m-Commerce on the move

Market research firm, IDC Retail Insights, predicted that of the $447 billion in predicted U.S. holiday spending this season approximately 28% will be using mobile commerce while on the move in the aisles and in shopping malls. A survey of 1,000  revealed that consumers armed with smartphones are relying upon online product reviews and recommendation which they "dial-up" while on the move. That ratio has only one direction to go: up. The US is, far and away, the country with the most smartphones per capita and by Christmas of next year 50% of Americans are expected to have a smart-phone according to market research giant, Nielsen.

 

m-Commerce in the hospitality industry appears not to lag far behind per a recent study by the UK media planning leader, TotalMedia. The study of 1400 young adults showed that mobile phone apps are increasingly important in their holiday planning. However, the 44% who expressed an inclination to book on the move clearly possessed a thin wallet and were slim on experience. Unsurprisingly, the caveat was that they were willing to do so as long as the travel-related app free.

 

The UK study, done a year ago, but just released also had some other notable aspects to it. More than three times as many of the sample set sought the opinion of a friend via text when planning a holiday as used mobile a app. Also interestingly,  was the substantial regional differences in behaviour. People from a major metropolitan area (London) were considerably more likely to use their smart-phone.

 

TotalMedia concluded that "Mobile is now a mainstream channel for travel brands and they need to embrace it, whether it’s through optimising a site for mobile usage, developing apps that provide holiday inspiration or sponsoring successful ones. The fact that older consumers are more attracted to the free, sponsored apps and young people will actually pay for valuable online content opens up a huge opportunity."

 

The UK study, while indicative, is nevertheless, from a year ago (and country specific) which is more than a generation old in the fast changing world of m-Commerce. While there are no recent studies in the US on the pick up in actual bookings via smart-phones the fact that nearly every hospitality major has an app probably underscores its importance as the new distribution mechanism. That can only become more of an imperative given the fact that smart-phones are on the verge of "thinking" as per this article in Gigaom.com.  Using chips that enable location-based services smart-phones are likely to change their profile and "suggest" a new cocktail while a guest is poolside or the latest varietal while in a fine dining restaurant.  The possibilities for revenue enhancement seem limitless.

Published by

Vijay Dandapani

Co-founder and president of a New York based hotel company for 24 years. Grew the firm to five hotels in Manhattan and also developed a greenfield project at MacArthur airport, New York. Speaker at numerous prestigious forums including Economy Hotels World Asia, Lodging Conference, NYU, Columbia University Real Estate Roundtable, Baruch College's Zicklin School and ALIS. President and ceo of New York City Hotel Association since January 2017.

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