The future of commerce: 3 trends shaping how we buy and sell
With commerce constantly evolving, how can your business keep up with the latest trends and plan for the future? We've got you covered.
For those who don’t realize this yet: mobile commerce IS commerce, full stop – and the power of m-commerce is only expected to keep growing.
In fact, it’s practically moot – meaning that shopping from your phone is so mainstream, you don’t need to call it anything other than simply “shopping.”
There’s a valid argument in saying that mobile commerce — which goes beyond shopping to mobile banking and payments — is becoming popular partly because it’s demolished barriers that can discourage consumer engagement, making for fewer high-friction interactions.
What is mobile commerce?
Mobile commerce is the use of a smartphone or other handheld wireless devices like tablets and cellphones to conduct commercial transactions online. These transactions including buying products and services, paying bills, and banking online.
Mobile commerce is also called m-commerce or mcommerce.
So isn’t it m-commerce just e-commerce? Sort of, but there’s a difference. E-commerce is the broader term for the buying and selling of goods and services via the internet. It can be conducted via a desktop computer, laptop, or mobile device. M-commerce uses smartphones or other handheld device, which makes it supremely flexible.
The phrase “mobile commerce” was coined in 1997 by Kevin Duffey at the launch of the Global Mobile Commerce Forum. He defined it as “the delivery of electronic commerce capabilities directly into the consumer’s hand, anywhere, via wireless technology.”
Today, it’s often broken down into three types: Mobile shopping, mobile banking, and mobile payments (for example, using ApplePay to buy an item at a store).
Mcommerce is available through websites optimized for mobile devices, dedicated apps, and increasingly, social media sites.
M-commerce examples: 3 brands that are absolutely crushing it
Mobile commerce, or m-commerce, is rising fast as more shoppers are shopping, paying, and banking on their small screens, with expectations for the same seamless experiences they've come to expect when shopping on their laptops and desktops.
Mobile commerce: By the numbers
Adoption of mobile commerce is soaring with more and more consumers using their smartphones to buy items, get tickets for travel and events, transfer money to a friend, and pay bills.
- In 2022, mobile retail e-commerce spending in the US more than doubled since 2019, topping $387 million, according to Statista.
- As the end of 2022, smartphones accounted for nearly 74% of retail site traffic worldwide and generated 63% of online shopping orders, Statista reports.
- eMarketer’s Insider Intelligence expects global retail m-commerce sales to reach nearly $4.5 trillion by 2024, and make up 69.9% of total retail e-commerce sales.
- 37% of US adults used mobile sites to conduct transactions, up from 29% in 2021, according to a Retail Dive report on Forrester’s 2023 Retail Mobile Websites study.
With 85% of Americans now owning a smartphone and an estimated 6.6 billion smartphone users worldwide, m-commerce will continue to skyrocket.
Benefits of mobile commerce
While mobile commerce offers the ultimate convenience for consumers, it provides multiple ways for businesses to boost customer experience for better engagement and more sales.
- Accessibility: Like e-commerce, mobile commerce is available 24×7. But with consumers so tethered to their smartphones these days, it’s even more accessible. This means more opportunities for retailers to reach customers, make sales, and drive loyalty.
- Omnichannel commerce: Consumers today expect to do business with companies anytime and anywhere. Mobile commerce enable companies to provide seamless experiences and meet customers on their preferred device.
- Better data: Mobile commerce provides retailers with deeper data about customer habits and preferences throughout the buying journey, from discovery to purchase.
- Personalized experiences: Brands can leverage customer data gleaned from m-commerce to provide tailored journeys and promotional offers. For example, brands can send push notifications based on a shopper’s physical location, which mobile technologies like GPS support.
- Convenient payments: M-commerce expands the range of payment methods, making it easier for consumers to buy goods and services. Mobile wallets like Apple Pay and Google Pay allow customers to use their smartphone for in-store purchases. Payment services like Amazon Pay provide one-click buying. Other options include Venmo and Paypal.
These digital payment solutions reduce friction at the most important part of mobile commerce – the actual transaction.
By remembering your credit card information and easing input of that information into the system, in-app purchasing reduces checkout speeds to mere seconds.
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A work in progress: M-commerce disadvantages
Despite all the benefits, a frictionless mobile commerce world has yet to become reality for so many. Barriers remain in the mobile customer experience for many sites.
Here are some of the main drawbacks to mobile commerce:- Unless they’re optimized properly, mobile apps (and small screens) can make it difficult to find items and complete transactions. That can lead to frustrated customers and abandoned shopping carts.
- Mobile optimization can be an intensive exercise and requires ongoing work to ensure smooth experiences that meet customers’ rapidly changing expectations.
- Lower conversion rates compared to e-commerce. The conversion rate for m-commerce is about 1.8% compared to 3.9% for e-commerce via desktops.
- Customer data privacy and security. With more access to customer data, businesses must take every precaution to protect customer confidentiality and security. Cybercriminals are always looking for vulnerabilities and wifi is a prime target.
- Supporting digital payments can get tricky, especially at scale, due to the wide variety of options available today and varied preferences around the world.
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Mobile commerce is social commerce
Nearly 40% of the world’s population engages in some form of social media, and much of that engagement takes place on mobile devices.
Social media has revolutionized consumer behavior, driving growth of social commerce. where brands use sites like TikTok, Instagram, and Facebook to drive sales.
Today, social media advertising, influencer marketing, and community building (via social channels) are major customer acquisition strategies for leading brands.
And for good reason. According to Retail Dive, 80% of Generation Z and 74% of millennials report that social media influences their purchases.
Take Glossier as a quick case study.
“Glossier harnessed the power of user-generated content as part of a successful social media marketing strategy,” writes Springwise in their 9 Trends for Retail report. “By reposting images, videos and product takes from their social media followers and offering other incentives like free product giveaways to brand loyalists, it has created an army of what are known as ‘Glossier Girls.’”
Social media platforms from Instagram to Snapchat are merging the line between discovery and purchase, with the goal of making purchases easier. Shoppers don’t have to leave the app to make a purchase.
Social commerce growth: A matter of trust
Shopping on social media platforms is expected to increase three times as fast as traditional e-commerce, but brands need to build customer trust to boost adoption.
What’s next: M-commerce trends to watch
With so much growth ahead, mobile commerce will continue to transform the way we shop. Here are some trends to keep an eye on:
- The Gen Z factor. This up-and-coming, digital-native generation is leading the way when it comes to mobile shopping. According to a Klarna study, 76% of Gen Zers have shopped more on their mobile phones compared to two years ago; that’s a sharp difference to 56% of the overall population.
- More mobile payment options with cryptocurrencies gaining traction. Cryptocurrency enables super fast transactions since payments are transferred directly between two parties.
- Growth of voice commerce. Shopping via smart speakers and voice assistants or virtual digital assistants such as Amazon Alexa and Apple’s Siri was expected to grow to about $40 billion US dollars in 2022, up from $2 billion in 2017.
- Getting real with AR. Artificial reality continues to improve online shopping with virtual try-on and other technologies to help consumers evaluate products and buy with confidence.
Mobile commerce can be leveraged as a catalyst for dynamic and personalized consumers experiences. To do so, brands need to think beyond their own mobile site or social media to elevate and incentivize super fans as micro-influencers within the community. Provide these brand fans with the tools to build an audience and monetize their expertise.
This is the type of blended thinking you need to have for a smart brand strategy on mobile and beyond. It’s about brand and product discovery, as well as consumer elevation for the word of mouth marketers they are.
“Global brands are embarking on unconventional partnerships that blend worlds to create innovative retail discovery experiences for a young cohort of mobile-first and digital-native shoppers,” reads Wunderman Thompson’s Future 100 2020 report. “Successful retailers will meet Gen Z’ers and millennials wherever they are, whether it’s in a virtual game or on new streaming platforms.”
M-commerce is becoming the preferred path to purchase thanks to convenience. With their wide adoption, mobile devices democratize information, individuals, and brands.
How you leverage that democratization and empower your customers as fans on all mobile channels will define the future of your brand.
