What is the real figure for m-commerce?

Mobile transactions have recently been reported as being as high as 20% of e-Commerce.

For instance Payment company Ayden recently reported that 14% of their payments are from mobile devices.

But there is mobile and mobile!

The Ayden figures indicate that transactions via tablets (mainly iPads) totalled 7.3% of transactions, with smart phones accounting for less than half of mobile transactions, only 6.4%.

Why is that important?

Because most tablet use – perhaps around 85% – is in-home or in-office. For instance TV viewing on tablets is 96% on home or office wi-fi and not mobile internet.

And therefore most purchases on a tablet are likely to be undertaken at home or at work, with the tablet device substituting for a fixed PC.

So, if only 15% of the 7.3% tablet transactions (1.1%) are truly mobile (i.e. out of home and office), then the true figure for mobile commerce is around 7.5%: impressive – but not as impressive as 20%!

The point of this is not to say “ignore mobile commerce”. Of course not. Rather it is to say “Don’t panic!” (yet).

Truly mobile commerce will generally require a different approach to in-home commerce (whatever the device being used). Couponing may be more important. Anti-showrooming tactics may be needed. And the user experience needs to be suited to the less stable out-of-home environment. 

These are difficult challenges. But, with true mobile commerce only 7.5% of total e-commerce, it is not too late to start experimenting with new approaches to sales conversion in a mobile context.


Showrooming: part 3

In my previous blog post I described how high street shop owners could combat showrooming by focussing on the things that shoppers like about physical shops.

The paper from Ericsson that I mentioned in my last post also analyses what people dislike about shopping in high street stores and compares this with the reasons people like shopping online.

This is of course useful information for any retailer who wants to identify how to persuade people to buy things in their stores rather than using them as showrooms and then shopping online. There are also some lessons here for retailers who want to reduce showrooming.

According to Ericsson, 51% of shoppers dislike physical shops because of the crowds and the queues. Perhaps there are lessons to be learned from theme parks here. Retailers could at least make the process of queuing to pay a little less boring. I am not suggesting they should get staff to dress up as Mickey Mouse and sing to the waiting shoppers! But retailers could at least provide music or video to people waiting in line. Willing buyers deserting their intended purchases because they are bored of queuing is a significant cause of lost sales and possibly a driver of showrooming behaviour.

The ability to compare prices and research items is a strong reason that many people (71%) like on-line shopping. Retailers can counter this strength by providing adequate information to enable people to research in store, perhaps through kiosks or of course adequately trained sales teams.

Another thing 33% of shoppers dislike is the fact that they are unable to go shopping 24/7 on the high street. This can’t, by its nature, be a major cause of showrooming. And it is hard to counter that except by reminding shoppers of the retailer’s website and perhaps promoting “when we are closed” offers that deliver some extra value to people shopping outside store opening hours.

Next in the line of shopper “hates” is poor service. Interestingly a lack of sales pressure is given as a reason for liking on-line shopping by 59% of shoppers. It should not be beyond retailers to provide good service together with a lack of sales pressure. Certainly grocery chains and DIY “sheds” seem to have this problem largely solved. However, poor service in shops as well as pushy sales people may well be reasons that people shop on-line but they are less likely to be drivers of showrooming behaviour.

Having a greater selection of items available is given as a reason to shop on-line by a majority (61%) of shoppers. However, only 12% of shoppers say they dislike shops because of the lack of choice. Indeed, reducing choice can often drive up conversion rates as people find it easier to select an item that suits them when they are not confused by having too many options. However, high street shops could usefully integrate their on-line shops into their high street shops. An example here is John Lewis: a shopper looking for an item that is out of stock in a particular store is likely to be taken to the John Lewis website by a shop assistant and sold the item on-line for home deliver or later “click and collect”.

Showrooming is a certainly problem for some retail categories, although perhaps not as large a problem as is sometimes made out, but there are definitely many things that retailers can do to combat it, both by enhancing the things that people like about high street shopping and by dealing with the reasons have for prefering on-line retail.

Showrooming: part 2

I came across an interesting paper from Ericsson today  part of which (page 9) reported research into what people in cities around the world like about on-line and off-line shopping.

So, following on about my previous blog on showrooming, I thought it might be useful to analyse this information with the challenge of showrooming in mind.

According to the Ericsson research, the things people dislike about online shopping are:

  1. Not being able to see or touch things (73%)
  2. Worry about credit card security (35%)
  3. Waiting to get purchases (30%)
  4. Lack of customer service (16%)
  5. Too much choice (11%)

In contrast the things that people like about high street shopping are:

  1. The ability to touch and see things (76%)
  2. Ability to take purchases home directly (59%)
  3. Its fun to browse (44%)
  4. Personal service (42%)
  5. Something to do with friends (28%)

Little of this is surprising. But it does indicate some opportunities for retailers who want to address the problems of showrooming.

Touching things

Points 1 and 6 are pretty obvious but in some environments could retailers do more to enable seeing and touching. For instance, a TV retailer could allow shoppers to use a remote control rather than having a long row of TVs all showing the same thing. And clothes retailers could ensure that changing rooms are well lit, clean, with adequate space and hanging facilities, to make the process of trying clothes on more enjoyable.

Credit card security

Point 2 did slightly surprise me but there is perhaps an opportunity for retailers to emphasise the safety and risk-free nature of paying in a shop through signage. This will be especially important for retailers using contactless payment systems where there is an existing perception of danger through paying for other peoples purchase, of double payment, and of paying for unwanted items.

Taking things home

Again points 3 and 7 are very unsurprising and the opportunities seem few here. Could clothes retailers encourage shoppers to “wear it now” by carefully packing the previously worn clothing – or offering to recycle it? Could TV retailers provide a better “carry to the car” service? Could PC retailers offer a “set up” service to enhance the immediacy of the purchase?


Points 4 and 9 are perhaps more interesting. Personal service is often desired (although there are big cultural differences around the world in this respect). It can often be difficult to get information and advice in a shop. For certain types of product advice could potentially be delivered via a kiosk or telephone, meaning that one client service operative could cover several different retail locations. That’s unlikely to work for fashion of course where advice (aka flattery) needs to be more face to face.


Point 5 proves the old retail adage: “don’t give me choice; make it easy for me to choose”. Some retailers could definitely improve here: for instance, TV’s tend to be grouped by size (which is pretty easy to judge) and perhaps it would be more effective to group them by one or two of the most important features (e.g. smart TVs, 3D TVs). Alternatively simply providing feature charts might be useful.


Points 8 and 10 emphasise the fun part of high street shopping, something that on-line finds hard to deliver. This is a big opportunity for retailers; department stores, garden centres and bookshops frequently contain coffee shops. What else can be done? For the bored partner trailing round the shops perhaps TVs, tablets (suitably secured) or magazines could be offered. Would more seating in shops provide a more relaxing and enjoyable experience? Would bigger changing rooms allow people to get private feedback about potential purchases?

This blog has been about how high street retailers can take better advantage of the things that shoppers like about the high street and dislike about on-line as a way of discouraging showrooming. My next piece will be about how high street retailers can defend themselves against the advantages that on-line shopping has.

Showrooming: part 1

Increasingly, consumers have smartphones and data packages that give them low cost access to the web outside their homes. As a result of this “showrooming” is on the increase.

Showrooming involves looking at items in a shop and then searching for the cheapest place to buy it on-line. This is seen as a major headache for many retailers who are simply acting as a showroom for shoppers who then buy elsewhere.

According to Pew research, over half of all shoppers use a mobile phone to research purchases while in a store and almost 30% of them either bought on-line or bought in a different store, a loss of 15% to retailers.

The good news is that these figures show that not everyone is a “showroomer”. In fact shoppers can be divided into:

  1. “maximisers” (who tend to be showroomers); these shoppers will focus on getting exactly what they want (price, features)
  2. “satisficers” (who tend not to be showroomers);  as the name suggests, these shoppers are happy with “good enough”.

And most people it seems are satisficers.

Also,  showrooming isn’t useful behaviour for quite a few categories. The lower the price, the less likely showrooming will happen; so greetings card shops and confectioners are pretty safe from this phenomenon. TV and computer retailers are much more affected. And fashion retailers, depending in part on the brand, are probably somewhere in the middle.

But nonetheless, if showrooming is taking away 15% of sales from high street shops, then it is a problem for many hard pressed retailers. Indeed some people have blamed the demise of Jessops and Comet on exactly this phenomenon.

And this behaviour is likely to increase as smartphone penetration increases and as more consumers learn maximiser behaviour.

Brands need to support retailers

Will the solution come from brands? Brands need high street stores so that consumers can see their products. Some brands like Samsung and Sony have set up their own retail outlets. But that won’t be possible for everyone.

In an ideal world, brands would help retailers to maintain high street sales, for instance by offering them items that are not available to on-line retailers. That might be part of the solution, but it won’t solve the problem on its own.

Shops need to find their own solutions

The solution lies in the hands of the retailers themselves. Charging customers for “just looking” or trying clothes on doesn’t seem sensible, although it has been tried. But there are plenty of other tactics that can be used.

The simplest tactic is to drive increased shop visits. In theory increasing shop visitors by around 17% should largely wipe out the effect of 15% showrooming. This might be done through localised marketing, including geo-targeted mobile advertising to the very people who are potential showroomers – smart phone owners.

Alternatively offering rewards for visiting a shop through schemes like Shopkick can pay dividends as well.

Once the consumer is in a store then a number of other tactics available. Price matching is perhaps the most obvious. In the USA Best Buy claims to be killing showrooming by offering price matching against local retailers and major on-line retailers such as Amazon.But that probably won’t be possible for smaller retailers.

Another important approach, which any retailer could embrace, is to make maximising behaviour more difficult or less attractive. Tactics here include:

  • Selling on service, rather than price; many people would say that this is what John Lewis do; despite their “never knowingly undersold” tagline many shoppers choose John Lewis because of service such as no-quibble returns, rather than because of price.
  • Emphasising things in-store that are hard to compare on line – brand values such as quality, complex sets of features; doing this can increase uncertainty that going on-line will result in the best deal.
  • Emphasising with overt in-store messaging the positive aspects of high street shopping: “the best choice”, “the best quality”, “the best service” etc.
  • Providing in-store give-aways to increase the shopper’s sense of obligation to the store (this won’t work with all shoppers of course).
  • Reducing the  “risk” of shopping in-store that maximisers perceive by providing customer endorsements about service quality and, if possible, price.

There are plenty of other tactics too:

  • Shops can implement in-store wi-fi that can connect shoppers to the shop’s own website before they are able to visit any other sites. And of course the retailer’s website can then display special offers or be used to up-sell and cross sell products.
  • Customer loyalty schemes may also have a place; while these can easily be neutralised by on-line customer loyalty schemes, it may be possible to provide loyalty schemes that have immediate benefits such instant rewards in-store.
  • High Street retailers can band together to provide reciprocal vouchers so that a shopper who purchase in shop A is given a voucher for shop B and vice versa.
  • There is a saying “Don’t give me choice; make it easy for me to choose”: on-line choice can be bewildering and stores can help people to choose through service and information.

Finally remember that for many people shopping is an important leisure activity. High Street retailers can enhance the shopping experience through added services, free gift wrapping, in-store events, a glamorous environment etc. They can even use data about the shoppers in store to “personalise” visits, either by encouraging customers to register and log into a store’s website, or even (as Burberry has been trialling with their “Smart Personalisation” scheme) by putting RFID tags in goods which can then provide a personalised in-store or after-store experience.

All in all, retailers don’t need to give up on showroomers. Instead they can use technology to drive more customers into their stores and convert them more effectively.