COMPUTER BUSINESS REVIEW

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Issue Date: April 2008

Retail by phone

1 April 2008

Forthcoming improvements in mobile technology, such as better form factor and faster data speeds, are causing many retailers to think about adding a mobile commerce (m-commerce) channel in the next 12 to 24 months, according to Gartner. However, in order to drive m-commerce revenues in the future, both retailers and m-commerce vendors must seriously consider how far consumers are willing to shop using their mobile phones.
"Focusing solely on driving m-commerce revenue will not deliver what customers are really looking for when using their mobile phones during the shopping process," said Hung LeHong, research vice president at Gartner. "Retailers developing a B2C mobile phone strategy must enable a multichannel shopping process as well as driving m-commerce revenue."
LeHong said that a few of the more-likely shopping activities that consumers will want to do on their mobile phones, such as finding stores and checking prices, will be provided by portals and price comparison engines. He advised retailers to ensure that they were aware of the options that exist in working with these portals, mobile map providers and comparison engines.
Gartner undertook a survey of more than 2000 consumers in the US and the UK to assess the likelihood that they would undertake mobile shopping activities, from price checking and product browsing to ordering and paying for a product from a mobile phone.
Key survey findings:
* Consumers are more likely to shop rather than to buy from a mobile phone. In the US, consumers were twice as likely to check for prices of items as to buy items from their mobile phone (24% were likely to check price, and 12% were likely to buy on a mobile phone). UK consumers posted similar responses (18% check price and 11% buy).
* Checking item prices and finding stores are two shopping activities particularly suited to consumers on the go. These two activities were in the top three activities to be done on a mobile phone in the US and UK.
* Openness to receiving promotions on a mobile phone ranked third in the US and fourth in the UK. 20% of US and 16% of UK respondents stated that they would be likely to want to receive promotions on their mobile phones.
* The younger the consumer, the more likely he or she is to use the mobile phone to conduct retail activities. In the US, the 'digital native' respondents (ages 18 to 27) were, on average, 1,98 times more likely to do mobile shopping activities than the 'boomer' generation respondents (ages 43 to 61). In the UK, the digital natives were on average 2,63 times more likely to do mobile shopping activities than their boomer counterparts. This is consistent with the assumption that mobile use in the UK is considered more advanced than in the US.
* UK consumers were slightly more conservative in stating their likelihood to use the mobile phone to shop, but the relative ranking of the preferred activities was very similar to US consumers.
"M-commerce technology vendors should differentiate themselves by providing multichannel capabilities, such as enabling mobile-phone-generated orders to be picked up in a store or allowing consumers to save mobile-phone-created shopping sessions to be later continued on a Web browser," LeHong said.
For more information contact Lisa Lawlor, Gartner Africa, +27 (0)21 790 3526, lisa.lawlor@gartner.co.za


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