Simtech Development

Is It True That Mobile Commerce Is The Future Of ECommerce?

Elena Rychkova
mobile vs desktop

Everyone’s been talking about the growing role of mobile commerce for the last years. This propaganda is pouring from all around to the businesses building their success in the digital environment. Influential statements by the major marketers and the opinion leaders make brands drive their budgets to develop mobile apps, web apps and mobile versions of their e-stores. That’s a hell of the money. Though this buzz is very persuasive, a wise thing to do will be to sort out what it’s based on. So I’ve spent several days to study the issue and share my results and my point of view as a business strategist.
 

Visiting

Undeniable, mobile usage is growing. Statista is forecasting the number of mobile phone users to reach 4.68 billion in 2019. Internet penetration is also growing – there’s no surprise here.
But at the same time, mobile users are only closing up to the number of desktop users, which make up over 50 percent of all internet users worldwide. It took mobile users quite a while to almost equal that level.
That achievement looks even less impressive taking into account that desktop and mobile users heavily overlap. So you can safely say that almost all mobile users have desktop devices, but not all desktop users have mobile devices. That makes things look differently, doesn’t it?
Let’s go deeper. Growing usage is great, but who are they, people who make this trend? According to statistics (love them), most mobile traffic in 2018 was generated by Asians – 61 percent. Guess what country is leading in that region? Correct – China. The problem is, that China is almost a closed-door for digital expansion of the global brands due to its governance model and a self-sufficient infrastructure and production capacity. In other words, you can’t beat their local merchants without a strong partnership with local businesses. Mobile apps and responsive websites are the last things you should think about targeting that region.
Is mobile-first business strategy looking so reasonable now for the European and US-oriented businesses?
 

Shopping

As of the fourth quarter of 2019 smartphones accounted for 65 percent of retail site visits worldwide but generated only 46 percent of online shopping orders.
However, mobile commerce has been on a continuous rise last years. In 2021, 72.9 percent of all retail eCommerce is expected to be generated via m-commerce. That is clearly a trend to follow considering, alongside, the projected amount of all retail eCommerce sales worldwide of 4.88 trillion U.S. dollars in 2021. To compare with, Total Transaction Value in the Digital Commerce segment in 2019 amounts to 3.4 trillion U.S. dollars.
However, here are some facts about the consumers to consider. With a total transaction value of 977 billion U.S. dollars in 2019, the highest value worldwide is reached in China. The runner up is the USA, with 874 billion U.S. dollars. That means that China makes ⅓ of all eCommerce related transactions. Sadly, we have to expel them from our perspectives. If we do some math here and recount the potential mobile transactions that we can count on, we’ll get 2.74 trillion U.S. dollars (no China, mobile only), which is around 55 percent of all eCommerce transactions value expected in 2021. But that is almost the same we can see these days.
Don’t forget about major marketplaces that take on the majority of generated digital sales. Amazon alone finished the year 2018 with GMV of 344 billion U.S. dollars.
Another aspect of mobile eCommerce is the shopping interface. According to Flurry Analytics research, 90 percent of the time we spend on our mobile devices, we spend within apps. Clearly, users prefer using apps over browsers, which makes the idea of investing in the web apps or mobile (m.site) versions of the websites adjoining nonsense. The same reflects on shopping. In Q4 2017 (the best I could find, but the point is clear), for the first time ever mobile app sales surpassed eCommerce on both desktop and mobile web with 52 billion U.S. dollars in mobile app commerce in North America, according to Business Insider and the U.S. Census Bureau.
With the above said in mind, we now are able to see the real face of mobile commerce.
Turning to desktop commerce, 55 percent of all eCommerce transactions were made from the desktop. Regardless of the fact that mobile commerce is trending and driving the sales, it doesn’t seem to make the overall difference with the desktop in terms of time. Seems like investing in mobile commerce doesn’t pay back well enough to the businesses and is too far overrated as being a primary eCommerce channel. At least, that’s what the statistics say.
 

Do you really have to go mobile or die?

The question that I had in my mind as CBDO during the research was: “Do we have to evolve into a mobile-first business and join the chase for mobile customers, or sticking to our dedicated and well-established desktop audience will be the right path?” The answer to this question was expected to change the entire business development and marketing strategy for our company. But the result for me appeared enlightening.
Having all the mentioned statistics in hands you may make another interpretation rather than me, but my opinion regarding mobile commerce value is:
 

mobile commerce is not the substitution for the desktop, this is a separate channel supplementing the entire distribution network of your company.

 
The people and technology are in an impetuous vortex, mixing processes and channels. They start their customer journey with the mobile ad and finish in your brick-and-mortar store. They can see your commercial on TV and complete the purchase in the mobile messenger. Desktop and mobile are not competing with each other, they jointly create a new rich shopping ecosystem where everyone is welcome.
 

I’m in constant communication with business strategists and if you need someone to discuss your distribution model with, I’ll be excited to be that person.

 

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