It is becoming increasingly difficult for brands to ignore multichannel and omnichannel marketing strategies. It is a highly profitable strategy as it enables brands to reach and satisfy customers regardless of their preferred touchpoints. Mobile is rapidly emerging as the most important of all the marketing and sales channels available today. While the exact percentage may vary from source to source, mobile devices now account for the majority of Internet traffic. Statistics for 2022 estimate cell phone ownership at about 86% of the world's population. That is why companies have to invest in mobile commerce, the fastest growing sector of e-commerce. For many this is a logical solution, but many webshops are still not well suited for Mobile Commerce. So let's get the facts straight:
WHAT IS MOBILE COMMERCE?
Mobile commerce, also known as m-commerce, is a term that encompasses the use of mobile devices to buy and sell products and services. It is far from a new concept and was first mentioned in 1997 during the Global Mobile Commerce Forum. During that conference, stakeholders from 100 of the largest organizations began delivering e-commerce capabilities directly to consumers. Now, nearly 25 years later, technological advancements have achieved most of the goals outlined during that forum. Currently, 73% of the global e-commerce market is coming from mobile devices and there is no sign of a decline.
Mobile commerce roughly comprises two services. These include mobile shopping and mobile payment. These services are delivered to customers through websites optimized for mobile devices or native applications. With shopping and payment capabilities, mobile phones have essentially become points of sale that customers can take with them. M-commerce is an industry with huge benefits for businesses, but not without its drawbacks. Therefore, understanding from both sides is essential for decision making and implementation.
WHAT ARE THE BENEFITS OF MOBILE COMMERCE?
Below are four good reasons why mobile commerce is an attractive model for companies to invest in:
MORE CONVENIENCE AND ACCESSIBILITY FOR USERS
One of the main factors determining the popularity of mobile devices is portability. Unlike desktops and laptops, modern shoppers spend practically every day with their phones at their fingertips. Not optimizing the m-commerce strategy is equivalent to limiting customers' shopping time. Therefore, bringing e-commerce services to smartphones and tablets increases accessibility and convenience for consumers. As a result, mobile commerce is the key to improving the customer experience and perfecting omnichannel marketing.
EXCELLENT DATA SOURCE
On average, people spend three and a quarter hours on their phones every day. By offering mobile shopping and payment, brands can leverage people's dependency on their phones. Valuable data is generated with every interaction customers have with ecommerce websites and apps. Then companies can better use the data to understand customer characteristics, preferences and persona. Therefore, brands are able to improve the customer experience through strategies such as segmentation and personalization.
REINFORCED CAPACITY FOR EXPANSION
Mobile commerce guarantees greater brand awareness and visibility. In addition, companies can easily extend their reach across borders. Shoppers from different cities, continents and countries can easily view products and services and make purchases seamlessly. Therefore, companies must capitalize on the growth opportunities by optimizing their services for mobile.
OPPORTUNITIES FOR MARKETING
Due to the myriad of alerts and notifications that are received intermittently, most people check their phone about 96 times a day. For companies, this is an opportunity to increase the efficiency of their marketing tactics. For example, geofencing can be used to advertise and notify customers when they enter certain geographic areas. Mobile push notifications can also be sent to increase engagement, interaction and conversions.
WHAT ARE THE DISADVANTAGES OF MOBILE TRADE?
Yes, mobile commerce also has some “disadvantages”. In this case, many of the advantages are also disadvantages. Here's a summary of four potential problems of m-commerce:
Mobile commerce gives brands more access to customer data. This inevitably leads to concerns as customers become increasingly concerned about how their data is being used. So companies will have to make extra efforts to ensure data security and privacy compliance.
Exposure to an international audience also means exposure to international competition. Companies are now dealing with companies from all over the world. This makes it more difficult to gain a competitive advantage.
While highly profitable, mobile business can also be costly. For example, the shipping costs increase when delivering products to customers on different continents. Of course, these costs can also be passed on to customers. Also, m-commerce requires regular updates and upgrades of the software, which can also be expensive. This can be solved with a Mobile First strategy: building the webshop as a mobile webshop that also runs well in a desktop browser.
INCREASED FRAUD RISK
The risk of fraud in mobile business is high and compounded by the fact that most companies are unprepared. Fraudulent activities such as phishing and click spam are common and companies should take active measures to prevent this.
In short, mobile commerce is a strategy too important to ignore. The advantages are many and the disadvantages can be solved with a good IT strategy and implementation.