E-Commerce, Meet M-Commerce
A successful business or brand will strategize, implement, and manage every aspect of the customer relationship cycle. Known in the business world as touchpoints, these are the carefully designed moments of interaction a customer will encounter with a business throughout the relationship. Whether it’s physically touching a product a store or how a brand is experienced visually on a website, every touchpoint contributes in some way to customer perception of the business. In the fiercely competitive and rapidly progressing world of e-commerce and now m-commerce, perception and experience is everything to online shoppers.
Mobile commerce is often described nowadays as “m-commerce.” This term describes the activities involved with selling online, with transactions taking place primarily on mobile devices such as smartphones and tablets. It is a booming market where the winners stand to capture a vast portion of what’s being bought and sold worldwide. With nearly 4 out of 5 Americans shopping online and 77% of them carrying smartphones, m-commerce is here to stay. As an indicator of things to come, m-commerce sales in the United States on Black Friday/Cyber Monday 2018 passed the record-breaking $2 billion mark on the busiest shopping weekend of the year. There is no sign that the growing obsession with shopping on a smartphone will slow down anytime soon.
Smartphones have evolved from a fun gadget used to send text messages, play games, browse social media and occasionally make phone calls to incredibly advanced devices capable of handling many of the tasks we used to have to do on our desktop or laptop computers. It’s not just a cliché- there are apps for just about anything whether it’s tracking fitness and nutrition goals to booking airline tickets and downloading boarding passes.
Among the fastest adopted technology in history, the smartphone is rapidly becoming a part of everyday life for just about everyone. The landline telephone took 45 years to reach the same level of integration into American life.
The average American spends between 3 to 4 hours on their phone each day, and they are looking at their phones often, sometimes as often as once every 10 minutes. That’s 150 times a day, three months out of the year, and nearly half as much time as they spend sleeping. Mobile phones are surpassing television with how much time and attention they take up in their owners’ lives. And it’s not just because they’re watching television on their smartphones.
Shopping has long been a national pastime for Americans. As it’s moved online, retailers have taken notice and are finding ways for consumers to spend even more time on their phones doing what they love to do the most- browse, surf, and spend money.
Retail m-commerce sales in the United States topped $207 billion in 2018, and it’s expected that m-commerce sales in 2020 will top $338 billion.
When looking at m-commerce on a global scale, the statistics are even more impressive.
The number of people in the world who are connected to the internet is around 4.3 billion, compared to the estimated world population of nearly 7.8 billion. Over half of the world’s population is online in 2019 compared to fewer than 2 billion in 2010. The numbers go even higher for mobile phone users. Many internet users throughout the world connect using mobile devices instead of laptops or desktops, to the tune of 2.5 billion smartphone users in the world, and the numbers are growing.
The Benefits of M-Commerce
Consumers who love to shop online can now do it just about anywhere their mobile device has a signal or a WIFI connection. Incredible apps go far beyond the shopping cart. Shoppers can log into a retailer’s site, converse with retailers who are integrated with Facebook directly in their Facebook messaging app, and then buy instantly through Facebook. This practice is often referred to as contextual commerce, which means reaching your consumers where they are, which is usually on social media.
Mobile devices comprise nearly 49% of local website traffic, with desktop or laptop usage coming in at 47%. With over half of the world’s population often online with internet access, e-commerce and m-commerce are more critical than ever to any retailer’s long-term success.
By 2020, global e-commerce sales are expected to command 15% of total retail sales worldwide, reaching over $4 trillion, and with the growing number of consumers buying on their mobile devices, the competition to contend for and win their business is fierce. This means consumers are often being sold exactly what they want, and most retailers will bend over backward to ensure they make a good impression and hopefully a repeat customer.
3 Seconds or Less: Doing M-Commerce Right
For the consumer, there are few downsides to shopping using a mobile device to complete transactions online.
Some retailers have embraced online shopping early on, and the move to websites that are more optimized for mobile use is an easy one. After all, conversion rates are much, much faster for mobile shoppers on their phones. Shoppers on desktop or laptop computers often save carts (abandoned cart) and come back to it later. Over 70% of mobile searches lead to an action or sale within the hour vs. a desktop or laptop user taking a month to take action. 79% of Americans have made online purchases, with 51% of them utilizing a mobile device for shopping online.
On the other hand, m-commerce represents a growing battle for retailers to stay on top of the game. To keep consumers active on a mobile device on a website or app, tremendous resources must be expended on maintaining an online presence.
The modern consumer is, in a sense, spoiled. They are so accustomed to the steep competition for their attention and their money that they have subconsciously developed extremely high expectations for every interaction they have with a brand or business. This includes all the front-facing aspects of a brand, especially their website. A typical consumer’s opinion of a brand is heavily influenced by their interaction and experiences on that brand’s website. Their patience for poor customer service is low, and the attention span for a website to load is even lower. Even mobile users who are relatively new to online shopping will notice right away if a retailer’s website isn’t optimized, and this group tends to be even more impatient.
A shopper will typically leave in less than 3 seconds if their mobile experience with a brand suffers in any way. Issues such as a slowly loading site, a site that is not automatically optimized for the device the consumer is using to interface with the website, or even if they just don’t like the look of it. Speed, high-quality content, usability, ease of navigation and check-out, and personalization are critical to a positive consumer experience on a mobile site or app. Amazon has estimated that if the time it takes to load their page increased by even a second, they could stand to lose $1.6 billion a year.
Consumer loyalty (as high as 52%) is closely tied to how fast a mobile website loads. After that critical three seconds, most will either navigate or “bounce” somewhere else, get distracted by another app or function, or stop shopping altogether. 79% of shoppers will not return to a website that functioned poorly.
It’s tough staying one step ahead of technology advances, hackers, and optimization. Constant ongoing work and maintenance are needed to ensure mobile websites, apps, and customer interfaces remain easy to use with no glitches, outages, or other issues.
The expectation mobile shoppers have is for a fast, well-designed, and beautiful website that allows the consumer to rapidly find what they are looking for with an easy-to-use secure check-out. Consumers can be confused or disoriented if the website experience is not consistent with the same branding and style across platforms, so websites being viewed on a desktop/laptop should closely resemble the mobile version. Product descriptions should be concise, accurate, and detailed. If a customer can read everything they need to about a product they’re shopping for, they are more likely to buy it quickly rather than going elsewhere to get more information about it, abandoning their cart.
An effective product description will be tailored to the demographic the retailer hopes to reach. Specific products should have an ideal customer profile in mind when the descriptions are written. Product descriptions should also include keywords to enable consumers to find a retailer’s products through search engines.
Mobile shoppers indicate that they enjoy websites that have a lot of information relevant to the product or the target customer in addition to product descriptions, such as guides for picking the right products. Users tend to trust websites that post a lot of reviews for their products, especially when there are negative reviews, otherwise it appears less favorable content could be getting scrubbed by the retailer. Personalization is an attractive feature for 61% of mobile shoppers who enjoy their experience tailored to them based on their location, past shopping habits and preferences, etc. Speed is critical. Users get extremely agitated when websites and check-out processes do not load properly or quickly.
There are a lot of companies such as Shopify that cater to smaller business owners and retailers who want to break into the e-commerce and m-commerce world, offering incredible integrations with sellers like eBay, Amazon, and others. These sites help to even the playing field for entrepreneurs and retailers who may not have the budget to build their own online solutions from the ground up. These options solve lots of problems but often command a significant percentage of a retailer’s sales, adding to the credit card fees and payment solution fees.
“No Thanks, I’m Just Going to Buy This on Amazon”
No longer do consumers furtively scan something in a store and try to hide the fact that while they’re in a retailer’s brick-and-mortar establishment enjoying the air-conditioning, they have no intention of actually buying what they’re shopping for from that retailer. Because a lot of consumers still like to shop in person but buy online in hopes of finding a lower price, they will engage in a practice retailers have come to refer to as “Showrooming.” In the early days of online shopping, this practice scared and upset brick-and-mortar retailers.
“Showrooming” is where a shopper will use a smartphone app (such as Amazon’s) that will enable them to scan a barcode on a product in a physical location/store and then see how cheap it is online. This can be annoying for a retailer’s staff who watch it happen over and over again. Their stores have essentially become showrooms for more expensive items, including electronics and toys.
Smart retailers find ways to combat this behavior by leveraging the advantage of buying an item in-store against purchasing online.
Consumers also exhibit a behavior entirely opposite that of “showrooming,” called “webrooming.” This is what consumers do when they have researched their intended purchase online, comparing prices, reading reviews, and the last step is to go buy it. The good news for retailers is that recent studies show 69% of consumers “webroom,” while only 46% of consumers will “showroom” before making a purchase.
This interesting shift surrounds the fact that most consumers (47%) do not want to pay for shipping. If there is a chance they have to, they will be more likely to buy it in-store. 23% are immediate gratification enthusiasts or need it in a hurry, so they don’t bother waiting on delivery. That same 46% of consumers who “showroom” want to see and handle a product before purchasing, and if a retailer is smart, they’ll find a way to get that consumer to buy the product from them whether it’s in-store or on the retailer’s website later. Making it easier than ever to return products in-store appeals to 37% of consumers.
Retailers who engage both the “showrooming” and “webrooming” consumers through different channels find that diversifying the approach means more consumers will make that purchase through them. These retailers have learned that the important thing is not where the sale is completed anymore; it’s getting the sale period. Today that means completing the transaction where the consumer is. That could be at home in front of his computer looking for a new sofa or sitting on top of a mountain after a grueling hike, looking for a new water bottle to replace the one that went off a cliff.
Stores that utilize outstanding customer service rendered by well-trained and courteous staff, offer a fantastic in-store experience and a cohesive branding experience across all channels where they do business are more memorable to the consumer. They find ways to keep customers engaged even after they leave the store, and this is what is often referred to as multi-channel or omnichannel retailing.
Omni-Channel and Multi-Channel Retailing and Marketing
Multi-channel retailing refers to the practice of a retailer offering a cohesive and well-designed presence both online and offline, through multiple channels such as social media, websites, mobile websites, targeted marketing, ads, etc. The channels may not interact as seamlessly together as an omni-channel presence, which is a consistent brand experience throughout every channel the customer may use.
For a retailer that’s struggling with declining foot traffic, this will be the only way to thrive in the brave new world of online shopping. It’s sad and nostalgic to visit old retailers we remember shopping in years ago as they hang out the “Everything Must Go!” red signs and shutter their stores one by one. Many of them share the same sad tale, that they adapted to the online world too little or too late.
A well-designed approach includes maintaining your brand’s aesthetic and standard throughout the entire customer experience, regardless of the device they’re using or where they are. For example, this could mean from walking into a store holding a mobile phone in your hand with the brand’s app to shop, going home to shop online and seeing the same products, being able to shop online and pick up (and return) in-store, and fast, free delivery.
Brands who can implement these kinds of approaches can establish a strong, loyal, and enthusiastic customer base that will freely give up information about themselves and their shopping habits for the incentives the retailer offers them. Studies have shown that omni-channel customers who use all the different ways to interact with a brand can’t get enough of all the options when they are offered lots of touchpoints. Permission-based marketing with lots of incentives for consumers to interact with and buy even more from a retailer yields tremendous profits.
For example, Target gives its customers many options: to shop online, and pick up in-store or have it brought out to your car right outside the door, to buy online and receive free delivery for most items (some of them even same day), and shopping in-store, using online tools while in-store to find things within the store.
Target offers its “guests” a Target RedCard credit card and debit card. This allows them to track what cardholders are buying. Just in case you are not a Target RedCard holder, they recently implemented their Circle program. Built into their existing app, Circle rewards Target guests who dutifully scan in their purchases in return for coupons and specials. Target excels at collecting customer data, which then allows it to offer an even more personalized experience to shoppers, with irresistible special offers and circulars sent both electronically and by mail. Around big shopping weekends, Target guests often receive gift cards in the mail with a value of as much as $20.00 and always accompanied by coupons that are for products they regularly buy or have bought in the past around that time of year. Creepy? For some, yes. Others love this level of personalization and return to Target over and over. The viral memes about “You don’t need anything at Target today” testify to just how popular the store is with guests who regularly visit in-store multiple times a week.
Except for Amazon, most retailers who have adopted this kind of robust multi-channel presence enjoy considerable advantages. In the United States, consumers are increasingly choosing to shop online but pick up their items in-store, and statistics show that they also enjoy researching and browsing online before making these kinds of purchases with multiple retailers and websites. For specific categories, including clothing, many consumers prefer to see and touch items in-store before eventually purchasing them online.
Brick-and-mortar retailers have to compete hard and shift gears constantly to change the minds and hearts of the high percentage of consumers who “liked it here but are going to go buy it on Amazon.” The omni or multi-channel approach is proven to build a solid, loyal customer base, and the businesses who are winning at it are the ones who can nimbly adapt and show their customers consistency and high-quality design regardless of where their customer is reaching them: in-store, over the phone, or surfing a mobile phone, desktop or laptop computer.
Retailers who utilize these multi or omnichannel marketing enjoy considerable benefits with their consumers spending 15-35% more per transaction.
Most consumers will not buy the first or even the second time they visit a website, especially on their mobile phones. A smart retailer will utilize multi-channel marketing to create a relationship with a consumer, not just complete one sale. Good marketing across multiple platforms will tell the consumer that the retailer is trustworthy, that there are benefits to shopping there, and that maybe that site they clicked through is worth returning to.
Building consumer familiarity with a brand and credibility often means repetitive retargeting, using advertising. This has to be done subtly and respectfully. Marketers who talk about storytelling are often scoffed at, but this is, in fact, the best way to tap into a savvy online shopper and potential consumer’s interest.
Many retailers, even the big ones with a sufficient marketing budget to hire staff that should know better, make the mistake of retargeting their audience with the same advertisement over and over again. Eventually, the consumer will ignore it during their time spent online.
Instead, utilizing a retargeting campaign for the consumer that is cohesive but uses different components to tell a story about the retailer’s brand and products builds interest instead of irritation each time the potential customer sees an advertisement.
Consumers may not fully realize grasp how in-depth multi-channel marketing can be. A good deal of it can be done with software and algorithms that make it easy for retailers to reach out to and retarget mobile shoppers based on demographics and tracking pixels. But there is still a lot of strategy and good old fashioned customer service that goes into successfully bringing a brand to a consumer and convincing them to buy using a mobile device.
The downside to being everywhere a consumer is may be the means needed to reach them where they are. Unfortunately, to get the “all about me” level of personalization most consumers expect, the retailers must track their every move when online, sometimes literally, when a smartphone user’s phone will tell a merchant where the consumer physically is.
Some consider it a downside being so inundated with eerily specific advertising. No matter where you go or what you are doing online, you are considered a consumer and are being marketed to. Retailers are finding new ways to study consumer behavior to entice them constantly to browse, sign up, and buy. Technology has made it easy for brands and retailers to reach consumers where they are online with laser-targeted advertisements and offers.
There is a fine line between personalized, relevant marketing and consummate self-promotion for a retailer. The ones who get it right focus more on how they solve problems for their consumers than how much they want what’s in the consumer’s smart wallet.
M-commerce also protects consumers with payment solutions to keep their personal and banking information safe. Payment solutions like Paypal, Apple Pay, Amazon Pay, Visa Checkout and others allow consumers to store their data only with those companies and use their services to check out at just about any retailer who accepts them. The credit card information stays safe, and all that the retailer receives is the consumer’s email address. This added level of security for online shopping brings an additional layer of confidence amid the endless news stories about a retailer who was hacked or had their consumer databases compromised and stolen.
As we’ve touched on earlier, it’s easier for consumers to protect their personal and banking information using payment options. The most common are contactless mobile payment options, also known as digital wallets. The heavy hitters in this category include Paypal, Amazon Pay, ApplePay, Alipay, Google Pay, among many others. A lot of countries outside the United States have their own contactless mobile payment solutions as well.
Money transfers use apps to transfer money between users or to a retailer. These can be standalone apps such as Paypal, Google, or Venmo or an integrated means of sending payment within Facebook Messenger or SnapChat.
Closed-loop mobile payment systems are typically a means of paying that are proprietary to the brand or retailer itself. Starbucks and Walmart are significant users of this technology, which allows the consumer to put in their payment information once, then pay using one-click for all purchases made after that point. Target also utilizes this by offering the Target-branded store cards that can be synched with their app to allow the card to be used for mobile purchases.
Have you ever gone to check out online and realized you had to click through 3 pages before you could hit the buy button? Statistics show that simplifying the check-out page to one page and accepting multiple digital wallets improves mobile shopping conversion rates by nearly 10%.
In a global economy, retailers and merchants must also consider their audience and where their consumers physically live. Tax and business laws vary widely from one country to the next, as do requirements for how their website operates and what data they collect. Additionally, some products that are perfectly legal in one state or country may result in jail time for a consumer in another. Many retailers avoid the complications by simply limiting where they will ship their products to or selling through a massive retailer such as Amazon. And many of the large retailers such as Amazon and eBay will have a version of their site for each region.
Augmented Reality and Shopping
Augmented reality or (AR) is a wildly popular technology that allows consumers to interact with products from their mobile phones. The app utilizing AR will combine input (such as live view with the consumer’s mobile phone camera or a snapshot taken) and an overlay or digital product to give an immersive experience. For example, Madison Reed will superimpose a hair color on a consumer’s photo to allow them to get an idea of what that color would look like before they invest in the product. IKEA will superimpose images of its furniture from its AR catalog into a view of a customer’s home. eShakti allows consumers the ability to customize a dress and visualize it with or without sleeves, with various skirt lengths and collar options. Clothing retailers utilizing virtual fitting room technology to ensure shoppers get the right size the first time to establish trust.
While consumers nowadays often make impulsive purchases, there is also a sizable demographic that loves to research, read reviews, and “geek out” when buying things. Those interested in “test-driving” products can utilize augmented reality apps to do this easily with their mobile phones. It’s easy to make shopping decisions you can see and immediately envision the product in your life. This quickly builds excitement about a product and gives a taste of the gratification the purchase will provide to the consumer. Seeing it already “there” provides the consumer with the incentive to act immediately and buy right away. Interest and enticement are heightened when they can see the item in a highly personal context, such as that sofa in their living room or how amazing a new hair color will look on the selfie they took of themselves. They become more invested in the product. Many of the usual objections (the need to see it in the store or swatch or research more) are removed.
The opportunities to customize the mobile commerce experience are vast, and the technology continues to grow in popularity. For the retailers, though this is one more thing that can break on a mobile device, and requires a top-notch web development team.
Shopping with mobile devices is fun, convenient, and no longer a novelty. The world’s most popular retailers and the savvy grandmother selling knitted dog scarves are both making it possible for consumers to buy what they’re selling using smartphones. If a consumer didn’t immediately realize they needed dog scarves, just a few hours spent on a mobile phone shopping can might very well convince most consumers that yes, they should buy a dog scarf, even if they don’t own a dog because… somebody in their lives does, and they can get it delivered tomorrow for free.
We live in a world where unless they’re Amazon, a retailer can no longer stay in business without the means to attract and market their brand to a growing percentage of consumers who cannot live without their mobile phones.