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Will Cyber Monday ecommerce boom translate to mobile riches?

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November 24, 2010

HP is one of many brands running Cyber Monday promotions

HP is one of many brands running Cyber Monday promotions

Savvy retailers and merchants are waiting with baited breath to find out whether or not the predicted boom in ecommerce sales on Cyber Monday will translate to increased transactions via their commerce-enabled mobile sites and applications.

According to consultancy Primacy Impact, this is not the year or day of mass mcommerce adoption—with the exception of mega ecommerce players such as Amazon and eBay who have well developed applications that link into established one click payment accounts. But it is the year that retailers woke up to how mobile devices relate to retail in a way no other media has before.

“It blindsided a lot of retailers, but who could ignore people walking around in a store tapping their smartphones?” said Kathryn Koegel, marketing practice lead at Primary Impact, New York.

“They certainly weren’t playing games—they were looking for info on products, reviews, recommendations from their social network, store availability, store locations and also for coupons,” she said.

“I’m hot on mobile coupons because there is really no sign of this recession being over.”

Mobile couponing on the rise
Inmar, the company that processes coupons in the U.S., reported that coupon redemption was on the rise this year for the first time in years.

Ninety percent of coupons are distributed through freestanding inserts in newspapers, which now reach less than one-third of the population, so a lot of that activity has to shift to mobile.

It is already, with major retailers such as Target, Best Buy and The Gap having sophisticated mobile couponing programs delivered through text, email and their own applications.

“There’s less waste than through print and redemption tracking just ties into their CRM systems,” Ms Koegel said.

Marketers, retailers and merchants that offer mobile coupons on Black Friday and Cyber Monday will have a better chance of benefitting from the holiday-season shopping bonanza.

Retailers that have optimized experiences for the iPad can also expect a healthy amount of traffic—and transactions—on tablets this holiday season.

Rosy outlook for mobile commerce this holiday season
This is the year that a much broader range of retailers got the point of mobilizing their Web sites—a shocking number have not done that—and made it easier to use mobile devices to get key on-the-go store information, per Ms. Koegel.

Those with branded applications—Ms. Koegel believes that not every retailer needs one—have created simpler storefronts that make this year’s hot items easy to find.

Even if consumers do not complete many transactions using their handsets, if they are comparing prices, viewing products details, reading reviews and using store locators on the mobile Web or within applications, mobile-savvy merchants can still benefit.

“While a relatively small percentage of consumers will actually buy via the phone, the retailers who cover their mobile basics and let consumers know they have it, where it is and at what price will be the big winners,” Ms. Koegel said.

Mobile traffic leads to mobile transactions
Forrester Research does indeed believe that mobile commerce will surge this holiday season, especially on Black Friday and Cyber Monday.

Retailers have told the research firm that they expect to see a lot of mobile traffic, and where there is higher traffic, there are usually higher sales.

Last year, retailers reported that about 10 percent of their overall Web traffic came from mobile devices on Black Friday, and Forrester expects that figure to be even higher this year.

The physical retail experience is still such a big part of the equation, with 80 or 90 percent of what most consumers spend is in general at bricks-and-mortar stores.

That said, even if a fraction of ecommerce spend is via mobile devices, it will still add up to a significant amount.

“People are using their mobile devices for reading product reviews, comparison shopping and to remind them of specials, basically having their shopping list in their mobile phone,” said Sucharita Mulpuru, Charlotte, NC-based vice president and principal analyst of ebusiness and retail at Forrester Research.

“Transactions via mobile devices should happen too,” she said.

On average, Forrester estimates that 3 percent of all Web transactions are via mobile devices, and Ms. Mulpuru expects that to be seasonally higher during the holidays.

Certain types of businesses such as consumer electronics skew much higher in terms of sales on mobile devices.

“Retailers with limited-time offer and high-ticket product with consumers looking for the best value, mobile is ideally suited to deliver on those needs for people on the go, and those needs will be more pronounced during the holidays,” Ms. Mulpuru said.

“Three percent [of total Web transactions] could easily be 6 percent via mobile devices this year,” she said. “We could easily see a doubling of the mobile traffic that is there, as well as a doubling of transactions via mobile devices.”

Or not so rosy…
So the question remains: Will the ecommerce boom on that day translate to commerce-enabled mobile sites and appliations?

Other analysts are less optimistic than Ms. Koegel and Ms. Mulpuru. Some believe that Cyber Monday may not mean all that much for mobile.

“I don’t see mobility meaning much for Cyber Monday,” said Greg Girard, program director of merchandise strategies and retail insights at IDC, Framingham, MA.

“That’s a desk-bound or laptop-enabled activity now,” he said. “It’s about buying, and buying a lot quickly, and mcommerce isn’t yet a platform for transacting purchases.”

Final Take
Dan Butcher, associate editor, Mobile Commerce Daily

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Dan Butcher is associate editor on Mobile Commerce Daily and Mobile Marketer. Reach him at dan@mobilemarketer.com.

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