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© 2014 eMarketer Inc.

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Mobile Commerce Trends

Cathy Boyle

Senior Analyst, Mobile

July 24, 2014


Agenda

US retail mcommerce sales forecast

Types of products being purchased

Primary sources of sales

Factors and tactics that trigger sales

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US Retail Mobile

Commerce Sales Forecast


This year, 19% of US retail ecommerce sales will

come from purchases made on mobile devices


US retail mcommerce sales will continue to rise

at double-digit rates for the next four years


Two headline-grabbing milestones are on the

horizon:

1. In 2016, 1 in 4 US retail ecommerce dollars earned

will come from mobile devices

2. In 2017, US retail mcommerce sales will top the

$100 billion mark

Source: eMarketer, April 2014



Types of Products

Purchased


Physical

goods

comprise the

bulk of

US retail

mcommerce

sales


Year-over-year growth was robust for a number

of leading US retail categories in Q4 2013

Department stores: 49.6% growth in mobile sales

Health and Beauty: 81.7% growth

Home Goods: 38% growth

Apparel: 54.5% growth

Source: IBM Digital Analytics Benchmarks, Q4 2013


However,

mcommerce’s

share of US

ecommerce

sales is still

small and the

percentage

varies widely

by retail

category



On the digital product side, sales are also

climbing higher each year

Download and in-app

revenues are expected

to increase by 16.3%

in 2014 and another

16.9% in 2015


Ebooks are the

workhorses of

the digital

goods category,

but games are

steadily gaining

share


Primary Sources of Sales


The bulk of US retail mcommerce sales are

generated from three sources:

1. Tablet users

2. iOS users (iPhone and iPad)

3. Mobile websites



Tablet users

generate the

bulk of

US retail

mcommerce

sales


Tablet shoppers browse longer and add more

(and more expensive) items to carts

“The tablet mirrors desktop

behavior, so the tablet has

substantially higher

cart value, and users

are willing to purchase

larger carts.”

—Adam Foroughi, co-founder

and CEO of AppLovin

“On a tablet, they’re

leaning back and

browsing, so their

basket size will be

larger: two items,

three items.”

—Chris Mason, co-founder

and CEO, Branding Brand


Tablet buying patterns are closer to those seen

on PCs than smartphones


iOS users are still the most likely to buy

iPad and iPhone users

converted at higher rates

throughout 2013 compared

with users of other tablet

and smartphone brands



One reason: The iOS population in the US

remains true to its reputation for wealth

iPhones and iPads “have a very high

price point and are attracting a type of

buyer that is extremely likely to have

expendable income, be brand

conscious and more likely to

spend money.”

—Marcos Sanchez, vice president of

corporate communications for App Annie


Also, iPhone and iPad users overindex in four key

mobile activities:

1. Website usage

iPads represented more than 85% of US tablet visits to websites between Q1 2013

and Q1 2014; iPhones comprised between 59% and 62% of smartphone visits to

websites during the same period (Monetate)

2. Organic search

Over two-thirds of organic search traffic came from iOS devices in Q1 2014 (RKG)

3. App usage

iOS device users spend more time using apps (Flurry)

4. Email activity

iOS users generated 82% of mobile email clicks and opens in Q2–Q4 2013 (Yesmail)


Android users

are gaining

ground in

mcommerce,

but slowly

In Q2 2013 Android

smartphone order

values were highest


US mcommerce transactions are more likely to

occur via mobile websites

55% of adult shoppers

polled in December 2013

said they used their

smartphone to make a

holiday purchase directly

on a website

Only one-third (34%) used

an app

Mobile

Apps

Other

Source: Survey conducted by Baynote for the e-tailing group



Multiple factors contribute to websites

generating more mobile sales than apps:

Retailers gravitate to mobile websites first

– More retailers have mobile websites than apps

Big-spending tablet users turn to the web to shop

– Tablet users spent the bulk of their time (56%) shopping on

retailers’ websites in June 2013 as opposed to apps (comScore)

Retailers face competition from other apps

– US smartphone users spent just 2% of their mobile app time in

December 2013 using shopping-related apps (Nielsen)

Apps often lack ecommerce functionality


When it comes to apps, make sure the customer

journey makes sense for the customer

“There are a number of apps that

redirect back to the mobile

website to make a transaction.

Why use the app if it’s sending me

to the website anyway?”

—Len Shneyder, marketing manager at

OtherLevels


Factors and Tactics

that Trigger Sales


Creating the opportunity for impulse shoppers to

buy is one key to success

“A significant portion of the mobile

shopping that happened on

Black Friday actually took

place in the store. Customers

who were buying televisions actually

bought TV stands and racks for

installation [using mobile] while they

were waiting in line to pay.”

—Bao Nguyen, spokesperson for Wal-Mart

Global Ecommerce


The basics are worth reiterating …

Make it easy for smartphone and tablet shoppers to buy

easily, no matter which device they use

Minimum requirements:

– A mobile website with commerce functionality (responsive design is

recommended)

– A user interface built for touch navigation



Responsive design increased mobile sales by

183% for Champs Sports

Mobile conversion rate increased 33%

since launch of responsive site in 2014

Mcommerce sales grew by 183%

Mobile visitors increased 75%

Return visits rose 170%

Source: Mobile Commerce Daily, July 3, 2014


Simplifying the purchase process—making it

quick and easy—drives mcommerce sales higher

After integrating Google Wallet

Instant Buy, transactions

completed with Google Wallet in

Android apps quadrupled

Newegg added Google Wallet

Instant Buy to its mobile site and

found shoppers convert 100%

more often when using the

feature compared to checking out

with other payment options

Source: Internet Retailer, Dec 11, 2013


Giving mobile shoppers what they want—

coupons and deals—generates interest and sales

Recent email subject line emphasized

in-app discount offer: “Spend more time

with your selfie + 40% off mobile photo

orders!”

40% of Walgreens’ digital print orders

now come from mobile devices, up from

1% in 2010Image source: Mobile Commerce Daily, July 14, 2014


Mobile users not

only opt in to

receive coupons,

most redeem

them as well

This year, more mobile

coupon users will

redeem a coupon or

code via a tablet than

through a smartphone

That trend is expected to

reverse next year


Key takeaways

Mobile devices generate a significant share of US retail

ecommerce sales: 19% share in 2014, 25% in 2016

Physical goods generate the bulk of US retail

mcommerce sales, but revenue from paid downloads

and in-app purchases is growing steadily

Tablet users, iOS users and mobile websites are the

primary sources of US retail mcommerce sales

Creating the opportunity for impulse shoppers to buy is

one key to success; coupons are another


© 2014 Adobe Systems Incorporated. All Rights Reserved.

Adobe Mobile Consumer Survey 2014: Who are the “Mobile Elite”?

Ray Pun | Strategic Marketing for Mobile @RayPunSD


Adobe Mobile Consumer Survey 2014: Who are the “Mobile Elite”?

“Mobile Elite” segment spends more time and money via

mobile

• Mobile channels: Prefer mobile apps for shopping, followed by mobile

websites and finally regular websites

• Mobile wallets: 22% of the mobile elite segment reported using a

mobile wallet in the last 3 months, vs. 14% of the general consumers

• Augmented reality: 13% of the mobile elite actively used AR apps in

the last 3 months, vs. 9% for the general consumers

• Mobile assisted in-store shopping: 36% of mobile elite reported this

behavior, vs. 32% of general consumers


Adobe Mobile Consumer Survey: Best Practices

Download Survey: adobe.com/go/mobileconsumer2014

1. Review the mobile analytics data that you have today

2. Launch mobile channels with an optimization strategy in

place

3. Focus on “location, location, location”


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