Mobile Commerce To Grow Exponentially

As more consumers purchase and use smartphones, more retailers are launching mobile commerce sites.  One research shop, Coda Research Consultancy, is expecting exponential growth rates in the mobile commerce sector.  Other analysts are encouraging retailers to speed up their mobile commerce development plans, but progress has been slow for a numbers of reasons.

According to a recent Internet Retailer survey, 8.8% of retailers currently have a mobile commerce operation. Another 75.9% plan to launch one but cite the following problems:

  • Other e‑commerce priorities 34.5%
  • Limited funding 30.4%
  • Lack development expertise 23%

The survey also found that 50% of retailers with mobile commerce sites earn $50,000 or more from this channel. Other interesting metrics are:

  • Average sales ticket price $197
  • Average conversion rate 3.5%

Retailers point out that sales are not the only goal of their e‑commerce sites. These vendors also hope to use their sites to accomplish the following:

  • Improve marketing and merchandising 12.8%
  • Increase multichannel sales 12.2%
  • Improve customer service 10.1%

Sucharita Mulpuru, a vice president and principal retail research analyst with Forrester Research Inc. says, “The age of mobile commerce we are in now is akin to the business-​to-​consumer e‑commerce market of 1997.”

What may be different this time around is a shortage of financing for business models that don’t generate cash flow. So the rollout of mobile commerce may be slower than the e‑commerce boom prior to the 2001 recession but many businesses are experimenting with this new sales channel which means marketing dollars are sure to follow.

[Source: Brohan, Mark. Survey: Retailers’ mobile plans. InternetRetailer​.com. 1 Oct. 2010. Web. 11 Oct. 2010] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.