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Mobile Commerce: Has Its Time Finally Arrived?

by Jeff Roster  |  September 24, 2009  |  6 Comments

Yes it’s been awhile since my last blog.  I have spent to much of my blog time exploring Twitter and other social media, but that’s another post.  In the retail world 2009 has turned out to be the year of cost containment and a borderline bunker mentality. The one glorious exception has been retailer’s embrace of social media and increasingly mobile commerce.  A recent blog “Starbucks reveals iPhone apps, heralds mobile e-commerce caught my attention.  I’ve been doing this job over 10 years now and have listened to m commerce pitches for most of that time.  Virtually all were very interesting but with little to no adoption by retailers.  But I believe that has clearly changed.  On my iPhone I can access apps by Amazon, Best Buy, Sears, eBay and the above described Starbucks app.  My guess is within 6 months there will be many, many more. 

But the key question is, “Will people use these apps to conduct real business. ”  I believe that question was answered very dramatically by eBay CEO and Presedent John Donahoe at shop.org recently:

  • eBay Mobile app for iPhone launched last year and to date, it’s been downloaded by 4 million users, regularly appearing in the top 3 free apps in the lifestyle category.
  • All kinds of things sold through eBay mobile app … the most expensive include:
    o A rare Lamborghini for $750k
    o A $300k power boat
  • Mobile is our fastest-growing business. Our GMV so far this year through the eBay mobile app alone is about $350 million … and growing double digits week on week.

Those are simply amazing stats and illustrate the broad appeal of m commerce today.  So to answer the question posed in the title, I do believe m commerce’s time has arrived.  Retailers need to prepare for this onslaught.  Are you ready?

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Category: mobile-commerce  retail-industry-events  retail-observations  retail-retail-it-marketing  

Jeffrey Roster
Research VP
12 years at Gartner
15 years IT industry

Jeffrey Roster is a research vice president at Gartner as part of the Industry Market Strategies Worldwide unit covering the retail and wholesale industries. In this capacity, Mr. Roster consults on market strategies, competitive assessment of the IT services landscape, technology trends and the direction of IT spending to provide market research for IT vendors. Read Full Bio


Thoughts on Mobile Commerce: Has Its Time Finally Arrived?


  1. Gary Sankary says:

    Mr Roster, once again your strategic insight and cutting edge proficiency with new technologies lead the way to the future. I would challenge however, that it’s still a bit further in the future than you would indicate in your post. There is no doubt what so ever that mobile platforms are the future of the consumers’ multi-channel experience. However I would argue that we’re not quite there yet, and that the crystal ball of what this space looks like even 2 years from now, is still cloudy.
    The iphone has been a game changer in this space. The ability for consumers to download applications and interact with retailers is starting to have an impact in retails marketing strategies. The customer using an Iphone to order products or research items, especially on applications wholly owned by the retailer, are among the most valuable customers in the store. Clearly those are people who have enough of a connection with that brand and that store that they would take the time to download an application in order to extend that experience, and they’re probably younger consumers who have a very high potential for future sales. Us old guys are still scanning the papers for our deals, and don’t really open our wallets anyway so who cares?
    That being said, I would temper with the this. With the exception of iphone, the actual mobile platform, devices etc. which consumers are currently using to access a retailers content or product data lag behind the vision of what this platform could be. In addition, with the proliferation of devices and apps there will be increasing concern, I believe, with the data a given customer has access to, while in the 4 walls of your store. This concern is only going to get worse as more consumers have the ability too, and actually do start comparative shopping your competition, both online and brick and mortar while in your store.
    Additionally these apps (although good news, not the devices) still have low penetration in the key demographic most high frequency categories cater too, the 30-50 year old working mom, who still values ease of shopping and has yet to value technology and mobile apps. This will make more sense for big ticket items or items aimed to early adaptors and technically savvy lifestyles.
    I would also add that there is going to be an increasingly competitive market for your customer’s attention (and accompanying wallet share) by these apps in the very near future as retail and suppliers start creating similar apps for the same products. I could see where a customer downloads their favorite stores “product selector”… and downloads a similar app, maybe with more incentives, coupons, online ordering or what have you, from that same stores biggest vendor. Where does the consumer go? The store offers you information on all their products while the vendor offers you free shipping and a competitive price in an effort to combat your store brand.
    I think it’s going to be a bit of the wild wild west in this space for a while yet. My opinion is any company with a consumer as their end user needs to spend the money to understand mobile, and to make the investment in creating the “killer” app that will add value to the consumer, real measureable value which will make their app the “app of choice” for consumers in a given merchandise segment or class of trade.
    We’re close, no doubt, but all the pieces haven’t fallen in place yet. At least that’s how it looks from my seat. Great topic Mr Roster, this is going to a quickly evolving and fascinating space to watch.

  2. Jeff Roster says:

    As always great points. I agree that it’s the wild west out there in regards to mobile commerce. I think it’s the same case with social media. I didn’t mean to imply mass adoption yet. At Gartner we’d say that’s around 30% of adoption. We are certainly no where near that level, But I can buy a a lawn tractor with my iPhone and my Sears To Go app and someone has bought a Lamborghini with a mobile device. That, to me, is beyond a pilot stage. My concern is not with the early adoptors- they get it. It rests with the many executives that aren’t even thinking about this yet. I typically see at a minimum a 2 year cycle to bring anything from first vision to deploymnet. So I really do think it’s time for just about any retailer I can think of to ask the question “What does M commerce mean to our business?” The answer could very well be nothing. Time well tell.

  3. […] This post was mentioned on Twitter by Jeff Ketner. Jeff Ketner said: RT @JeffPR: My 1st of what will become many blogs/research on mobile commerce http://bit.ly/hPw3n Love to get thoughts. […]

  4. […] This post was mentioned on Twitter by Tatyana Kanzaveli and Sascha Neth. Sascha Neth said: Interesting stats from eBay. RT @Gartner_inc: Mobile Commerce: Has Its Time Finally Arrived? Jeff Roster on his blog: http://bit.ly/CSA0v […]

  5. Encouraging stats. Another angle, just as interesting, is: are retailers embracing mobility for their own operations? We believe they should and have built an operational compliance product around mobility. But it is clear to me there is much room for expansion. Mobility is not just a \nice to have\, it is a powerful enabler in the field. By and large the vast majority of software applications available to the retail industry don’t sufficiently capitalize on mobility.

  6. Jim Crawford says:

    Another great insight, Jeff… and I agree with you that we’re well beyond pilot and yet not quite at mass adoption.

    One of the “game changers” we’ve been seeing is a convergence between (quasi) established paradigms: mobile marketing and mobile commerce… into a new idea of “mobile retailing” or “mobile shopping.” The key distinction is that instead of simply delivering a mobile Web experience (e.g. buying on eBay or Amazon from the Web browser on your phone instead of your computer), this new wave of applications and ideas brings something net new into the _shopping_ process. For example, Amazon’s app for the iPhone allows a shopper to snap a photo of a product in a store and add it to an “Amazon Remembers” page accessible through their phone, and then either purchase the product with one-click “Buy Now” or save it for a later revisit. This means that shoppers in (for example) a Best Buy store are literally shopping Amazon while in a competing brick-and-mortar retailer’s store. Another example is Yelp’s augmented reality function on the new iPhone 3GS… simply by holding up the camera pointing at the street, a shopper can see directional pointers to Yelp-reviewed businesses overlaid directly onto their view of the street. These are gamechangers because they are something NEW, not just a new way to access something existing.

    The truth is that these apps are live and in deployment today. Retailers ARE putting out live mobile apps, and not just the “mobilized web site” versions of last year. Ubiquitous mobility is FAR more common in other countries than the US, so in this, we truly are lagging behind the curve.

    I just presented this week at the International Retail Design Conference on “Store Design 2.0: Tech Ideas for the Next Phase of Retail” and out of all the technologies I covered in the speech, the one that generated the most interest and followup by retailers was “next generation” mobile retailing: applications that combine the camera and connectivity of today’s phones to create a dramatically improved experience for shoppers in the store. I was honestly pleased and surprised at how quickly store experience designers saw the power of a customer armed with a 3G cell phone.

    Mobile retailing is clearly in its emerging state, and much like e-commerce wasn’t an easy to define beast in the late 90s, there are a lot of outstanding issues on where to approach mobile retailing from: is it a portable version of your Web site? a customer service tool in your store? a marketing vehicle for shoppers strolling through the mall?

    At the Global Retail Executive Council, we’ve partnered with the CTIA Wireless Entertainment and IT conference this October to begin exploring this convergence of mobility and retailing, and hopefully the combination will yield some interesting results. If you’d like to either join the dialogue or attend the event, please visit us at http://www.mobileretailexperience.com



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