new revenue channel, which some expect to deliver equally profitable returns.

Welcome”mobile commerce.” Most easily understood as e-commerce on a mobile phone, m-commerce is making its way to the small screens of millions of U.S. consumers, offering retailers a new way to market and sell merchandise. M-commerce is already mature in foreign markets such as Japan, where just last year Japanese retailers realized more than $10 billion in revenues from m-commerce. Stateside, analysts are optimistic, predicting m-commerce revenues to reach $480 million in the next 12 to 18 months.

Jeff Bezos, chief executive of Amazon.com, has predicted that m-commerce”is going to be the most fantastic thing that a time-starved world has ever seen.” Bezos believes that eventually most of his business will come from mobile consumers. Considering that there are currently more than 250 million wireless phone consumers in the U.S. alone, he is probably right. That’s a lot of potential mobile shoppers driving what is expected to become the next era in retail commerce. Retailers better get ready!

The following is a quick primer to help you understand the m-commerce landscape and how to easily build your company’s presence in the mobile marketplace.

What is Mobile Commerce?
Mobile commerce is generally defined as the buying and selling of goods through wireless handheld devices such as cell phones or PDAs. It represents a new and rapidly growing channel where merchants can reach, market and sell to millions of wireless consumers.

Why Mobile Commerce?
Although much is made of how the U.S. lags behind Asia and Europe in the mobile arena, make no mistake: m-commerce is here. Retailers late to the game will be lost in the shuffle, scrambling to catch up to a rapidly evolving market, with their competition already efficiently leveraging the channel and consumers who demand the freedom to shop however, whenever and wherever they desire. Additionally, this channel-above and beyond all others-has the potential to bring merchants closer than ever to their customers. It is unique in that it provides a personal, one-to-one shopping experience with the consumer, which serves as an unbeatable competitive advantage and an avenue to drive sales revenue.

Who Uses It?
The prime demographic for mobile commerce today is Gen Y-consumers ages 15-29. This segment of the population is the first to have”grown up digital.” They are more connected than ever before and most knowledgeable about the myriad of technical features available to them on their mobile devices. More than 94 percent of these consumers own a cell phone, they frequently use their phone to access the mobile Internet and, as a combined group, they have purchasing power that exceeds $200 billion. Those accessing the mobile web say they prefer navigating directly to mobile-specific versions of brand sites by a margin of two to one, and 84 percent of mobile searchers expect the sites they visit to have a dedicated mobile version.

How Does Mobile Commerce Work?
Mobile commerce is just like e-commerce, with the exception that consumers are using their mobile phone to shop rather than their computer. To take advantage of the m-commerce opportunity, retailers must establish a presence on the mobile Internet by launching a mobile commerce website designed specifically to run on mobile devices.

Site development may seem like a daunting task to most, but the good news is that there are inexpensive, out-of-the-box technologies on the market today that can help a merchant successfully launch an m-commerce site quickly. For a merchant, creating a mobile website can be done literally in a matter of minutes with no need for technical expertise.

For example, mPoria’s solution enables merchants to quickly launch their own branded mobile commerce site. No intervention from a vendor is required. Most merchants can be up and running in as little as 20 minutes. Once the merchant chooses one of the four different service offerings, they simply sign-up online and-with the help of an online wizard-follow an easy site set-up process to establish company branding and their own mobile URL, product offerings and tax and billing guidelines.

Once set-up is complete, the merchant’s mobile shopping site is launched and can be accessed by millions of mobile consumers. The system securely handles the end-to-end consumer checkout process, offering both credit card and PayPal payment options.

Once a retailer launches his or her m-commerce site, consumers using virtually any mobile handset offered by all major wireless carriers, including Verizon, Sprint and AT&T, can access that merchant’s store to shop, compare prices and purchase their favorite merchandise.

A Mobile Revolution
A mobile revolution has begun and it is transforming consumer shopping behavior and their expectations for retailers. What does this mean for merchants? A couple of important things: First, it’s more important than ever for retailers to sharpen their sales and marketing strategy and include mobile commerce. This, in turn, necessitates launching an m-commerce site-or, at the very least-getting one on the drawing boards. Doing this is simple and there are first-class and inexpensive out-of-the-box solutions on the market to get merchants started-affordably and with minimal time commitment. Finally, erase all traces of doubt about the opportunity at hand: m-commerce will soon be an essential element of any retailer’s business and absolutely vital to market success.

Kristine Szarkowitz is senior vice president, media and analyst relations at mPoria, a leading mobile solutions provider based in Seattle. She can be reached at (206) 447-8045 or via e-mail at [email protected].