Introduction to M-Commerce: Benefits of M-Commerce

This short Introduction to M-Commerce will teach you how to leverage your e-commerce business with a mobile commerce approach and move your business to mobile commerce.

You’ve probably already heard that mobile commerce is paving the way customers shop these days. But have you ever considered a move to m-commerce and the possibility of making a lot more money for your business?

Now is the perfect time to stop and consider your next move.


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Over the last few years everyone has been talking about mobile applications and how mobile commerce has become the #1 channel you should think of when marketing your products and services.

But what if thinking about it is not enough? What if you should actually move your business to mobile?


What Is Mobile Commerce?

To fully understand the potential of mobile commerce, we should explain what comes into this term.

As you can see below, it is not simply just buying and selling stuff with mobile devices.

Depending on the approach we can include:

  • purchases on mobile web and apps;
  • mobile payments;
  • mobile money transfers and m-banking;
  • and mobile financial services.

Because of such differentiation we can see different data and mobile commerce market value. Speaking only about mobile purchases (on the web or in the app) we should use the term “retail m-commerce.”

This way we can easily compare the m-commerce market share with e-commerce and total retail and analyze the relevant data.

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Why M-Commerce Matters

The growth of mobile commerce is significant. In the United States alone, mobile e-commerce spending rose from $0.6 billion in Q2 2010 to $11.1 billion in Q2 2015.

The Goldman forecast predicts that in 2018 m-commerce will reach the value of e-commerce from 2013, which was $626 billion.

Amongst the users sometimes referred to as digital spenders, cross-device shopping became a part of their regular buying experience.

According to Criteo’s report for Q3 2015 47% of users used tablets, 43% used smartphones, and 39% used laptops in their path to purchase.

what is m-commerce - share of transactions


source: Criteo

If it comes down to the question of whether you should use a mobile optimized website or a dedicated app, the Criteo report shows the rising opportunities of app purchases.

Retailers who created a dedicated app for their business saw a HUGE response, with 58% of all mobile revenue coming from the app. And, these numbers are going to grow.

The mobile experience is also very important while looking for local business information. Kissmetrics shows that 78% of mobile phone users convert when searching for such information. This was compared to a 61% conversion rate from PC/laptop users, and 64% on tablets.

Moreover, in the previous year, the following events helped shape what is now the increasing market of mobile commerce:

  • Google penalty for non-mobile-friendly sites – this means that if you haven’t thought about making your site mobile friendly yet, you should. Google understands that for now mobile is overtaking desktop searches and tries to put mobile users first.
  • On-demand services – since 2014 we have been talking about the “Uberification” of the economy. Started by Uber itself, it’s a breakthrough for customers wanting to be given an opportunity to access the offers they want; anytime and anyplace – thanks to the mobile devices they own.
  • POS retail on mobile – brick and mortar companies try to fill the gap between online customers and those who search for products and discounts while in-store. This leads to scannable products and discount coupons that help meet those needs.
  • Mobile commerce revolution in India – can you imagine shutting down a whole site and moving to mobile app selling only? This is what happened with Myntra – fashion e-commerce in India. Its parent company Flipkart’s CEO Sachin Bansal said that if the experiment goes well, Flipkart’s site will be shut down too. This means that India’s largest e-commerce company will go mobile only.

If I haven’t convinced you yet, let this be the final argument: selling offline goods via a mobile app gives you more money than all other app monetization methods combined!

what is m-commerce - revenue model


source: TechRepublic

As you can see, there is a lot of money to be made in mobile commerce. The question is: can you earn some of it for your business?


How to Boost Revenue with M-Commerce

So you ask: How can I do a business with mobile commerce app?

Take a look at these examples of successful m-commerce companies and see for yourself.


1. Myntra – India’s e-commerce revolution

Sure, it was a bold move – to completely shut down a desktop site and go mobile-app-only.

But the reason that Myntra – the biggest fashion e-commerce company in India and a unit of India’s e-commerce company, Flipkart – went mobile seems pretty obvious when you look into the data.

The traffic from the mobile app for Myntra was actually 90%! This number is HUGE and explains why such a decision was even considered.

And as Prasad Kompalli, head of Myntra’s e-commerce platform, said to Reuters, the engagement for fashion shoppers is even bigger on the mobile app.

Can you have similar results? Well, it depends on your niche.

First, check on how much of traffic you get from mobile devices, and second – decide if your business is suitable for the mobile-only channel.

For example, travel companies saw a little bit less engagement from mobile than from retailers.


2. Etsy – the shopping place for creative buyers

If you are looking for an example of successful mobile commerce to sell goods globally, Etsy is definitely a good one.

Its revenue grew from $26 million in Q1 2013 to $65.6 million in Q3 2015 and last year more than half of their visits (53%) came from mobile.

The idea of the app is simple – to offer a marketplace for handmade, creative, or vintage goods.

To improve the shopping experience, Etsy built Community Tastemakers where you can get inspired, and it offers gift cards which you can use yourself or give to a friend.

introduction to m-commerce - etsy site


The example of Etsy shows that you can build a successful mobile commerce business in any niche, as long as you provide a positive shopping experience and create added value, e.g. by creating a community around it.

You can do this by helping people who love the products you offer get useful information or inspiration from you, and then make it easy for them to buy the things they want with their mobile phones.


3. Starbucks – the bridge between m-commerce and POS retail

With the Starbucks mobile app you can now order coffee, pay for it with your mobile device, and then go pick it up without waiting in line.

What’s more, Starbucks also futher engages its customers with loyalty rewards.

This approach is so successful that in 2014 it brought the company 16% of earnings from mobile, which was the equivalent of 7 MILLION transactions per week! Just from mobile!

Starbucks’ app is so engaging that it allows its users the ability to give a tip, give a friend a gift, receive notifications about discounts, or find a Starbucks nearby.

The success of the app is quite simple – it allows you to get your coffee quick, with just a tap on the screen of your smartphone, while also enabling you to get bonuses and engage with the brand and with friends.

This is a great way to boost visits in the POS and bank on the user’s desire to order and pay with a mobile device.

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The Next Big Thing

Mobile commerce is a natural way to think about the businesses of the future.

Customers already want to engage more and more with their mobile devices and the number of transactions – not only traffic – will grow with mobile apps.

If you already have an e-commerce site and see a vast amount of traffic coming from mobile – don’t hesitate! Monetize those searchers with mobile commerce.


P.S. In a few years, Mobile commerce will be as big as e-commerce is now. You definitely want to be a part of this trend and benefit from it. There are already many successful companies that adjusted to the trend from the very beginning and it has paid off very well for them.

Or, you can just keep doing what you’re doing with e-commerce and watch the traffic move away to your competitors who are using mobile commerce apps.