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Smartphones begin to rival tablets as commerce powerhouse

By
December 3, 2014

Target's mobile Web site

Target’s mobile Web site

While tablets are known for driving more online commerce sales than smartphones, results from the recent Thanksgiving holiday weekend point to how quickly the latter’s star is rising.

Smartphone traffic and sales growth outpaced tablets in some cases over the Thanksgiving weekend. The results reflect the growing adoption of large-screen smartphones, consumer interest in shopping in-store from a phone and online experience that are better optimized for mobile.

“We have seen strong growth for both smartphones and tablets throughout the holiday season,” said Jay Henderson, strategy director at IBM ExperienceOne. “And we’ve seen consumer behavior evolve such that the different devices are used for different tasks.

“Consumers are using their smartphones to browse and their tablets to buy,” he said. “This means retailers are streamlining their Web sites and apps for smartphones, making information more easily accessible on-the-go, providing information like store locations, hours, merchandise – while also making these elements easier to access and navigate.”

Faster growth
Adobe reported that the smartphone share of total online sales on Cyber Monday was 11 percent, up from 6 percent last year. At the same time, tablet’s share was 15 percent, up from 12 percent.

While tablets had the higher share, smartphones grew at a faster pace.

Figures from IBM reinforce smartphones’ growing role in driving online traffic while underscoring tablets’ ongoing strength at converting sales.

Screen Shot 2014-12-02 at 4.38.37 PM

Smartphone screen sizes are getting bigger.

On Cyber Monday, IBM found that smartphones drove 28.5 percent of all online traffic, more than double that of tablets, which accounted for 12.5 percent of all traffic.

However, tablets drove 12.9 percent of online sales compared to 9.1 percent for smartphones, a difference of 41.5 percent.

Tablet users also averaged $121.49 per order compared to $99.61 for smartphone users, a difference of 22 percent.

Tablet adoption slows
The trend toward a bigger role for smartphones was echoed elsewhere.

During the Thanksgiving weekend, smartphone traffic accounted for 21.4 percent of all online traffic, an increase of 37.71 percent from last year, according to Monetate. Tablet traffic accounted for 22.58 percent of all online traffic for a smaller increase of 7.17 percent.

On Thanksgiving Day, smartphone traffic increased 51.9 percent and smartphone revenue increased 49.1 percent.

Screen Shot 2014-12-02 at 4.42.16 PM

Sales of tablets are slowing.

The results point to how Black Friday is extending into the Thanksgiving holiday itself as well as into the weekend as shoppers decided to take advantage of online specials to make purchases via smartphones and tablets wherever they were and without the need to make a special trip to a store.

“Based on our data, both smartphones and tablets have seen big gains in terms of driving traffic and revenue,” said Lucinda Duncalfe, CEO of Monetate.

“With increased screen sizes and mobile payment options, it’s now easier than ever before for consumers to shop whenever and wherever,” she said. “As a result, we continue to see smartphones taking a larger piece of the mobile commerce pie.”

With tablet adoption beginning to slow, the numbers also suggest that smartphone’s role in online commerce could grow going forward.

Worldwide tablet sales this year are expected to slow to 7.2 percent from 52.5 percent just a year ago as owners hold onto the devices longer, according to a recent report from International Data Corporation (see story).

Streamlining complex engagements
At the same time, with the introduction of the iPhone 6 Plus, which has a larger screen, and the continued popularity of a variety of Android phones boasting larger screen sizes, it is easier than ever for consumers to research and purchase items of interest from their phones.

Retailers also continue to support consumers’ desire for on-the-go shopping by enhancing their mobile experiences via image recognition, payment options such as Apple Pay or PayPal Express Checkout and other features.

The smartphone’s role in-store also continues to grow thanks to beacon technology, in-store Wi-Fi, push notifications and other technologies that make it easy for retailers to engage shoppers directly when they are inside or nearby a store.

“Given the explosive growth in mobile the last few years, this holiday, we saw retailers investing in their mobile applications and Web sites in anticipation of the holiday season,” Mr. Henderson said.  “Engaging the mobile shopper is no easy task – diversity of devices, variety of screen sizes, landscape versus portrait layout, all make this sort of engagement complex.

“Given this complexity, retailers must deliver a streamlined experience that is easy to navigate on a mobile device,” he said. “By investing in customer experience monitoring, retailers can more easily identify gaps in their mobile Web sites and most importantly, areas where consumers might be struggling.

“With smartphones becoming the remote control for consumers as they shop, it will be crucial for retailers and marketers in 2015 to bring the best of the online shopping experience into the store. Smart retailers are investing in guest Wi-Fi programs and mobile apps that allow consumers to browse on-the-go, price compare, or even see what inventory is available for in-store pick-up – all through their mobile device.  Ultimately those retailers who embrace showrooming and turn it into a competitive advantage, will be the real winners in the New Year.”

Final Take
Chantal Tode is senior editor on Mobile Commerce Daily, New York

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