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3 Trends Shrinking the Mobile Conversion Gap

7 minute read
Deb Miller avatar

I couldn’t find my mobile phone last Saturday. 

Life seemed suddenly bleak. There were no Facebook updates, no breaking news, no storm or traffic alerts. 

I felt the isolation of a world without IM, LinkedIn and Twitter at my fingertips. Most importantly, how would I shop without my smartphone and those incredible flash sale deals from Amazon?

Digital Enthusiast or Mobile Shop-aholic?

What do you do when you can’t find your smartphone? 

Well, you could take a digital time out. Grab a paperback book, go outside under a shady tree and get lost for the afternoon in an old fashion page-turner. 

Maybe that's what I should have done when I misplaced my iPhone. Instead, I immediately called my mobile number from my home phone and tracked down my device. Then I checked IM and all my social sites, pulled my email and shopped Amazon specials for the next two hours.

Research shows that I am not alone.

Digital enthusiasts are increasingly buying via mobile. While online purchases are still dwarfed by in-store sales, mobile business is the fastest growing form of commerce. One global PayPal-sponsored study found mobile commerce is growing 42 percent annually, with 33 percent buying via smartphone. 

And on Cyber Monday last November, mobile accounted for 22 percent of online sales, an increase of more than 27 percent compared to the prior year, according to IBM Digital Analytics.

Yet shopping mobile is still more popular than buying mobile.

MarketLive data shows smartphones are more commonly used for browsing and research than for actually completing a purchase. Razorfish vice president Jason Goldberg calls this gap between mobile “window shopping” and buying the “mobile conversion gap.” 

This gap exists today but is rapidly closing — and these three trends are having the greatest impact.

3 Important Trends

Keep it Simple, Stupid

Mobile provides freedom of movement and an ability to take immediate action. This makes the mobile phone an ideal purchasing tool, especially for flash sale and impulse buyers. 

But for mobile shoppers to become mobile buyers en masse, retailers need to perfect the mobile purchase experience and reduce friction with simpler checkout.

The needs of a mobile shopper are straightforward. McKinsey research on mobile habits found “consumers want clean, mobile-optimized sites with easy-to-read pages that load quickly, easy-to-use shopping carts, and smooth checkouts.”

There is already a move to ensure these mobile criteria can be met, with performance improvements being made across the entire “shop to purchase” process flow. The changes prioritize how you find and buy merchandise from your mobile.

In part these mobile improvements come from lessons learned the hard way.

The rapid adoption of mobile has given companies complexity problems that were exposed in the stress of Black Friday/Cyber Monday. 

Last year for example the Best Buy website experienced a number of hard outages. The company attributed its crash to "record levels" of traffic, including a "concentrated spike in mobile traffic." 

Retailers are realizing they need to go back to basics to ensure performance levels. They're taking second and third looks at their sites to simplify and optimize core capabilities. 

Manav Mital, CEO and co-founder of Instart Logic technology makes the point that "retailers have realized that whiz-bang features like virtual dressing rooms don't make any difference if shoppers abandon their site because they are frustrated with site performance."

Abandoned shopping carts are a major focus area for improvement.

According to the Baymard Institute, on average two out of every three fully stocked shopping carts are abandoned by customers. Retailers are improving that stat by changing the customer experience literally at the point of conversion.

Improvements include removing registration requirements for purchase, offering one-click ordering, and implementing exclusive discounts for mobile visitors that incent them to commit to purchase.

Let’s Go Social Shopping

The rise of social shopping is helping to shrink the mobile conversion gap. Social marketing focuses on making shopping seem fun, and sharing and buying seem natural.

According to online consumer advocate Kara Kameneche’s article on best social shopping sites, social shopping aims to recreate the best parts of in-store shopping. At a social shopping site, you browse product feeds that are curated specifically for you, and the process of collective shopping helps to reaffirm and guide your purchase decisions.

Kara notes that social shopping initially just meant a brand had a Facebook page and Twitter handle, and sharing buttons on their retail website. Now there are a growing number of sites like Pinterest. With its rich pins Pinterest have created a social shopping site that allows you to make pin boards of your favorite pins, follow your favorites, and click off-site from product pin pages to buy.

Learning Opportunities

As the mobile shopping experience becomes increasingly integrated with our mobile social experiences, our “favorite places” are also becoming our shopping places. For many it fills a fundamental desire for social interaction and more importantly decision reassurance, all delivered via mobile. 

This gives mobile-savvy retailers a new platform for contextual marketing that can move merchandise by connecting with a customer's immediate interests, drive off of external events (like an impending snow storm) as well as tap into peer buying behaviors.

Taking Care of Business

Advances in secure payment may be the single biggest factor that will help to not only close the mobile conversion gap but also drive mobile commerce transactions of all kinds. In fact, consumers are beginning to buy via their mobile even when they are not cyber shopping.

Mobile has spawned new consumer payment approaches like Square that enable all sorts of retailers to process payments on the go. I have used Square with a diverse number of small merchants from my airport limo driver to my kitchen tile installer.

Shell recently taped PayPal to enable mobile payments for their Fill Up and Go service across gas stations in Britain. Customers will download the Shell Motorist application and scan a QR code to pay at the pump with their Smartphones.

Mobile wallets have become one of the most trusted and preferred ways to pay online in emerging markets. Alipay accounts for nearly 50 percent of transactions in the world’s largest e-commerce market, China. 

Last year, Alipay announced its mobile payment volume was greater than PayPal and Square, combined. 

Paytm is an e-wallet in India with 80 percent of its new users on mobile. Its exclusive tie with Uber — a business model that would never have existed without mobile — has been rapidly driving growth.

Who Moved My Mobile?

A shrinking mobile conversion gap is inevitable. 

I switched to mobile shopping (and buying) because it is fast and easy. 

As a self-confessed introvert, I prefer the online world over the physical world for most interactions anyway. And with the mobile improvements retailers are making I have found that my mobile purchase experience — whether via mobile apps or mobile websites — is increasingly superior to both its in-store and non-mobile digital counterparts.

While change is not always easy, it may be prudent to keep in mind the author’s advice from the iconic business fable, Who Moved My Cheese? An Amazing Way to Deal with Change in Your Work and in Your Life: “The quicker you let go of old cheese, the sooner you find new cheese.”

Certainly there are already a whole set of new retail behaviors because of mobile. 

And mobile has demonstrably impacted entire industry business models, mostly for the better, introducing new and improved ways of accomplishing tasks. Some companies may fear the disruption and be slow to let go of the “old cheese,” others are rushing to change, embracing mobile as a competitive advantage.

At the same time a growing group of consumer digital enthusiasts are embracing all things mobile, including mobile commerce. Taken to the extreme, mobile may even have the power to eventually turn us all into irrational nomophobics, inseparable from our smartphones for even a moment.

As for me, the next time I misplace my mobile I am going to read a book.

I have a really good one for my iPad Nook app that I purchased on my mobile in a flash sale last Saturday.

Creative Commons Creative Commons Attribution-No Derivative Works 2.0 Generic License Title image by philthegreat.

About the author

Deb Miller

Deb Miller has led marketing initiatives at global companies like GE, Software AG, Global 360, OpenText, and Appian. Her work focuses on industry strategies for enterprise information management and business process improvement.

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