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Mcommerce resistant to spending slump: Kantar Retail

July 20, 2010

Mcommerce could become a convenient tool for shoppers looking to bargain hunt

Mcommerce could become a convenient tool for shoppers looking to bargain hunt during tough times

Consumer purchases through mcommerce are not likely to experience a big drop-off even as overall spending slumps, according to Kantar Retail.

The research and consulting firm released its June 2010 ShopperScape consumer spending report and predicted tightening purse strings in the wake of challenges like the Gulf oil spill and a stalled job market. Mobile commerce, however, seems mostly unaffected by these trends, per Kantar.

“To a small degree mobile commerce could see a downward effect,” said Steve Mader, analyst at Kantar Retail, Boston. “But, at the same time, mobile commerce is growing so rapidly that it is not likely to see a significant decrease in the number of dollars spent.”

Kantar’s ShopperScape reports survey 4,000 consumers each month to find out where and how they are shopping.

Consumer’s tightening belts
Kantar’s data shows that the share of consumers planning on cutting back on spending has been decreasing since 2008.

However, in June that trend saw signs of stalling.

Here is a Kantar graph illustrating the changes in consumer spending plans over the past two years:


The share of consumers planning on spending more has dropped, while the share planning on spending less has increase.

Since June 2009, consumers have more optimistic about certain things such as job security, according to the report.

However, anxieties remain high concerning credit-card debt, long-term debt and the worth of their investments.

The share of shoppers who are more nervous about their credit-card debt increase by 2 percent, while the share who are more optimistic declined by 3 percent, indicating that consumers are feeling the pressures of higher living expenses, per Kantar.

“Anecdotally, I could say that as people are starting to become more price sensitive, people will start using mobile applications to price compare,” Mr. Mader said. “So for example, if you’re in a Barnes & Noble or Borders, you have an app that lets you scan a barcode, lists all prices available on store and on Amazon.

“If there’s a big price difference, shoppers could be more prone to buy online,” he said. “You could see people purchasing books online from their mobile phones in other stores.

“Price hunting and bargain hunting is further enabled for mobile phones.”

Bargain hunting for Generation-Y
Retailers are already making the move into mcommerce, en masse.

A Gomez report found that the mobile Web is crucial for the in-store shopping experience. (see story).

And, retailers seem to understand that, since one in five already have a fully-realized mobile strategy, and three out of four have plans for one (see story).

Retailers who launch mobile initiatives that aid consumers in bargain shopping stand see gains with consumers age 18-32, per Kantar.

“Mcommerce is a way of going after Gen-Y consumers, Millenials, people right around age 18-32,” Mr. Mader said. “These consumers are in their family-formation years and have a lot of outflow in cash.

“They are really more tuned to how much things cost,” he said. Even though they may have significant income, they may have more expenses than other generations do.

“And, since they are used to using these technologies, it’s likely they will be shopping on them.”

Final Take
Peter Finocchiaro, editorial assistant at Mobile Commerce Daily, New York

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