Mobile-savvy shoppers will account for $127B, 28pc of overall 2010 holiday spending: survey
Mobile-savvy shoppers will account for $127 billion or 28 percent of the $447 billion the National Retail Federation predicts U.S. consumers will spend this holiday season, according to IDC.
According to the survey results, mobile commerce and social media commerce are giving consumers greater advantages as they engage retailers on their own terms—even inside the store—within arm’s reach of merchandise at the moment of their buying decision. Mobile and social media commerce already has an influence on consumers’ perception of brand value and their shopping intentions, and the retailers with superior mobile and social media commerce strategies in place will have an advantage.
“Mobile commerce and social media commerce together will play a key role this holiday season,” said Greg Girard, program director of merchandise strategies and retail insights at IDC, Framingham, MA. “Mobile and social media commerce changes how we shop, not just when and where we shop, which is the change ecommerce drove—that is, shopping 24/7 from any Internet-connected computer.
“However, with ecommerce consumers engaged separate channels sequentially—some combination of ecommerce and stores to research, inspect and buy an item using one channel at a time,” he said. “With mobility, consumers can engage in both channels at once, as well as bring in social commerce, and they can do that inside the store, so the store is no longer a bastion of influence.
“Finally, mobility with social media brings the opinion of the shopper’s social network to bear anywhere a consumer is deciding to buy something or not—whether it be online or in front of the shelf in the store.”
IDC Retail Insights surveyed more than 1,000 U.S. consumers ages 19 years and older in September 2010 to determine how consumers will use mobile and social media commerce as they shop during the 2010 holiday season.
The income and demographic profiles of this sample are in line with the overall profile of the U.S. consumer population.
About 73 percent of those surveyed are members of Facebook or other social networks and 68 percent own smartphones.
The $127 billion estimate does not refer to actual payments made via mobile devices, but rather the amount of revenue generated this holiday season from mobile- and social-savvy consumers.
Mobile shopping warriors with money to burn
As revealed in the survey, mobile shopping warriors, highly connected consumers, and wannabies, moderately connected consumers, represent the vanguard for the new age of mobile commerce.
Of particular interest, results suggest that the early maturity adult audience is an important part of this vanguard.
Mobile and social media commerce is not just for twenty-somethings, per Mr. Girard.
Adults ages 25-44 comprised nearly two-thirds of the mobile shopping warrior group, while they comprised slightly less than half of consumers surveyed.
In addition, adults ages 45-54 were the most inclined to use their mobile information advantage.
For example, many consumers ask for a better price to match one they find on their mobile device while in the store.
The impact of mobile shopping warriors for retailers will be significant this holiday season as the survey reveals, across the board, retailers’ mobile commerce competence greatly influences consumer perceptions about the brand.
Further, an easy-to-use mobile Web site significantly influences consumers, across all age groups, on where to shop this holiday season.
Results also suggest that while the influence of social media outlets on buying decisions is growing, retailers continue to serve as the most important source of information on which consumers make their final purchase decisions.
As such, retailers who have met the critical need for consumer-generated Web site content and easy-to-use product information will have the advantage this holiday season.
Other key findings from the IDC Retail Insights survey include:
• More than one third of smartphone-carrying consumers, who represent 24 percent of all U.S. consumers, are ready to use their mobile devices in ways that transform how they shop everywhere and, in particular, how they shop in retail stores.
• New behavior facilitated by mobility, all of which can take place in stores, include searching for price and product information, checking merchandise availability and comparing prices at nearby stores, browsing product reviews and purchasing goods.
• Consumers using multiple channels sequentially as they move from Web to store will give way to concurrent omnichannel behavior as consumers bring their comfortable use of mobile commerce with them into the store. This new behavior will exert pressures that weaken the store’s immediate influence on purchase decisions “at the shelf.”
• In general, social media does not have widespread influence on shopping decisions, but friends influence one another’s shopping behavior on social networks and sites that have earned consumer trust will influence this behavior as well.
Convenience, necessity, technology
The quality of a consumer’s mobile experience affects his or her perception of the brand and decisions to shop one chain versus another, per Mr. Girard.
So, retailers and merchants have to invest in making their ecommerce sites mobile-friendly and delivering on-board smartphone applications. They have to figure out opt-in location-based CRM as well.
Finally, Mr. Girard said that they have to integrate mobility as the hub of their omnichannel strategy—the focal point that brings ecommerce, store commerce and social commerce together.
What is driving consumer adoption of mobile shopping tools? Convenience, necessity and technology.
“Smartphones add enormous convenience by enabling on-demand access to information a consumer needs while shopping anywhere,” Mr. Girard said. “Mobility increase price transparency and that helps a consumer get better deals, which is more important now as the economy staggers out of the Great Recession.
“Finally, smartphone technology will rapidly improve form factors like screen size and resolution and speed,” he said. “Retailers’ investment in making their ecommerce sites mobile-friendly will make navigation easier and even intuitive.”
Dan Butcher, associate editor, Mobile Commerce Daily