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U.S. Retailers Tip-Toe Through Mobile Commerce Minefields

August 13th, 2009

Westenberg’s partner in the study, Joanne Bethlahmy, director of the Cisco Consumer and Retail Internet Business Solutions group, said she expected to find more mobile sites offering transaction capability. “Certainly, it’s a bit of a surprise that it’s taking as long as it is to develop mobile commerce,” she said.

Some observers, including Michael Dulong, SVP of business development at mobile payment platform provider Billing Revolution, argue that retailers were caught off-guard by the sudden advance of M-Commerce-ready mobile units that, unlike predecessor devices, actually had the ability to deliver decent mobile purchasing experiences. “My view is that the major retailers have been caught behind the eight ball when it comes to mobile commerce for a number of reasons,” Dulong said. “I think the first major driving factor is that smartphones have jump-started the evolution of mobile commerce and caught the industry by surprise. Nobody in the mobile industry was ready for this, much less the E-Commerce industry.”

Many retailers held off on launching mobile sites due to the fact that mobile shopping was a horrific experience on regular tiny-screened cellphones and because they were uncertain people would want to buy things on them even if that wasn’t the case. Given the popularity of larger-screened smartphones and Emmons’ assertions that the Sears2Go and K-Mart mobile sites are doing well, that excuse is losing its viability.

Nevertheless, even retailers supposedly aware of the better capabilities of new devices might have dropped the ball. “I know Best Buy and others have only very basic mobile sites that allow users to enter a ZIP code to find the nearest store and/or click to call the nearest store,” Dulong said.

The fact that M-Commerce takes place over networks owned by a handful of carriers might also give pause to retailers already squeamish about deploying mobile sites. Although the carriers will reap the benefits of M-Commerce’s growth, they can impose restrictions on certain types of data, noted Impact Mobile CEO Gary Schwartz. For example, he said Verizon has issues with text message content. “If I have a text message and I want it to say, `Hey, we have jeans on sale, here’s a link. Go to our M-Commerce storefront and buy them,’ I can’t do that on Verizon,” Schwartz said. “They will scrape it out. They don’t want you to do anything they can’t control on their Internet portal.”Netbiscuits’ Farmer agreed there are differences in the types of data the various carriers support. “Some carriers don’t allow you to deliver video,” he said. “Some require an image to be delivered in a certain format.”

Cisco’s Westenberg, who often speaks to retailers about their mobile commerce plans, said “the majority realize the number of phones out there providing an experience they consider to be good enough, which is to say roughly the same as online, is growing dramatically,” he said. “The actual penetration is still only 14 or 15 percent, but they recognize this is very important.” However, he pointed out there are retailers “that are sort of followers,” Companies that “kind of know this is going on, but will dismiss it as not so important.” Nevertheless, he’s observed a change “from an almost unwillingness to even discuss this several years ago to where they now really want to know what to do. But nobody’s been able to provide them with a recipe for success.”


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One Comment | Read U.S. Retailers Tip-Toe Through Mobile Commerce Minefields

  1. Todd Leiser Says:

    Very well written piece. Thank you. The Amazon experience is amazing and gives them yet another leg up on brick & mortar. By the time traditional retailers figure this out I (and others?) will have already emotionally, habitually, and financially committed themselves to Amazon’s experience for many products, and to your point, leave them where they were in the dialup-to-broadband transition years.

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