The future of mCommerce is promising if we look at the trends, especially in Covid 19. There are certain trends and technologies which is driving this growth.
Who would have thought that one would have access to millions of books and could order any book with one click on their mobile app until Jeff Bezos built the first online bookstore? At that time even the internet was in its infancy let alone the mobile technology. Fast forward to today, mobile technology has passed through revolutionary changes; be it the smartphone evolution or high-speed network compatibility.
Mobile phones have become a bare necessity for people; they socialize on the mobile phone, make purchase decisions on their smartphone, pay through mobile wallets, and whatnot. On the other side, If we look from the business perspective, it has become vital for business owners to leverage the potential of mobile phones for better business. Business owners will have to rise above the mentality of “ it is enough to have a website” and include m-commerce (Mobile commerce) in their business strategy- of course, having an online store is as important as having a mobile app.
This article is all about the future of mobile commerce. We will also know what has happened in mobile commerce since COVID 19 hit the world. But before everything else let’s get an overview of mCommerce.
What is m-Commerce?
M-commerce, an abbreviated form of mobile commerce, is a business process or purchase that happens over mobile devices such as smartphones and tablets. You can think of m-commerce as a subset of e-commerce. The only difference between eCommerce and Mcommerce is the way the purchases happen.
eCommerce refers to the business process and purchase activities conducted over the internet using laptops and PCs; it can not provide mobility to its users and that is where the role of mCommerce comes. M-commerce is location independent and provides the freedom to users; they can browse, shop, and make payments on their mobile phones without any hassle. You can think of mobile commerce as the future of eCommerce.
Some Important mCommerce Stats
- The global mCommerce revenue is surmised to reach at $3.56 trillion by the year 2021.
- mCommerce’s share in all eCommerce is anticipated to touch around 72% by 2021.
- Mobile phones are the prime choice of buyers for shopping online; around 48% of people search for a product or a service in Google through mobile devices.
- 77% of US shoppers compare prices on their mobile devices before purchasing from the physical store.
- A retailer who has not yet implemented a progressive web app or mobile app is losing a massive amount of revenue and potential customers every month.
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What is Driving the mCommerce Growth?
There are certain factors that have fueled the growth of mCommerce in recent times. From the excess usage of mobile phones to the COVID 19 effect, everything has impacted the mCommerce industry. Let’s elaborate on those elements.
Proliferation of Smartphones
Over the last few years, there has been an exponential rise in the number of mobile phone users. According to Statista, In the last 5 years, about 1.4 billion smartphones were sold around the world.
In 2019 the average US adult spent about 3 hours 43 minutes on their mobile device. The time spent on a mobile phone is expected to reach up to 3 hours 54 minutes in 2021. From setting an alarm to booking a cab to paying their electricity bill, people are excessively becoming dependent on their smartphones.
This has appealed to a lot of business owners to think about mobile owners. They know if they could effectively utilize this channel, they could rake in a good business. So, the proliferation of smartphones is certainly a reason for the eCommerce boom.
Consumer Usage Habits
Other than the usage of smartphones, the behavior of the consumers has also driven the m-commerce growth. Gen X, Millennials, and Gen Z are behaving differently for their daily purchase decisions. Where Gen X is more inclined towards physical stores for shopping, millennials are the ones who spend the majority of time on online stores for shopping. Of course, millennials are also influencing their family members in making purchase decisions.
Being a millennial, I do my 90% of shopping online. I also buy my stuff from the brick and mortar store but I do a lot of research on the online platforms. Still, you don’t need to consider my opinion. Here are some facts that could further reinforce your trust in the current behavior of the people towards online shopping.
- Only 9.6% of Gen Z buys their stuff from the physical store.
- Millennials and Gen Z both spend their dollars on the products found from Instagram and Snapchat.
- More than 57% of millennials compare prices, do research, and make their final purchase on mobile devices.
- 63% of millennials transact for their shopping on their smartphones.
- Free shipping, convenience, and price are the 3 important reasons why US shoppers prefer to purchase their things online.
The above-mentioned facts undoubtedly suggest consumers’ increasing interest in mobile commerce.
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Mobile Apps Have Become a Go-to Way of Commerce
Whether you believe it or not, people’s obsession with mobile apps has drastically increased over time. According to Statista, the number of app downloads was 204 bn in 2019. That same report has claimed that As of 2020, on the Google play store there are over 2 million mobile apps available. That count is 1.83 million for the Apple App Store. This clearly shows consumers’ interest in mobile applications.
Robust user experience is also one reason why people choose mobile apps over mobile responsive websites. Mobile websites are good but they are not the best. There are better options that provide the experience users want while doing online shopping. Progressive web apps (PWAs) and Native mobile applications fall into this category.
Where PWAs are the budget-savvy option for small retailers, native mobile apps guarantee a faster and seamless mobile experience to consumers.
Innovation in Payment Technologies
Till now, credit card and debit card have been a preferred payment method for consumers. And still, it is being used in an excessive manner.
However, the genesis of mobile payment gateways and mobile wallets has turned out to be a game-changer. Customers have found a more convenient and easy way to pay for their bills and purchases. More importantly, they don’t have to stand in a queue at the billing desk to pay the bill for their purchase. They can instantly scan the barcode attached to the billing desk and pay through their mobile wallets. No change problems!
We will see mobile wallets and mobile payments in detail ahead in the article, but for now, it is vital to know that the need for a faster and secure payment system has further pushed the m-commerce growth.
COVID 19 has become a driving force in many of the changes happening in our life, be it the first time experience of work from home or staying inside the house for months. It has certainly impacted retailers and other businesses. People definitely couldn’t go to malls, stores, and supermarkets to buy household items. The only way people could get access to these items was through online orders and delivery.
According to the research of PYMNTS, customer purchase and payment is increased in 2020 by 34.9% in comparison to 2019. Also, consumers are more and more using mobile devices to look for discounts and deals as well as compare prices during these times. Therefore, Covid 19 is surely a driver in mobile eCommerce growth.
Present and the Future of the mCommerce
If you are a small business owner or a retailer or even a startup finding a way to ensure a thriving business, you can not ignore mobile users. And to attract them, you need to embed the latest mCommerce trends into your business. Apart from the current trends, we have also listed some of the trends that are in its infancy and will have a great impact on the businesses.
Let’s check them out, so you have a clear picture of the future of retail eCommerce.
Marketing plays an indispensable role in any business’s success. Whether you are running a brick and mortar store, an online retail store, a subscription-based service, or an on-demand service, you want to reach your customers where they are. Smartphones make it convenient for you to target your customers no matter what their current location is. Isn’t it amazing to let the customer near your store know about the new product you have added to your store?
Location based marketing allows business owners to make strategies that can be applied throughout the customer lifecycle-From discovery and purchase, to engagement and retention. With proper planning, businesses can send personalized offers to users’ mobile devices.
Mobile retargeting is also a part of Location-based marketing but it is a broader concept that you will see implemented more and more in the near future.
Advertisements are annoying and putting them at random places could irritate your customers. But mobile retargeting is different. It allows marketers to target ads contextually; it makes it possible for marketers to target only potential customers and influence them in their buying decisions.
For example, an active mobile targeted ad will be shown to the users who have entered a certain area or in the proximity to the store.
Further, mobile retargeting has a better RoI compared to other advertisement platforms. So, in the near future, businesses might prefer it more.
AR on Mobile
AR(Augmented Reality) and VR (Virtual Reality) have been the trending buzzwords for the last two or three years. In 2019, the installed base of apps with embedded AR was at 2282.2 million worldwide and is expected to grow further in the near future.
Retail giant IKEA has strengthened its brand name by including AR mobile application. For better and rich user experience, IKEA created AR models of their furniture items so that customers can apply those models directly through their mobile application and see whether the piece of furniture fits into their homes/office or not. Not only IKEA but brands like Coca-cola, Zara, Pez, and Covergirl have also leveraged the power of AR in their mobile application.
61% of online shoppers prefer stores that offer AR experiences.
If shoppers could experience products in AR, 71% would return more often and 40% would pay more. — Retail Perceptions
Technologies like AR ensures that your business stands out among your rivals. Also, people always get attracted to new experiences and trends, so AR is definitely the present and the future of Mcommerce.
As more and more people are accessing websites from mobile phones, it has become imperative for business owners to make their website mobile-friendly. If in any case the website is not mobile responsive and doesn’t provide the best possible experience, the visitor leaves the website halfway. This in turn increases the bounce rate. And Google doesn’t like the website with higher bounce rates.
So, marketers will have to ensure that whatever web pages they are creating for their online store should be mobile responsive.
AI, Chatbots, and Shopping Assistants
Chatbots have become an essential tool for eCommerce businesses for things like:
- Helping buyers complete the purchase
- Offering product recommendations to buyers
- Providing customer support
These round the clock chatbots are powered by AI (Artificial Intelligence) technology. They work as a shopping assistant when the customer support representative is not around.
About 8 out of 10 consumers who have interacted with the chatbots reports it as a positive overall experience. Also, according to a Grandview research report, the global AI chatbot market is expected to reach $1.23 billion by 2025.
Consumers’ rising inclination towards chat messengers is surely the biggest reason for Chatbot’s growth. They are accustomed to chatting with their friends and family over chat messengers like WhatsApp, Telegram, Facebook messenger, etc. So for them interacting with shopping assistants or chatbots is easier and faster.
Mobile banking refers to the ability to transact money from mobile devices (Smartphones, tablets, etc). It allows you to send money to the other parties irrespective of their location. It doesn’t only let you transfer money to peers but you can also transact your money to the banks. The plus point of mobile banking is that you can send money anywhere, anytime. The only disadvantage is that people find it a little bit unsafe transacting big amounts on mobile phones.
With 25 million active users of their mobile banking apps, the BOA (Bank of America) is still the leader in the mobile banking sector. So without a doubt, we could see a surge in mobile banking usage in upcoming years and is one of the future trends in m-commerce.
We have gone through some facts on mobile payments earlier in the article. Let’s scratch the surface and go a little deeper about mobile payments. As mentioned earlier, Mobile payments are becoming more and more common among all age groups. Especially due to covid 19 people have become more cautious about social distancing and they are preferring mobile payment apps like Venmo and Zelle for paying whatever they are purchasing.
As per the latest research on mobile payment systems, the mobile payment market is expected to touch $3081 Billion by 2024. It stands to reason as more and more shoppers will use mobile phones for shopping and other transactions.
Cloud Computing in eCommerce
The number of innovative startups using cloud technology is increasing at a rapid speed. And there will be myriads of cloud-based solutions in the coming years as well.
Cloud solutions allow the business person to scale the solution as the number of users grows. Also, Cloud technology reduces the overall cost as the owner only pays for what he uses. Most of the cloud-based solutions come with mobile applications so users have better accessibility of particular solutions.
One area that is blindingly benefited by cloud computing is e-Commerce. Cloud-based solutions like single vendor eCommerce and multi-vendor e-commerce will provide a seamless experience to the shoppers. These kinds of business ideas will also be beneficial for startup owners and retailers.
Your favorite singer is in town for the concert, the tickets are available online, but the concert date is just two days away. In the past, you would have to pay a steep amount of delivery fee and wait in a long line to get the ticket. But not anymore.
Mobile ticketing is a new approach in selling the ticket; you get your ticket directly in your smartphone. You don’t need to print it out. The ticket you receive comes in a text format with a barcode on it. When you attend the concert or event, your ticket will be scanned.
So, Mobile ticketing is also the future of mobile commerce.
The above-mentioned trends are certainly going to be prevalent in the coming days. As a retailer or a startup, it would be a prudent decision to incorporate appropriate technology in your business. If you own a restaurant or a retail store, you might want to think about an AR-based solution.
If you already have an online store, you should go for mobile app development and serve your customer irrespective of their location. Incorporating mobile payment gateways and Chatbots would also elevate your business. In short, the future of mCommerce is bright and it would be wise you embrace these positive changes.