The rise of Mobile commerce(m-commerce)

From all the shopping channels available to customers, mobile commerce is taking the lead. It forecasted that mobile commerce will have the biggest retail sales growth (12.2%) in 2021, beating traditional ecommerce and in-store shopping.

Whereas, mobile commerce can be a frustrating and painful experience for consumers and businesses for two reasons:

1. Mobile-friendly sites are all but universal.
2. Mobile-friendly isn’t enough to capture mobile commerce sales

Mobile commerce is a natural progression of ecommerce. Mobile commerce differs from the ecommerce website experience in one main way: the person buying the product is doing so from one of these smartphones. Ecommerce retailers either need a mobile-friendly website that loads on those smaller screens, or a dedicated mobile app that customers can download to their device and purchase through.

What is mobile commerce (m-commerce)?

Mobile commerce, also known as m-commerce, is the process of buying and selling items through a mobile device, tablet, or other handheld device. Mobile commerce transactions can be for products or services including fashion items, business software, or CPG.

The release of new phone technology including 5G is accelerating the shift to mobile commerce. That, plus the fact society is mobile-obsessed and more dependent on digital devices than ever. Here’s proof:

• The average person taps their cell phone once every 10 minutes (averaging three hours and 15 minutes of use) every day.
• 1 in 5 people would rather go without shoes for a week than take a break from their phone.
• People report withdrawal symptoms including increased blood pressure and heart rate when separated from their mobile phones.

How mobile commerce works?

With most m-commerce enabled platforms, the mobile device is connected to a wireless network that can be used to conduct online product purchases. For those in charge of developing an m-commerce application, important KPIs to monitor include the total mobile traffic, total amount of traffic on the application, average order value and the value of orders over time. 

Similarly, tracking the mobile add to cart rate will help developers see if users are becoming customers. M-commerce developers may also be interested in logging average page loading times, mobile cart conversion rates and SMS subscriptions.

In terms of mobile payment products specifically, they operate through a form of peer-to-peer (P2P) sharing. Once a mobile device is paired with a bank card’s information, the phone can be waved over a payment terminal to pay for a product. This contactless payment using a mobile device is possible due to the use of Near Field Communication (NFC).

Ecommerce and mcommerce

Ecommerce and mcommerce have different meanings, though both aim at making customers’ lives easier. Simply put, e-commerce is an umbrella term for selling and buying online, while mobile commerce, or mcommerce, is a subcategory of ecommerce that focus on purchasing via mobile devices.

Despite their similar goals of buying and selling with the help of the internet, there are many glaring differences between ecommerce and mcommerce.

Key differences between ecommerce and mcommerce

Mobile commerce differs from the ecommerce website experience in one main way: the person buying the product is doing so from one of these smartphones. Ecommerce retailers either need a mobile-friendly website that loads on those smaller screens, or a dedicated mobile app that customers can download to their device and purchase through.

Although the world of the web and the world of mobile devices are based on the same fundamental principles and aim to make people’s lives easier, there are a few differences between ecommerce and mcommerce.

1. Mobility

Ecommerce stands for electronic commerce, wherein shopping is done over the internet. Usually, e-commerce activities are conducted with the help of desktop computers and laptops, so users have to look for a place to do their transactions. It’s uncomfortable to use a laptop just anywhere or while on the move.

Mcommerce implies the use of mobile devices. So people can do their business transactions anywhere they go as long as they can access the internet on their smartphones and can perform transactions with just a few taps on the screen. Instead of using a plastic card to make purchases, with mobile wallets like Apple Pay and Android Pay users can pay with their smartphones, tablets, and smartwatches.

2. Location tracking

The location tracking capabilities of e-commerce are limited due to the non-portability of devices. Mcommerce apps, though, can track and identify user locations with the help of GPS technology, Wi-Fi, and so on. As a result, mcommerce apps can provide location-specific content and personalized recommendations. For example, notifications can let local businesses offer personalized discounts targeting particular customers in a particular location.

3. Security

Security is an essential part of any transaction that takes place over the internet. In the case of ecommerce, credit cards are the most common form of payment. However, consumers are still somewhat afraid of sending their credit card numbers over the internet. According to research, Americans are very concerned about online security and privacy. And that’s a challenge for ecommerce.

The security capabilities of mobile commerce are a bit more extensive. In addition to regular security measures like two-factor authentication and multi-level authentication, present in ecommerce, mcommerce can also offer biometric authentication (via retina scans, face ID, or fingerprints).

Benefits of M-commerce

Mobile commerce offers a range of benefits to businesses. Let’s take a look at some of the advantages to see why mobile commerce is the right approach for an online business.

1. Gain more insights on your customers

Mobile apps help retailers to connect with customers in a more personalized way. For instance, apps that combine beacon technologies and analytics enable retailers to directly engage with shoppers throughout their time in a store. Beacons are sensors that are placed on shelves, product displays, and signs and that interact with nearby mobile devices.

They essentially offer a personalized shopping experience. Signals deliver deals and promotions and can combine the world of online shopping with an actual retail store. Those signals can even let customers know when new products arrive that they may be interested in.

Customer insights gained from the technology allow retailers to shift in-store strategies and operations to match shopper interest and behavior, leading to increased customer loyalty.

2. Personal touch

When used properly, push notifications are a great way to drive users to engage with an app on a more regular basis. Push notifications in particular efficiently bridge the gap between a business and its potential customers. They’re more prompt at delivering offers and reach audiences better, as mobile devices are often carried along almost anywhere a person goes. And, as research shows, on average 62 percent of users will return to an app the following month if they’re engaged with push notifications.

3. Enhancing the customer experience

People often keep mobile devices close to them, so by providing the right kind of service, retailers can capture the attention of consumers more easily. Amazon Go is a great example of how you can implement different marketing channels that complement each other.

Another strategy to try is using chatbots and messenger apps, which make it easier for businesses to interact with their customers using apps and services that customers already use and love. AI integrations can be used to provide better-personalized shopping experiences, more efficient customer interactions (through chatbots), and fraud protection. They can also support image searches.

4. Variety of payment options

With new mobile payment solutions emerging, it’s now possible to offer customers a truly diverse range of payment options. This doesn’t mean we’ve moved beyond the question “cash or card,” but mobile commerce has given us mobile wallets that make one-click checkouts possible in more than one store. Popular mobile payment solutions include Apple Pay, PayPal One-Touch, and Amazon Pay.

5. An extra marketing channel

In addition to notifications, mcommerce provides an opportunity to promote businesses by offering promotions, mobile-only discounts, special prices for registered customers, free shipping, and much more to improve user registration and earn new customers. With the help of mcommerce, a business’s marketing can go viral and their customer base can start to increase.

Drawbacks of mobile commerce

1. Less human connection – when asked about customer service, roughly 70% of customers say that they’d rather interact with a human representative than a chatbot with almost 30% specifically saying they’d prefer to speak on the phone. This fact can present some problems for mobile commerce business owners since they may rely quite heavily on chatbots and other automated customer service solutions.
2. More competition – along with the advantage of reachability comes the disadvantage of entering a global market that’s very-likely saturated with businesses that do the same thing you do. Even if you’re targeting a domestic market, it’ll take some time before your intended audience will have an easy time pinpointing your business among the many others claiming to offer the same quality goods or services.
3. Depends on reliable internet connection – conducting business through mobile devices is great for ease of use, but only if those mobile devices have access to the internet. Plus, if it’s a mobile shopping app, you’ll have to invest in ensuring that the app doesn’t crash. And on top of that, if your servers aren’t strong enough, a heavy flow of traffic could result in your store ‘stalling out’ and not processing any orders at all. These are concerns worth paying mind to especially if you intend on doing well during Black Friday.

What are the types of mobile commerce? 

1. Mobile payment apps

Mobile applications are downloaded to a shopper’s smartphone. People can either send money to their family and friends (through apps like PayPal and Venmo) or pay for goods and services.

Data shows that almost half of mobile device owners who’ve used a retailer’s mobile app did so to discover more information about a product or service. Another 40% used the app to make a purchase. That’s likely why there was a 40% growth in shopping app downloads from 2019 to 2020.

Most mobile devices have a built-in card storage feature, such as Apple Pay, Samsung Pay, and Google Pay. They work using the same near-field communication (NFC) technology that powers other types of virtual payment, like contactless cards. 

These digital wallets were used to make more payments than debit cards, bank transfers, and buy now, pay later transactions combined in 2020. The entire market for mobile wallets is expected to be worth $350 billion by 2026.

2. Mobile commerce apps

Smartphones give users the luxury of opening a browser and purchasing anywhere. However, being on the front page of a potential customers’ smartphone—without forcing them to open their browser and find you—is possible with a mobile commerce app. 

Once a user downloads it to their smartphone, they can scan your product catalog, purchase an item, and track their order without leaving the app. Mobile commerce apps also have the additional benefit of sending push notifications to people who’ve downloaded it (so long as you’ve got their permission to do so.) 

Investing in a custom mobile app is expensive and time-consuming. Platforms like Shop exist to solve that problem. The 24 million customers already using Shop can follow their favorite brands inside the mobile app. If they see a product they like, they can click the link and purchase the item through a retailer’s website. Just one more click and their order is confirmed. 

3. Social commerce

Social media platforms have global audiences in the billions. TikTok, the most downloaded app in Apple’s App Store, triggers users to spend $50.4 million every year. But it’s not just virality that social media apps can give to online retailers. Most are evolving to facilitate social commerce so their users can buy products from third-party retailers without leaving the app.

Instagram launched the Shopping tab as a way for its users to explore new products. Facebook pushes retailers to use its built-in storefront. Pinterest uses buyable pins to promote items for sale. Because of the development of mobile apps, eMarketer predicts that US retail sales through social media will rise by 34.8% in 2021, reaching $36.09 billion. 

4. QR codes

QR codes are small square graphics shoppers scan in-store using their smartphones. Each code is unique to a specific landing page.  If you have a Shopcode at the checkout desk in your brick-and-mortar store.

For example, you can direct shoppers to a personalized in-app checkout page. You can also add them to product packaging for customers to make repeat purchases via their mobile phone once a previous order has been delivered. Either of these options pair QR codes with other types of mobile commerce technology, including mobile banking, digital wallets, or applications.

Special Considerations

1. Mobile web and mobile commerce applications

Social media ads – such as Google and Bing ads – are used to initiate online shopping searches. Eventually, browsers facilitate more online commercial transactions than mobile commerce applications. It makes consumers use mobile websites and mobile apps concurrently to enhance the shopping experience.

2. Mobile inventory management (MIM)

Mobile applications track the location of goods and services to determine a delivery time. Service providers use the information to improve customer services and gain a competitive advantage over competitors.

Examples of MIM include just-in-time delivery and rolling inventory, which are implemented based on cost, user-friendliness, and reliability of wireless infrastructure. The applications present the paradigm shift in how inventories are managed.

3. Mobile commerce videos and marketing

To generate more revenues, mobile commerce applications use videos to demonstrate the product’s key features and usage. For example, an online foreign exchange broker can share videos showing how their new trading application eases trading activities and how customers can leverage that to increase their revenues.

4. Improving mobile commerce

Consumers are often impatient, demanding instant gratification; hence, quick-loading webpages are likely to generate more sales. Mobile checkers must facilitate easy entry of payment information using electronic mobile wallets. It reduces human error and allows a smooth checkout experience.

When is mobile commerce not right for a business?

Developer time is limited

Developing your own mobile app can be time consuming. Before investing in your own, consider whether you have the time to maintain it. Experts recommend allocating 20% of the app’s initial development cost to ongoing maintenance. Fixing bugs, releasing new features, and maintaining functionality with mobile software all eat into the time (and money) spent updating your mobile commerce app. Justify whether that’s a price worth paying.

“If you are just starting out or have budget constraints, I would focus on giving your customers a highly polished responsive website experience. Mobile websites are cost-effective compared to native apps, and it will also be easier for you to market and reach your target audience.

Your target customer isn’t an active mobile user

While smartphone usage is on the rise, it’s worth noting that the internet penetration rate isn’t 100%. Research shows just 61% of people over the age of 65 own a smartphone. This generation also spends the least amount of time on their smartphones, making a mobile commerce strategy less of a priority if your target demographic is older. 

Similarly, think about the countries your target customer lives in. Mobile shopping is trendy in some areas of the world but not in others. Just 31% of online shoppers in Belgium and 32% in Japan bought something on a mobile device in Q3 of 2020.

How to optimize for m-commerce

There are plenty of mobile commerce solutions that you can put to good use, so don’t be fooled by the size of the following list. That said, if you begin with the three strategies for optimizing your m-commerce website below, you’ll be off to a great start. Here are the top three mobile commerce solutions:

1. Optimize your website for mobile

The reality for many mobile e-commerce businesses is that building a custom app for their stores might not be in their immediate futures. If that’s true for your store, you can still make your m-commerce customer experience better by optimizing your website for mobile access.

Fortunately, you don’t need to be a computer whiz to get this done. There are several e-commerce website builders that automatically reshape your website to fit mobile devices. Be sure to do your due diligence! 

2. Make your checkout process easy

If you’ve been working in e-commerce for any amount of time, you know how big of a problem online shopping cart abandonment can be to your business. Making your checkout process more efficient and quicker won’t just help to reduce cart abandonment, but will also act as a mobile commerce solution to keep your m-commerce transactions flowing in on a consistent basis.

3. Use less heavy content

When you’re aiming to adjust your already-existing website to be mobile-friendly, you’re most likely going to hit some snags along the way. One of the more common complications that mobile commerce can bring up is that your website’s content may not fit on mobile devices the way you (or your customers) would like.

For m-commerce, you’ll want to keep the shape and substance of your content strategy focused on mobile accessibility. Shorter text is better than long paragraphs. Spacing may need to be played around with a bit to get right. Margins should be kept small so as not to create too much white space.

Once again, you don’t necessarily need to be an expert to get this stuff done. There are a number of e-commerce platforms best for SEO that provide easy solutions to optimizing your content for mobile e-commerce.

Mobile commerce trends and statistics

1. Prioritize a mobile commerce platform over design trends

In the case of ecommerce, a caveat is in order. While the “needs of mobile visitors” must certainly be respected, what matters is marrying their needs with your own. After all, a delightful user experience (UX) is worthless if it doesn’t culminate in sales.

At the enterprise level, it’s easy to get seduced by mobile design trends instead of investing in proven optimization tactics. How can you unearth the difference?

You start with the platform you’re hosting on. Shopify Plus’ ecommerce platform has mobile commerce features including a built-in mobile shopping cart, responsive theme, and push notifications. Your customers can shop anywhere, on any device.

2. Rely on social commerce features

Social media has become central to our livelihoods, and our reliance on mobile devices fuel the addiction. The vast majority (91%) of social media users access their favorite platforms using a mobile device.

But these days, social media apps are no longer used just to chat with virtual friends. Some 54% use social media to research products. Platforms like Pinterest and Facebook play a role in mobile shopping, with 47% and 15% internet users using them, respectively.

That’s why you must invest in a social promotion and advertising strategy to increase mobile traffic and conversions on native social selling channels, including:

• Facebook shops
• Instagram Shopping
• Product Pins
• Marketplace communities like Houzz

The downside? You’ll be pressed to find a retailer who isn’t using social media to fuel its mobile marketing strategy. Standing out from those can be tough.

Live shopping is one mobile commerce trend we’re expecting to see increase in 2021. Platforms like Instagram and Facebook have their own live streaming options. To cater to both the shopper and the merchant, each feature allows brands to link directly to the products they’re talking about. 

The success of your social commerce strategy hinges on the direction you’re pointing social shoppers to. In most cases, linking directly to the product in question delivers a better user experience.

3. Facilitate mobile click-to-mortar 

Mobile commerce lies at the heart of an omnichannel retail strategy—especially one that spans both online and offline. Data shows that people rely on their mobile phones for in-store shopping. Half of people use their mobile device to research a product; another 27% have purchased a product from their mobile device while visiting a brick-and-mortar store. 

Work to combine this online-to-offline (and back again) shopping experience with click-to-mortar incentives. They align your in-store experience with mobile shopping.  Using QR codes, mobile-specific comparison pages, and geo-fenced SMS coupons, and prioritizing FAQs on mobile are just some of the methods large and medium organizations can try to facilitate the back-and-forth mobile users are already doing.

The lowest barrier to entry? Buying online and collecting in-store (BOPIS). Some 59% of shoppers are interested in online shopping and collecting their purchases in-store. Interest is up 30% since the start of the pandemic. 

Many companies are turning to mobile-enabled in-store checkouts and mobile wallets for customers who have been pointed to their store by a mobile device. Long lines in-store can be a major drag. Mobile point of sale (POS) devices—like PayPal, Square, and Shopify POS—offer an easy-to-use and cost-effective solution.

4. Offer one-click checkout

Mobile ecommerce lies or dies at the checkout. If only a small percentage of your online sales are coming from mobile users, you may need to refine your checkout process.

How? By following the golden rule: less is more.

Some 18% of people will abandon their online cart if the checkout process feels too long or complicated. Having to re-enter basic details like credit card numbers (30%) and shipping details (25%) is what causes mobile shoppers to head for the exit button.

Here’s where we turn to a few in-house advantages from Shopify Plus.

Ideally, once a user enters your mobile-checkout process, they should be presented with mobile-first payment options that enable them to purchase in a single click. On Shopify Plus, you can do this through:

1. Shop app
2. Apple Pay
3. Android Pay
4. PayPal
5. Amazon Pay

Include only those options that are most popular among your existing customer base. But remember: this doesn’t mean you should skip traditional logins and credit cards, as long as those methods have proven themselves as attractive to mobile shoppers.

Lastly, Dynamic Checkout flows offer your mobile customers the ability to check out single products directly on a product page. The code recognizes their preferred payment method (such as Apple Pay) and displays a simple CTA button for people to purchase in just one click. 

Some of the key benefits of installing a dynamic checkout button include:

• Accelerating mobile conversions by reducing the number of steps to complete a purchase
• Delivering a personalized mobile checkout experience by serving up your customer’s preferred payment method or wallet
• Capturing customer intent earlier with a custom checkout button, which appears directly on the product page and circumvents the need to add a product to the cart first

5. Leverage in-app push notifications 

If you’re facilitating m-commerce through your mobile app, push notifications work to get users spending more time shopping through it. They’re notifications that show on customers’ smartphones, usually announcing limited-time sales, promotions, or launches. 

These push notifications have been found to increase app engagement by 88%. They get disengaged users back, too, with 65% returning to an app within 30 days of the push notification. 

Shop app uses push notifications to drive shoppers back to a merchant’s mobile website. Users can get automated messages when their order has shipped, special discount codes to encourage repeat purchases, and invitations to join a retailer’s customer loyalty program.

6. Create personalized shopping experiences on mobile 

The mobile web is both a blessing and a curse for ecommerce merchants. Users have short attention spans and are easily distracted by text messages and social media notifications.

To stand out, create personalized user experiences that help keep their attention long enough to convert them into buyers. On a mobile device, you need to help customers find exactly what they’re seeking in just a few seconds—while using less real estate than on a desktop to make your sales pitch.

Personalizing product recommendations based on the traffic source of new visitors is a smart strategy. If a user arrived on your homepage after a search for hockey equipment, consider moving product recommendations for hockey players higher above the fold to help with relevant product discovery.

When visitors enter your URL directly or arrive at your site via a generic search, you can use Tinder-style product discovery widgets on your homepage to quickly introduce users to popular products. Another simple, yet emotionally impactful way to personalize a user’s experience on your site is by identifying their IP address to deliver custom free shipping offers.

7. Leverage mobile chatbots 

Emails are a tried and proven way to encourage customers, through reminders and special offers, to buy the items they left behind in their checkout cart. But chatbots are quickly gaining ground in this area either in conjunction with or instead of emails.

Chatbot usage grew by 92% in 2019, making it the fastest-growing communication channel. They’re quickly becoming the first point of call for mobile shoppers, with 80% of customers who’ve used one reporting a positive experience.

8. Prioritize mobile loading speeds

While it’s not the most exciting topic, decreasing a site’s load speed matters for attracting, acquiring, and keeping customers. Mobile design maintains the aesthetic of its desktop counterpart, but in many cases, it fails to optimize behind-the-scenes elements that unnecessarily eat data. The result is a beautiful experience that visitors pay for in lengthy load times.

Some 61% of Google search results now come from a mobile device. Search engines are clocking onto this and penalizing sites that don’t deliver seamless mobile shopping experiences. 

Google’s shift to mobile-first indexing, for example, takes the mobile experience of a site into consideration when determining where each page should rank even if the searcher loads it on a desktop. Google PageSpeed Insights is the perfect starting point. It’ll show average loading times across mobile devices, with recommendations for fixing them. 

9. Build an in-app loyalty program

Loyalty programs incentivized people for making repeat purchases. Most often, they’re a points-style system, whereby customers accrue points on each purchase. Those points have monetary value and can be redeemed on future purchases.

However, app loyalty programs don’t have to sacrifice profit margins. Fashion retailer In The Style regularly collaborates with influencers on product launches. Its app loyalty program centers around that: shoppers who’ve downloaded the app get to shop the new collection an hour before they’re added to the main website. 

The best part? Investing in a mobile app loyalty program pays dividends in the long term. After receiving a reward or incentive, consumers are more likely to share their experiences with friends, leave a positive review, and make a repeat purchase. 

10. Use augmented reality 

Augmented reality (AR) has come a long way in recent years. What once felt like an expensive investment is now accessible to most medium to large companies.

One technology advancing faster than others is virtual fitting rooms. Shoppers can use their mobile devices to livestream their body. Augmented reality places a 3D model over the live stream so shoppers can see what the product looks like.

Conclusion

The rapid growth of mobile commerce is attributed to the growth of wireless communication networks, mobile commerce apps, and improved device infrastructure. Developers are increasingly striving to make m-commerce go mainstream by making webpages load easily, easy payment entries to minimize human errors, and enhance the checkout experience. 

Moreover, mobile commerce is the use of handheld devices to deliver electronic commerce capabilities using wireless technologies.