April 10, 2012

mCommerce 2012

by Hisham Isa, Vice President (Marketing)

Even with a generic feature phone from a company like Zen Mobile in India or MTK Mobiles in China, I can easily go online to check train schedules, buy tickets and shop for a variety of items from ringtones to hardback books.

Mobile Commerce is a major factor driving growth in the mobile industry right now, from the time that consumers spend online to the number of ads served every day.

In a BuzzCity survey of seventeen countries across four continents, one-quarter of respondents say they conduct a mobile transaction every day.

But carriers and advertisers are largely neglecting two key market segments: women and 'mature' users, particularly those over the age of 35.

Demographics: Young and Male?

While it's true that most mobile surfers are male (nearly 3/4 of the respondents in our survey), this stat is deceptive. There are nearly as many women as men using the mobile web in the UK (49%), Thailand (43%) and South Africa (40%), all of which are Top Twenty markets for BuzzCity. Women comprise one-third of mobile surfers in a number of other markets, including France, Germany, Mexico, Philippines, Saudi Arabia and the US.

Yet there are far too many carrier ads like this one, which completely neglect women:

Similarly, there's a perception that mobile growth is driven by young users. Of course, there's a grain of truth here -- under-20s are still the biggest market segment (28%) -- BUT over-35s account for 15-20% of all users in a number of key markets, including France, Germany, Malaysia, Poland, South Africa, UK and the US. And more importantly, the influence of these older users is disproportionately high when mobile purchases are taken into account. In France, for example, over-35s comprise 30% of the market yet account for 67% of gadgets purchased via mobile.

Some carriers are starting to catch on. Check out this ad from India, which targets women and men, young and old.

Carriers in other countries need to take note: neglecting women and 'older' users will impact growth and your bottom line.

Mobile Purchases

So what are mobile consumers buying?

The most popular purchases are mobile-related: 65% of mobile users have bought phone credits; nearly half have purchased mobile content.

Travel tools are booking services are heavily used for flights, buses, trains and hotel accommodation - when they are available. And our survey respondents indicate strong interest in buying electronics, small appliances as well as physical media products (books, movies and music) for delivery.

"What's mCommerce? Is it safe? Really?"

You can't expect consumers to make an online purchase if they don't even know the option is available. Here are a few stats that carriers and marketers should keep in mind:

  • Surprisingly - or perhaps not so surprisingly since we've written about this before - 35% of users aren't aware of the basic mobile transactions available.
  • Twenty-two percent have never conducted a mobile transaction.
  • More than 20% find mCommerce to be too complicated.
  • And security is still a major concern for many.
Keep it simple and give offline options

First, brands should make mobile a fully-integrated component of their offline strategies. A lot of consumers still prefer to make payments in person. So until users become more comfortable with cashless transactions, offer them mobile-only coupons and loyalty programmes that can be presented for redemption in your physical store.

Second, provide more product information online. In particular, services that are likely to do well are:

  • Product review sites and consumer forums
  • Comparison shopping services
  • Discount sites and coupon services
  • Price aggregators
  • Classified Ads
Third, for the consumers who make mobile purchases, provide post-purchase tracking services. This will go a long ways to overcome consumer anxiety. Banks and merchants also have a key role to play here to reassure their clients about the safety of mobile transactions by using SMS notifications and enabling balance inquiries.

There is no single mobile commerce solution. But that's part of its beauty. mCommerce is supported by everything from apps to SMS and traditional marketing to QR codes. This market segment is growing rapidly . . . and it will grow even faster when carriers and brands include women and people of my age in their marketing plans.

Related Article
"Mobile Ad Growth"