Dial 'S' for Smartphone Surge

At this point in the academic term, no doubt hundreds of professors are sick and tired of seeing students pull out their smartphones during class lectures. Profs may be fighting a losing battle.

NPD DisplaySearch, a market research firm, predicts some 567 million smartphones will be shipped this year, and that number will nearly double by 2016. Of this year’s shipments, close to 177 million will be to first-time smartphone owners, many of them teens and college students. As the baby boomlet (kids born to the famed Baby Boom generation) begins to peter out in the college enrollment ranks over the next few years, NPD sees the number of new smartphone buyers dwindling somewhat.

On the other hand, the number of people replacing existing smartphones with new, jazzy models will skyrocket. Because many people tend to buy new phones whenever their current two-year mobile contract is up, it’s expected phone manufacturers will work with carriers to offer shorter contract periods to encourage more frequent upgrades.

Faculty might as well get used to the fact that students will bring—and use—these devices in the classroom. But they’re not the only ones who need to get up to speed.

The Wall Street Journal’s Tech Europe blog reports that a study by London-based investment banking firm GP Bullhound shows many companies, particularly retailers, haven’t built mobile apps and optimization into their e-commerce offerings yet. As a consequence, they may be missing out on sales. Purchases from mobile devices, according to the report, accounted for 11% of all 2011’s holiday season sales, almost twice as much as the year before.

Mobile Payments Will Continue its Momentum in 2012

That is what one article predicts as more NFC enabled phones enter the market and companies sharpen their business models.   The article summarizes significant mobile commerce events of 2011 and provides a snapshot of what the market players are doing in this space.  Here are some of the highlights mentioned in the article:

• Starbuck Corp. reported having nearly $26 million transactions since January 2011. They also managed to gain wide acceptance for mobile payments without Near Field Communication.
• Square Inc. announced 1 million users of its mobile payment system.  It processes approximately $11 million each day without NFC. 
• Google launched Google Wallet with Isis.  Isis gained pivotal partnerships with key industry players.
• AT&T, Verizon, and T-Mobile USA are supposedly investing more than $100 million into Isis.
• Isis signed Visa, Amex, and MasterCard Worldwide to its system.
• Isis plans to pilot in Salt Lake City, Utah and Austin, Texas this year.  Consumers using Utah’s transit system can pay the transit fare using the mobile payment system. 
• PayPal announced its mobile plan without NFC.
• Smaller companies are signing agreements with wireless carriers for mobile payment options.  Companies like Boku, Danal, and Zong are finding niche markets in the industry.
• Some predict if Apple launches an NFC-enabled iPhone that would create the market.   Apple owns 31 patents related to NFC technology.
• A research firms predicts NFC handsets in 2012 will be close to 80 million, a 129% increase from 2011.

 

Price Comparison on Mobile Expected to Increase for the Holidays

Mobile Commerce Daily reports on Deloitte’s new annual survey showing that 59% of smartphone owners plan on using their devices for price comparison shopping during the holiday season.  While 44% percent of consumers who own smartphones  plan on using social media connections to seek out advice, discounts, and reviews. 

Study Shows Increase In Mobile for Banking and Credit Card Services

A recent study by comScore reveals a rise in mobile usage for banking, credit card, and auto and property insurance services.

The study shows that 12.7 million mobile users used mobile banking, an increase of 45% from 2010.  For mobile credit card services there was an increase of 23% at 18.4 million mobile users.  Use of mobile for auto and property insurance services saw an increase of 19% with 7.2 million mobile users.

“The investments in mobile made by financial services institutions, along with the continued growth in smartphone adoption, have had a truly positive effect on the use of mobile financial services,” said Sarah Lenart, comScore vice president for Marketing Solutions. “New apps and mobile-enhanced sites have made it easier for customers to seek out financial information using mobile devices. With tablets and other web-enabled connected devices gaining popularity in addition to smartphones, financial service institutions are poised for additional growth in mobile access.”

This is an important trend to keep an eye on since mobile will be an expected service in many industries especially for college bound students who as we know use mobile all the time.

Virtual Stores and QR Codes

This is a great video of how one retailer is taking itself to the consumer using QR codes.   The video shows people shopping while waiting for the subway in South Korea where the virtual displays and the merchandise is identical to what a customer would see in the store.  By using smartphones a shopper can scan the products QR codes and place it in the basket and the grocery bags are delivered to their home.  Essentially, for busy South Koreans, they can shop while they wait.   This is the wave of the future for virtual stores and QR codes and for retailers who are contemplating whether to open another brick and mortar they should consider following the trend being set by the most connected people in the world.

Google Wallet's impact on retail

Mobile Commerce Daily reports that it does not believe Google Wallet app will have much impact on short term retail sales but there are long-term benefits such as loyalty conversion rates and increased qualified sales. 

“The enrollment rate for loyalty programs could reach up to 70 percent thanks to NFC-enabled mobile wallets such as Google Wallet.  If you are paying with your phone, you already have the phone out so the barrier to converting someone is radically lower.” per Matt Wise, CEO of ePrize. 

“We see the launch of Google Wallet as a significant step forward in the hugely expanding North American and global mcommerce marketplace,” says Gary Schwartz, MEF North America chair and CEO of Impact Mobile, Toronto, Canada. “Google’s product brings awareness to the viability of mobile payments across a wide audience of consumers and merchants.”

Mobile commerce is expected to grow significantly in North America this year, having lagged behind many other countries.  Students are often early adopters of new technologies, so stores should expect that shopping-saavy students will soon be looking at more mobile payments.

Tips for Developing a Mobile Game Plan

Book Business's feature article this month is on “21 Tips for Developing Your Mobile Game Plan.” Book Business asked several industry executives who have navigated the mobile waters to share their insights on how to develop a successful mobile strategy. While geared toward publishers, there are a number of items on the list relevant to booksellers too.  Here is the list, with details available in the article.

1. Focus initially on iOS and Android platform and get revenue flowing.
2. Determine the level of interactivity for your app. Avoid “feature creep.”
3. Develop enough apps and to learn what your ROI is for the specific app.

4. Get one product to be successful even on a small scale. Learn from it and then follow up with updates and feature enhancements as appropriate
5. Get a few apps on the market that are well-targeted and bug-free create your core base of loyal buyers. Marketing will be key. Develop relationship with Apple and Google.
6. Make sure to nurture good relationship with the big e-book vendors.

7. Publishing e-books is more work. More formats = more work.
8. You will need to transform your traditional workflow to manage digital content.
9. Digital publishing is still manually intensive.

10. Develop for more than just the desktop.
11. There is no best way, only good ways. Remember there are a lot of ways consumers access content.
12. Rethink what your product is.

13. Be bold with Mobile App as we were with Web 10 years ago.
14. More than one way to go mobile- mobile app or mobile web.
15. Accept Apps will cannibalize your other platform but you will keep customers

16. Learn how to work with Apple
17. Build as installed base of users of free apps and then make use of in-app purchasing to sell paid apps to that installed base.
18. Take the plunge.

19. Mobile Search strategy is different from Web search .
20. Mobile strategy should be focus on “action-oriented activities.”
21. A mobile search has to yield a result with eBooks that are interesting to read, priced competitively, and available to buy [immediately] on mobile or in-store.

Pay for eBooks via Phone Bill

Readers around the world will have option to easily pay for eBooks thought their phone bill. Bango, mobile analytics and payment company,announed that it provides Mobcast, the digital book software platform, with operator billing for its mobile digital bookshop GoSpoken.com. Bango allows customers to place a charge on their phone bill for purchases made directly from the mobile version of GoSpoken’s digital bookstore. According to the article, this click-to-pay consumer experience is seamless and secure, maximizing conversion rates for purchases from connected phones and tablets across multiple platforms and networks including Wi-Fi. “By using Bango to deliver a consistent operator payment experience to all our customers we have seen a marked increase in sales. Conversion rates using operator billing are much higher than using other methods, and easier for our consumers”, said Stephen Crawford, Operations Director, Mobcast.

Forming mobile commerce strategy

Here’s an article on m-commerce strategy for those of you who are contemplating going mobile. In summary, if you intend on setting up a mobile app for your store make sure you have a clear “m-strategy” that defines what you are trying to accomplish by going mobile.  Always focus on customer needs and not what your business partner wants you to have. One of the implications of this for stores is the need to monitor your customer’s mobile experience. Stores must continually improve their capabilities to make data-driven decisions.  Plan on having a process to collect, analyze, and learn from the data you collect.  Mobile commerce is still relatively new, and there is much to learn yet.  However, the future of retail will be more heavily dependent on mobile and related technologies.  

More than 2/3 of mobile device owners participated in M-Commerce

A recent study reports that 2/3rds of mobile device owners also participate in mobile commerce.  Out of 1600 surveyed, 39 percent of smartphone owners make purchases with their handheld devices once a month. Additionally, 60 percent of mobile owners use their smartphones to help them shop every month. According to the study, more than two-thirds of active mobile consumers are 16 to 24 years old.  That is the prime customer age group for college stores.  Additionally, 31 percent of active mobile consumers are Baby Boomers and are aged 45 to 64 years old.

The study also points to the rise of social media as a factor in driving mobile purchases. According to the study “mobile shoppers were more likely to be influenced by recommendations from friends, family and customer reviews than traditional promotion channels, including store displays and store associates. Social networks allow mobile shopper to know what their peers and friends reviews want, which in turn impacts them.”

We would like to hear what different stores are doing to engage in m-commerce or social media.  Any great success stories to share?  Or failures we can learn from?  Or ideas we might try?

M-Commerce Increases foot traffic

Another article reminding us M-Commerce (Mobile Commerce) is a must for retailers. M-commerce is enabling consumers to research, price compare, and be informed and is becoming more than just an impulse buying tool. “Consumer mindsets and expectations are that they should now be able to purchase anything on a mobile device that they can on the computer or in a store.” According to the article, “for every one mobile transaction, the store locator is used 63 times, showcasing that mobile can have a significant influence on driving customers to the retailer’s store so they can touch and see the product in person before they buy."  This presents opportunities for retailers to both drive foot-traffic and capture sales.

The Facebook Mall & Retail Trends

Working through my email archives this week and I came across this message from Karen Hernandez at Normandale Community College Bookstore. She wrote:

I thought this was an interesting article about shopping and setting up a store on facebook. Might be something that stores should think about doing soon while it is still free. If you read the entire article in “All Things Digital” it appears to be something that would be attractive to students when they find out about it.

This piece relates to another story from All Things Digital that has been sitting in my archives for a while. That story was on retail technology trends in 2010 that will change the way consumers shop: mobile, social, and local. Here is an excerpt:

Mobile: There’s definitely an app for that. As smartphones go mainstream, savvy shoppers use apps to price-check and read reviews of products in the store.
Result: Retailers watch in horror as shoppers leave their stores empty-handed and drive across town to another store or go online to order a different or cheaper product.

Social: Friends and social circles influence purchase decisions through the rise of Facebook and Twitter. Users check in on apps, such as Foursquare and shopkick, for discounts and incentives.
Result: Retailers who don’t bone up on their social media skills may miss out on generating conversations across the Web that result in online sales or traffic to their stores.

Local: Advertising begins shifting to Groupon and LivingSocial, as group discounting and daily deals gain popularity.
Result: At least initially, these deals have been successful at locking in sales for local stores and restaurants looking for a bump in visitors.

The story goes on to discuss what various retailers are doing in each of these areas with ideas for driving traffic or changing business practices. The world of retail is changing--time for folks to get on board.

Square Turns iPad into Cash Register

It seems there’s a new report every day detailing what the Apple iPad can and will do for education and students. Now, the device appears to be ready to serve the college store as a new type of cash register.

According to reports, including this one from Information Week, the mobile payment startup firm Square has developed a free application that allows merchants to use an iPad to accept payments and receive sales analytics. The Square Register app works with Card Case, a consumer app available to both iPhone and Android users.

“Every single merchant that uses the Square Register has Google-style analytics for everything they do,” said Jack Dorsey, CEO of Square and cofounder of Twitter. “They can easily answer the question: ‘How many cappuccinos did I sell today?”

The potential fly in the ointment is that both merchant and consumer must have the right software installed to operate properly, according to IDC analyst Aaron McPherson, who also suggested Square should integrate its system with a PC-based point-of-sale system.

Everything Marketers Should Know About QR Codes

QR codes are all the rage in marketing these days. The two-dimensional bar codes store tons of marketing information, can be printed on nearly any kind of surface (think cake frosting and temporary tattoos), and, best of all, the tools needed to create and read them are free.

This article from SearchEngineWatch.com lists 14 tools, tactics, and best practices marketers should know about QR codes to get started. The article has plenty of basic information about QR codes, along with links to the free code generators and readers.

Along with the helpful tools and information, the author provides a QR codes checklist and worksheet to help plan a QR marketing campaign.

Bleak Findings for Web Security in Symantec Report

The notion of web security is looking more like a contradiction in terms, according to the annual threat security report issued April 5 by Symantec. The report says daily web-based attacks increased 93% from 2009 to 2010 and that social media sites, such as Facebook and Twitter, are particularly vulnerable.

Attackers use the popular social media sites to distribute malware because users trust messages they think are coming from friends. The Symantec report estimates that nearly 17% of all links posted to Facebook actually connect to malicious software. In addition, 65% of links that have used URL-shorteners were malicious—and 75% of those bad links were clicked on at least 11 times.

Mobile devices are not yet being targeted as often, but that could change soon as smartphones turn into electronic wallets with the use of near-field communications. This could prove a particularly troubling trend on college campuses as schools look for ways to make payment methods easier for students.

“The biggest issue right now is the false sentiment of security people have when using social networks or when installing smartphone apps,” says Catalin Cosoi, head of BitDefender’s Online Threat Labs, in an article for TechNewsWorld. “Since these services or devices are represented by known international institutions, they believe that they are safe.”

E-tailers Ready to Increase Tech Budgets

Online retailers are making plans to increase their technology budgets this year, according to Forrester Research’s 2011 Online Retail Technology Investment Outlook, which polled 63 U.S. e-tailers about their technology investment priorities for the year.

Integration with back-end systems for order management and accounting systems was the leading priority, up to 63.5% from 31.6% a year ago. More than half of the respondents are considering investment in mobile commerce, while another 24% plan to upgrade their e-commerce platforms in the next 18 months.

Site usability and design are another area of importance, with 70% of the e-tailers responding saying it will be an area of concern for 2011.

Publishers optimistic about year ahead

According to this month's edition of Book Business Magazine publishers expect the online retail channel for books to continue to expand this year for both print and digital. Brick-and-morter booksellers are perceived to be at something of a disadvantage as we pass the point where over half of all books are now sold online. At least one of the publishers within the educational space reported that as much as 45-56 percent of their revenue now comes from digital products (including journals and other products beyond textbooks, but even the latter has seen growth). There seems to be a consistent view forward that sales will be increasingly on mobile devices, and that digital content sales will grow rapidly, and will see the introduction of a number of new formats and variations, including more custom possibilities, over the next few years.

See the current issue for a range of other interesting stories.