April 8, 2015
Global m-commerce revenue has nearly reached the $500 billion mark, with Asian countries accounting for almost half of that. There are over 200 million mobile consumers in China alone. Considering India’s mobile commerce market, the number of mobile shoppers, as part of the overall online shopping market, has grown from 20 percent to over 50 percent. For the U.S. itself, emarketer predicts that in 2015 around 22 percent of retail commerce sales will come from purchases made on mobile devices. M-Commerce is growing so fast that I expect retailers/commerce players shifting their complete focus from web apps and desktop websites to mobile apps and mobile sites. We have a few examples for you below.
Because of the rapid increase in smartphone and tablet penetration, the growth in mobile commerce is going through the roof. With phone screens becoming bigger (yes, even iPhones) people are buying while they are on the move and even buying on mobile at home. According to data from Monitise on m-commerce, mobile is growing at about 3 times the rate of e-commerce. Mobile accounts for 20 percent of the online purchase volume worldwide. Further insights reveal that 64 percent of mobile shoppers rely on apps instead of mobile browsers. Mobile Commerce also allows brick and mortar retailers to engage the customers when they are near the store or in-store using proximity marketing technologies. Location based notifications is another thing that comes into play when you are shopping online.
In this article, we highlight three examples of how crucial m-commerce has become for the entire industry:
Myntra now mobile-only
The online fashion retailer from India is shutting down its website on May 1st, and moving its entire operation onto its mobile app, as reported by Times of India. Myntra’s mobile application accounts for 80 percent of its traffic and 70 percent of its sales. The company is expecting that sales through the mobile app will reach 90 percent by the end of the year, hence there is no point in managing the web interface any more. Myntra is currently owned by India’s e-commerce giant Flipkart, which acquired the company for $333 million last year.
Myntra has already shut down the mobile website, and those accessing it are directed to the respective app or prompted to install the app. Myntra is the first such Indian e-commerce company to switch entirely to a mobile app platform. In India, online shopper penetration, as a percentage of internet users, is expected to increase from 9 percent in 2013 to 36 percent in 2020, primarily led by mobile users, according to a report by Morgan Stanley.
Now in the case of India what you have to know is that Mobile internet users in India are estimated to be 120 million compared to 100 million users using internet on their personal computers.
Mobile Commerce Startups Make Hay While Sun Shines
Mobile commerce companies, especially startups, are drawing in huge investments and demand. As an example, Tapingo, which offers an interactive mobile ordering app, has recently secured a $22 million investment from high profile investors such as Qualcomm Ventures, Khosla Ventures, DCM Ventures and others. Tapingo currently serves college students in the U.S. and has a prominent presence on over 85 North American campuses. On a daily basis, Tapingo handles over 25,000 transactions.
Tapingo is looking forward to using the fresh funds to expand its user base beyond college users and enter the mainstream mobile commerce market. As part of its new initiative, the company has already started testing a new delivery service and plans to expand further beyond its focus on food. Tapingo has raised $36 million so far and is looking forward to using the capital for product development, operations, and marketing. Tapingo is indeed an exciting case of how m-commerce companies are drawing in the real power within the overall commerce arena.
Champs Sports’ mobile sales witness massive growth
Champs Sports operates around 540 retail stores across North America. Last year, the retailer employed a responsive web design in order to enhance its mobile-driven content. The retailer witnessed massive growth of 183 percent in mobile commerce sales following the new initiative. The company also witnessed a 75 percent increase in mobile visitors as well as 170 percent increase in repeat visits. Moreover, the conversion rate rose by 33 percent after the focus on mobile was increased.
The retailer had established partnerships with lifestyle publisher Complex Media in order to boost the mobile interface and drive more traffic. The retailer has also been actively using a variety of mobile advertising techniques, which include videos, in-app ads, and mobile display ads. This particular case of Champs Sports clearly shows that with clear focus on mobile oriented channels, retailers can witness a significant jump in sales. What’s interesting here is that this traditional brick-and-mortar retailer focused more on enhancing the mobile interface rather than the website interface.
Let me know what you think about the growth of Mobile Commerce?