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8.12.16 Mobile

Is Mobile-Only Shopping the Future for Retail?

By: Levi Horowitz

In 2015, 68% of American adults owned a smartphone and other 45% owned a tablet, which put mobile shopping right at the fingertips of many consumers. Shoppers use their smartphones to research products and even complete purchases, sometimes even while in another retail store. More and more, the customer’s shopping experience is not just happening at one time in one store, but instead, it can occur anywhere there’s wifi.

One-Third of Online Purchases Come From Mobile Devices

Criteo, an online marketing company, put together a report to take a closer look at mobile shopping in 2015. “State of Mobile Commerce: Growing Like a Weed” analyzed billions of sales worldwide and broke the information down to basic trends. Simply put, mobility is more in style than ever before.

Overall, Criteo found that 34% of global e-commerce is now mobile. In 2015, Japan and South Korea saw history in the making, with mobile device use increasing to make up a majority of online sales (just over 50%). On the other side of the world, at 29%, the U.S. trails slightly behind the global trend toward mobile device shopping. Taken altogether, the pattern is clear: E-commerce is shifting toward m-commerce, with mobile phones making up a larger part of online purchases across the globe.

A photo of stack of clothing

34% of global e-commerce is purely mobile-based, according to Criteo’s study.

Domestically, Facebook IQ’s research shows that more consumers in U.S. are switching from desktops to mobile devices for online shopping. The report shows an increase of 35% in the frequency of mobile purchases in 2015.

Mobile shopping is a growing trend, with more growth expected from the up-and-coming generation in the years to come. Already, for Millennials, 57% of all shopping involves using mobile technology in some way. 

55% of Shoppers Use a Mobile Device Because It’s More Convenient

For tech-savvy individuals, e-commerce from a mobile device is just easier. Phones are always on hand for fast browsing and buying — meaning shoppers don’t have to stand in line. Additionally, shipping options have become more convenient for shoppers as retailers like Sephora and Amazon offer a flat annual fee for year-round expedited shipping.

For customers to quickly find what they want, mobile devices serve as an invaluable browsing and comparison tool in the palm of their hand. Because of its convenience, mobile shopping is gaining wider popularity. In Facebook’s survey, 55% of omnichannel shoppers made a purchase using a mobile device because they can do it “anywhere, anytime.”

Increased mobile shopping brings convenience to the shopper and profits to the retailer. On Cyber Monday in 2015, Americans spent $3 billion online, and 30% of those sales were made on a mobile device.

There’s been an undeniable shift in how people make purchases. In a day and age where you can order a pizza via emoji, it shouldn’t surprise anyone that more people are using their phones to buy whatever they need.

54% of Mobile Purchases in the U.S. are Made from a Smartphone

Smartphone devices dominate e-commerce, according to Criteo. In 2015, smartphones overtook tablets as the tool of choice for 54% of mobile shoppers in the U.S . Meanwhile, in Japan, smartphone purchases make up a whopping 90% of all e-commerce.

A photo of a smartphone

In 2015, smartphones became the tool of choice for most mobile shoppers.

Mobility is in high demand for shoppers on the go. Criteo’s data revealed that being mobile-friendly makes a positive difference in sales. Businesses that facilitate shopping from a mobile device (especially smartphones) see an uptick in mobile revenue. The addition of a mobile app, for example, increases the number of online purchases coming in.

Instead of removing shoppers from brick-and-mortar stores, smartphones actually bolster retail sales and support consumers in-store. According to the Federal Reserve’s report “Consumers and Mobile Financial Services 2015,” 47% of smartphone owners have used their phone for the purpose of research while at a retail store. Facebook IQ claims that about half of Millennials conduct research on a mobile device before making a purchase online or off.

Over the course of 2015, the number of online shoppers using a mobile device increased slowly but surely, with Facebook IQ projecting even greater usage to follow. A majority of 60% of respondents said they expected to continue shopping on their smartphones as much or more in 2016.

Even Though It’s Expanding, Mobile Shopping Can’t Do It All

When shopping online, mobile technology has strengths and weaknesses. Criteo found that mobile shopping is most prevalent in the areas of fashion, luxury, and travel. Where mobile sales lag is in the buying of larger, household goods. This suggests a consumer population hungry for a quick click on impulse purchases, but more cautious to commit to larger transactions on mobile devices, perhaps because users want to test drive certain products before buying.

Just as book lovers cling to their paperbacks over e-readers, many shoppers still want to shop at an actual brick-and-mortar, walk-in-and-buy store, especially when it comes to furniture and appliances. While online shopping is increasingly popular and mobile, e-commerce isn’t going to supplant retail stores soon. 

TimeTrade’s “State of Retail 2015 Report” found that, among American consumers, 85% would prefer to shop at a physical store instead of online. It’s not just the older generation, either — 92% of responding Millennials stated they will continue to shop in-store as much as or more than they did in the previous year. So, even as mobile shopping increases, in-store business should remain steady. With generous return policies that allow online products to be brought back to a physical store to save on shipping fees, consumers readily trek back to retail locations and provide another chance to sell to them.

Mobile Device Shopping Grows to Support Store Locations

The role of the mobile device is to complement traditional shopping. Its rise has not displaced stores or rid the customer of a desire to see and hold a product before purchase. While recent studies show growth and promise, the general U.S. populace still hasn’t fully embraced m-commerce as the end-all and be-all purchasing channel.

One solution we may see more of is for retailers to offer in-store incentives and integrate the retail storefront shopping experience with mobile browsing. Brands like Victoria’s Secret already incentivize consumers to visit physical locations with in-store deals and invitation-only shopping events redeemable through the company’s mobile app.

While convenience drives much of the current growth in toward mobile shopping, retail stores will be keeping their doors open for a long time to come if they work with the trend rather than against it.