Magazine article CRM Magazine

Mobile Commerce: The New Retail Therapy: Shopping Trend Empowers Consumers and Challenges Business Strategies

Magazine article CRM Magazine

Mobile Commerce: The New Retail Therapy: Shopping Trend Empowers Consumers and Challenges Business Strategies

Article excerpt


SHOPPING SPREES soon may have nothing to do with admiring mannequins adorned with the latest fashions through store windows. Instead, whipping out your smartphone without taking a step outside the comfort of your own home could be the future definition of retail therapy.

Mobile commerce is on a dramatically steep rise. Forrester Research estimates that 53 percent of mobile customers will most likely increase their mobile spending budgets in 2011, with only 4 percent reporting they will decrease them. Another study, conducted by ATG, revealed that 48 percent of U.S. consumers are using their mobile devices to research and browse products and services, up from 37 percent in July 2010 and 27 percent in November 2009.

In addition, 29 percent of consumers polled have made at least one purchase on a mobile device--more than double the number reported in November 2009.


"We are doing almost everything on a mobile device; that's just the direction of the world," observes Michael Fauscette, group vice president of software business solutions for IDC. "We are always connected. We have evolved into having the constant interactivity of the Internet, so it's just natural that I want to take the next step and want to do some type of commerce, or I want some customer experience tied into the mobile device as well as other things."

Forrester's study also asserts that mobile marketing is at a "crossroads." As a result, marketers will need to stop experimenting with an array of mobile marketing techniques and commit to "firm strategies." With only 23 percent of marketers intending to spend more than $1 million in the mobile space this year, analysts warn about the potential dangers of ignoring the demand. Instead, understanding customers' buying patterns and the benefits of mobile shopping are considered vital when developing a mobile marketing plan.

As smartphones become smarter, this always-on environment has bled into retail, begging the question: Will shopping dates one day resemble renting a VHS from Blockbuster?


Suddenly, mobile devices are exactly that: devices. Gone are the days of just carrying cell phones; instead these tools now manage several aspects of people's everyday lives.

"I can remember the phone I had in 2004, and there wasn't a whole lot of shopping going on it," jokes Andy Lloyd, general manager of e-commerce products at NetSuite. "It wasn't a very good user experience, the network was slow, and the screen was monochromatic."

However, because of breakthrough technology in mobile phones and their browser capabilities, Lloyd says, mobile commerce is "empowering" consumers, giving them a broader span of choices with which to make sound buying decisions. "Now, all of a sudden, the consumer is in charge," he explains. "It's something that retailers need to be cognizant of, and it shifts the balance to the consumer. So it's up to the retailer to carry a quality product, a great shopping experience, and a good price, or consumers are going to go somewhere else."

Indeed, consumers have gone elsewhere on several occasions. Fauscette explains that during the past Christmas shopping season, Best Buy lost business when people standing in its stores took mobile reads of barcodes and found items priced more cheaply on; some ordered while they were still on the retailer's property. "That changes commerce significantly," he says. "If I can't even depend on the fact that somebody came into my store to think that I am going to sell that television or whatever, and they can shop me in real time against online and brick and mortar, then commerce has changed to a much more dynamic, connected environment."

As a result, Lloyd believes that mobile commerce "absolutely" will have an impact on in-store sales, and retailers are taking notice. "We have talked to our customers who previously had a significant kiosk presence in their retail store, and they said they are basically reallocating that budget to mobile," he says. …

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