Mobile commerce is on the up-and-up but that doesn’t mean that it has a smooth, paved path to widespread adoption. There are serious wrinkles that need ironing, according to Retrevo and a CBSNews.com article on M-commerce.
The latest “Retrevo Pulse Report” for June shows that 20 percent of more than 1,000 respondents said they had purchased something from a retailer using their cell phone, up from 10 percent in February.
Nevertheless, 27 percent said they haven’t but will, while 53 percent haven’t and don’t ever plan to.
Of the group of respondents who had purchased something from their phones, 42 percent said that they made transactions via apps, with male shoppers outnumbering female shoppers. Not surprisingly, iPhone users led the way.
However, it appears that where apps make things easier for M-commerce, payment methods make do the opposite. In response to the question, “What would make you more likely to purchase something from a retailer using your cell phone?” 24 percent said not having to provide their credit card information, 13 percent said if their credit card information was stored with the retailer and 16 percent said they were already comfortable.
“Note to retailers: if you want more sales from mobile customers, make it easy for them to store their credit card info and while you're at it, keep your eye on retailers like Amazon with innovations like PayPhrase or Mobile Payments Service that might take some of the friction out of online or mobile transactions,” Retrevo’s blog post on the study notes.
The company wonders whether carriers will get into the mobile-payment business, which has already taken off in Japan. Verizon Wireless announced its plans to roll out an e-commerce payment service with the help of Danal for its mobile users. Online merchants, especially gaming companies, are expressing keen interest in the offering.
“Mobile commerce is here and gaining ground fast as mobile devices and apps make it easier for consumers to press the ‘buy’ button,” according to the blog post. Despite its growing popularity, we have to wonder if consumers might be apprehensive about transferring credit card info using their phones. If retailers want more business from smartphone toting shoppers they'll need to improve the process.”
A CBSNews.com article written by Evan Schuman highlights another potential pitfall for the burgeoning world of M-commerce: bandwidth issues.
If Steve Jobs can’t avoid them in a WWDC presentation, it’s not surprising if retailers can’t either. Schuman describes a scenario where a major retailer launches an M-commerce event only to have it falter due to too much traffic clogging up the available bandwidth.
“I wonder when people will realize that mobile devices communicate via, ummm, radio?” an IT executive asked Schuman.
M-commerce is something of a catch-22, according to Schuman. If a mobile-payment app succeeds, it’s likely to fail because of the weaknesses of radio signals and bandwidth.
Wi-Fi is a solution, but it requires the seller to pay for service and presents security and security-perception risks.
Sources:
http://www.retrevo.com/content/blog/2010/06/connected-consumer-and-future-mobile-commerce
http://www.computerworld.com/s/article/9173867/Verizon_Wireless_set_to_launch_mobile_payment_service
http://www.wirelessweek.com/News/2010/06/Business-Merchants-Danal-Billing/
http://www.cbsnews.com/stories/2010/06/11/tech/main6571717.shtml
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