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Consumers uncomfortable with mobile commerce: Study

An asknet Inc. survey of 400 smartphone users in the East and West Coast regions found that consumers are frustrated by the cost, accessibility and mechanisms supporting mobile commerce.

The survey was conducted simultaneously in Boston and San Francisco and found that 29 percent of consumers said they were uncomfortable entering credit card details for mobile purchasing. Despite predicted growth in the mobile commerce sector, asknet’s survey indicated that there are consumers that are still not ready to make payments via the mobile channel.

“It shows that users are willing to use their mobile devices more and are keen to try mobile commerce, but are frustrated with the process,” said Aston Fallen, president of asknet, San Francisco. “Many of the solutions that the market currently offers are not very user friendly.”

Asknet is a provider of ecommerce distribution services for software companies such as F-Secure, DivX and Nero.

F-Secure has used asknet’s mobile shopping cart to sell its security software through its wireless shop since it was first implemented in December 2007.

Mobile frustration
The survey found that 38 percent of smartphone users said they were frustrated with the high cost of applications.

When asked why they did not buy applications such as music, games, consumer software or business applications for their phone, 34 percent of consumers said that it was not worth the time or effort.

Almost half of respondents, 45 percent, said they had never bought applications or software for their smartphone.

Of the 55 percent that had bought software or applications for their smartphone, more than 87 percent had spent less than $50 in a year, 9 percent had spent $51-100, 3 percent had spent $101-150 and 1 percent said they spent more than $150 a year on applications and downloads.

Mr. Fallen said the fact that more than half of respondents had purchased software or an application for their smartphone was surprising considering the indicated frustration.

“It demonstrates that users want more of a mobile shop approach from service and application providers,” Mr. Fallen said. “The market needs to step up.”

Of the consumers that indicated they had bought items, 61 percent had bought music in the last year, 41 percent had bought games, 35 percent ringtones, 33 percent news, 29 percent GPS or location-based software and 27 percent had bought business applications.

Sixty-three percent said they would spend more money on music, 51 percent said they would buy more business applications, 48 percent wanted access to GPS applications and 37 percent said they wanted to buy games.

In terms of smartphone models owned, the asknet survey found that Research In Motion’s BlackBerry and the Apple iPhone topped the list.

More than half, 53 percent, of those polled in Boston said they owned a BlackBerry, 37 percent said they owned an iPhone and 10 percent said they owned another brand.

In San Francisco, 41 percent owned another brand of smarthphone, 34 percent owned a BlackBerry and 25 percent owned an iPhone.

The top three wireless network providers were AT&T, Verizon and T-Mobile, with AT&T leading in responses at 43 percent, followed by Verizon with 31 percent and T-Mobile at 19 percent across the survey.

Ready and waiting
Asknet said there is willingness to spend, but at the moment it is very conservative with small annual average revenue per customer.

More user-friendly ways to purchase will result in a huge increase in spend, Mr. Fallen said. 

Consumers want the applications, asknet said, they just need an easy way to shop.

Mr. Fallen said the biggest item holding back mobile commerce is difficult payment mechanisms.

“Users want a simple and straightforward buying experience,” Mr. Fallen said. “[Retailers] don’t miss the opportunity to be part of the mobile community.

“Seize the market and revenue opportunities now,” he said.