state of mobile commerce 2014 (sucharita mulpuru)

#monetatesummit

State of Mobile Commerce 2014

SucharitaMulpuru, VP and Principal Analyst, Forrester

© 2013 Forrester Research, Inc. Reproduction Prohibited

Agenda: 5 Questions

1.How big is m-commerce now? 2.What are shoppers doing on different devices? 3.How much of a problem is mobile conversion? 4.What is important to know about retail apps? 5.How much are companies investing?


What are the data sources?

›Forrester’s forecasts and consumer surveys ›Data on mobile shopping from Bizrate Insights from 2011-present ›Data from Shop.org: The State of Retailing Online surveys ›Commissioned thought leadership papers


Agenda: 5 Questions

›How big is m-commerce now? ›What are shoppers doing on different devices? ›How much of a problem is mobile conversion? ›What is important to know about retail apps? ›How much are companies investing?


First, some definitions (for these slides)

≠

Phablets, yes 200MM smartphone subscribers

Mini tablets, yes 100MM tablet owners

TabletSmartphone

MO

BIL

E


How much will phones generate in commerce?

2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$46$42$37$32$26$16

Source: Forrester’s Smartphone Commerce Forecast (do not distribute)

US Smartphone Commerce $B (Physical goods and media)


Other m-commerce categories make the figure even higher

2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$36$31

$26$21

$17$12 $46$42$37$32$26$16

US Smartphone Commerce $B

Travel and other services



How much will tablets generate in commerce?

2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$176$141$110$81$56$34

US Tablet Commerce $B (Physical goods and media)



The fully loaded tablet number

2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$39$33

$28$21

$15$8

$176$141$110$81$56$34

US Tablet Commerce $B

Travel and other services


© 2013 Forrester Research, Inc. Reproduction Prohibited Source: Forrester Forecasts; only includes physical goods and media categories

2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$222$183$148$113$82$50

Phone and tablet commerce ($B)

How this fares relative to the overall retail pie



2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$192$202$207$212$212$213 $222$183$148$113$82$50

Other eCommerce($B)

Source: Forrester Forecasts; only includes physical goods and media categories


2013 2014 (F) 2015 (F) 2016 (F) 2017 (F) 2018 (F)

$2,389$2,322$2,259$2,197$2,136$2,080

$192$202$207$212$212$213 $222$183$148$113$82$50

Non eCommerce/mobile sales ($B)


Source: Forrester Forecasts; only includes physical goods and media categories


The iPhone is still important for online buyers

2011 2014

69%54%

% of web shoppers owning smartphones Types of devices owned

Source: Bizrate Insights/Forrester Mobile Commerce Studies and Forrester Technographics 2013

Base: recent web buyers * Includes iPod Touch

49%

30%

3%

11%

iPhone*

Android-based phone

Blackberry

Other phone with web browsing


iPads dominate the tablet space

2011 2014

51%

12%

% of web shoppers owning tablets

Base: tablet ownersBase: recent web buyers

9%

16%

16%

55%

iPad Mini

Samsung Galaxy

Amazon Kindle Fire

iPad

Types of devices owned



Agenda: 5 Questions



Mobile devices are used everywhere“Where do you use each of the following devices to access the Internet?”

Source: The State of Consumers and Technology, Benchmark 2013, US


Time on tablets is cannibalistic of PCs

With the addition of your iPad/tablet to the devices that you already use to go online, do you spend more, less, or the

same amount of time online?

More time online Less time on PCsWith the addition of your iPad/tablet to the

devices that you already use to go online, how is your desktop computer/laptop usage

affected?

2011 2014

46%49%

2011 2014

48%47%

Source: Bizrate Insights/Forrester Mobile Commerce Studies


2011 2014

47%40%

2011 2014

49%41%

This applies to phones too

Since getting your smartphone/small screen mobile device, do you spend more, less, or the same total amount

of time online (including using your computer and other devices you access to go online)?

If you own both a smartphone/small screen mobile device and a desktop computer/laptop, then has the smartphone/small screen mobile device decreased the amount of time you use

your desktop computer/laptop?

More time online Less time on PCs



More consumers are buying on phones

Phone shopping breakout of smartphone owners

2011 2014

0%0%

0%0%

0%0%Buyers

Browsers

Non-buyers

% of shoppers owning smartphones 54% 69%

• Balanced between genders

• Heaviest buying among Gen Y and Gen X (under 44)

• $150k+ incomes slightly more than average



And of course on tablets too

Tablet shopping breakout of tablet owners

2011 2014

0%0%0%

0%

0%0%

Buyers

Browsers

Non-buyers • Buying balanced between genders

• Gen X heavy (30-44)

• $75-100k and $150k+ incomes heaviest tablet buyers

% of shoppers owning tablets 12% 51%



Top shopping activities on phones vs tablets

1 Read emails from retailers Browse or research products

2 Receive texts with special offers from retailers Read emails from retailers

3 Locate retail stores/hours/directions Compare prices while shopping online

4 Browse or research products Read product or store reviews

5 Download or redeem coupons Identify where products are sold

Please note which of the following you do with your mobile device(s) with respect to any online retailer.


© 2013 Forrester Research, Inc. Reproduction Prohibited Source: A commissioned study conducted by Forrester Consulting on behalf of VISA, September 2013

Where the shopping journey starts on different devices

Base: 1003 smartphone shoppers (research or purchase)

Search is important on all devices

26%

42%

54%

Email message from a retailer

I search for something specific on a retailer's site

I search for something specific using a search

engine

38%

60%

69%

27%

51%

57%


Email is also essential

81% of web buyers read emails on phones because the phone is

always with them; 48% like that the phone has no email login

67% of web buyers say that they were inspired to buy something after opening an email on a mobile phone

Desktop

Smartphone

Tablet 22%

37%

75%

I read promotional emails from [merchant X] on my…

Source: Bizrate Insights Industry Hot Topic Q4, 2013


Agenda: 5 Questions



Mobile conversion is generally terrible

August 2012 August 2013

Smartphone 0.6% 0.6%

Tablet 1.6% 1.5%

Desktop 1.9% 2.2%

Conversion rates of US retail websites

Source: Adobe Digital Index


Phones are just not easy for buyingHow easy would you say it is to complete an online PURCHASE using the device(s) listed below?

0%

0%

0%

0%

0%

0%

0%

0%

0%

0%

0%

0%

Very easy Easy Neutral Difficult

Type of device rated

Base: 834 consumers who purchased on PCs/laptops; 377 consumers who purchased on tablets; 640 consumers who purchased on smartphonesSource: A commissioned study conducted by Forrester Consulting on behalf of Visa, September 2013

© 2013 Forrester Research, Inc. Reproduction ProhibitedSource: A commissioned study conducted by Forrester Consulting on behalf of VISA, September 2013

Under $50

$50-$99

$100-$499

$500+ 3%

15%

26%

56%

Base: 1003 smartphone shoppers (research or purchase)

Transactions are smaller on phones too“About how much have you spent on products and services when PURCHASING on these

devices online in the past month? (Including shipping and handling.)

14%

34%

31%

22%

6%

21%

32%

41%


Mobile buyers are more likely to switch devicesThinking about [the last online shopping experience], did you use multiple devices during that experience?

Source: A commissioned study conducted by Forrester Consulting on behalf of Visa, September 2013

Multiple devices

49%

53%

23%

42%

PC

Tablet

Phone

One device

45%

Can’t recall

5%

One device

44%

Multiple devices

52%

Can’t recall

4% Multiple devices

39%

One device

54%

Can’t recall

7%

46%

36%

39%

PC

Tablet

Phone

53%

22%

43%

PC

Tablet

Phone

Dev

ice

switc

hed

to

whe

n sw

itche

d

© 2013 Forrester Research, Inc. Reproduction ProhibitedSource: A commissioned study conducted by Forrester Consulting on behalf of VISA, September 2013Base: 1003 smartphone shoppers (research or purchase)

“Why haven't you PURCHASED a product on your device?”

Shoppers often prefer PCs

Base: 228 mobile non-buyers Base: 89 tablet non-buyers

47%

58%

67%

I don't want to store my financial information on my

phone

It is more comfortable to sit at a computer and shop

The screen is too small

39%

43%

22%


Agenda: 5 Questions›How big is m-commerce now? ›What are shoppers doing on different devices? ›How much of a problem is mobile conversion? ›What is important to know about retail apps? ›How much are retailers investing?


These are the most common retail appsWhich of the following types of online shopping apps, if any, have you downloaded

to your smartphone/small screen mobile device?


42%

8%

15%

33%

I have not downloaded an

app

Fashion trends or tech reviews

Comparison shopping

Retailer-specific apps

2011 2012 2013 2014

41%

7%

15%

36%

37%

7%

16%

40%

33%

9%

14%

45%


Shoppers discover phone apps mainly through word of mouth

How do you learn about the apps that you install on your device?

Base: recent online buyers who own smartphones or tabletsSource: Bizrate Insights/Forrester Mobile Commerce Studies

14%

6%

11%

20%

21%

25%

59%

I don't install apps

Sign in a retail store

Retailer websites

An ad on TV/radio/print

The app store

Social media (e.g. Facebook)

Word of mouth (e.g. friends, family, colleagues)

12%

6%

11%

21%

26%

25%

55%

Base: recent online buyers who own smartphones or tablets


How do you learn about the apps that you install on your device?

›“My husband does it” ›“My children” ›“What I need at a particular time” ›“I ask teenagers”


© 2013 Forrester Research, Inc. Reproduction Prohibited #156

Few customers say they need a retailer’s appIf you have interacted with [MerchantName] on a mobile device, then which experience

do you prefer?


37 %

7 %

6 %

19 %

30 %

Accessing the standard website (i.e. the same view you would see on your computer)

Using the mobile version of the site (i.e. the site may have less content but is optimized to look

Using an app (if this retailer has one available for download)

I don't have a preference

I have never interacted with [Merchant] from a mobile device

© 2013 Forrester Research, Inc. Reproduction Prohibited#157

The challenges for apps remain large

›Apps can often be cumbersome to download ›Apps are difficult to fine ›Apps need to be upgraded ›Most apps do not get repeat usage ›Apps could be subject to privacy restrictions


Yet, more than 40% of mobile phone transactions happen on apps“Thinking of the last time you bought something on your smartphone, how did you complete your transaction?”

Source: A commissioned study conducted by Forrester Consulting on behalf of Amazon.com, January 2013

“Thinking of the last time you bought something on your [tablet or PC], how did you complete your transaction?”

Source: A commissioned study conducted by Forrester Consulting on behalf of VISA, September 2013

59%

41%

On a smartphone through a website

On a smartphone through an application

Base: 528 mobile phone buyers Base: 311 tablet and PC buyers (of non-phone buyers)

4%

14%

83%

On a tablet through an application

On a tablet through a website

On a computer

59%

41%

On a smartphone through a website

On a smartphone through an application

Base: 528 mobile phone buyers Base: 311 tablet and PC buyers (of non-phone buyers)

4%

14%

83%

On a tablet through an application

On a tablet through a website

On a computer


Agenda: 5 Questions›How big is m-commerce now? ›What are shoppers doing on different devices? ›How much of a problem is mobile conversion? ›What is important to know about retail apps? ›How much are companies investing?


Mobile is the top priority for web retailers


Ensuring different types of connectivity in stores could be useful

Base: mobile consumers who research or buy in physical stores

How do you usually access the internet on your various devices?

Source: A commissioned study conducted by Forrester Consulting on behalf of VISA, September 2013

80%

71%

32%

1%

0%

3G/4G connection

On a password protected WiFi connection

On an open WiFi connection

Using dial up

Don't know

Most common

store options


Companies just aren’t spending that much on mobile yet

Source: Forrester Research eBusiness Survey


Takeaways and summary›Mobile phones are used more than tablets but phone sessions are arguably far less

valuable; device switching is also a given

›Offline shopping is a significant outcome of phone browsing

›Non-buyers on mobile don’t buy because of screen size and/or privacy concerns; more will become buyers over time

›Every venue is now a place where shoppers use phones and tablets

›Tablets drive most of the m-commerce revenue

›Apps convert well but need to master “mobile moments”

›Time online has changed significantly; even phones are now cannibalizing the PC

›Entire mobile budgets remain modest for most eBusinesses; mobile uncertainty remains a concern

Thank youSucharita Mulpuru

[email protected] !

!

!

forrester.com

mailto:[email protected]

state of mobile commerce 2014 (sucharita mulpuru)

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