mCommerce: Not all it is cracked up to be?

Late last week a Forrester analyst released a portentously titled report “The Mobile Commerce Train: Coming But Not Here Yet” that immediately garnered considerable attention particularly in the retail world where sales via mobile devices could expect to reach a nearly invisible figure of 2% of total web sales for this year. The report notes that massive year-on-year growth for the next 5 years of 40% per annum will still see that 2% grow by a mere 5 points to 7% by 2016.

Forrester’s analyst does point out that the anemic figures for mobile are somewhat misleading due to the fact that shopping via tablets is not included in those numbers and that folks tend to use their mobile more for reading the news and social media than shopping. Further “when consumers do use their mobile phones in a retail context, it is to look up product information as they are in the midst of researching products in a physical store, or to compare prices, which often leads to a customer demanding a price match.” It is the latter that tosses up a quandary most marketing professionals have run into as the vast array of customer touch-points, including mobile, makes resource allocation for ad dollars a stern challenge.

Nevertheless, recognizing that customers don’t respond in a linear way and, in fact, use multiple marketing stimuli ranging from coupons to TV ads and live-chat before making a purchase is at least one reason to not let the ad and development budget for mCommerce to flag. The sheer ubiquitousness of mobile phones only makes the argument more compelling.

One elementary but effective use of mobile phones for marketing has been the 160 word bounded SMS message. Airlines (a pioneer) to fast-food purveyors have successfully used it to engage clients with a view to enlarging their customer base.  A recently released primer ( Download Neustar) on “Smart SMS Marketing” from neustar, a provider of clearinghouse and directory services to the global communications and Internet industries focusses on SMS’ potential for the Travel, Tourism and Hospitality industry. Apart from airlines, hotels & resorts and restaurants neustar’s white paper points out that targeted marketing specialists like CTM Media Group have reaped rewards by taking advantage of SMS marketing. Others such as Dunkin’ Donuts have come up with creative ways to engage customers by using an interactive mobile advertising banner to increase consumers’ knowledge of its brand while letting them find out their coffee IQ through questions such as the origin of a strain of coffee beans. Tourism agencies too have climbed aboard the SMS bandwagon with the Pennsylvania Tourism Office running a tourism promotion for Groundhog’s Day.

Beyond SMS for marketing, mobile phones can even be used as hotel room keys as a recent Wall Street Journal article detailed. Hotels send incoming guests their room number via text message (or email) They also receive a phone number to dial in the text. Upon reaching their room they dial the phone number which accesses a remote server and which then sends an audible tone to the phone. Puting the phone’s earpiece next to the lock opens the door.

The game-changer in this and most other eCommerce debates is undoubtedly Google with its Google Maps for mobile. With the ability to conjure up a list of providers of services and products along with rates in the vicinity of the mobile user. Not only does it provide a clear path to the customers’ journey its Click-to-WAP and Click-To-Call features will ensure that mCommerce like customer purchasing behavior cannot be projected linearly and web purchases via mobile arguably will see greater growth than that projected by Forrester.

 

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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