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iPad – The Form Factor for Mobile Commerce

  |  February 15, 2011   |  Comments

How social plays a big role and how you can make your e-commerce tablet-friendly.

Consumers are using mobile to research product purchases, but not to transact. The question facing retailers is when will mobile transactions contribute to sales in a meaningful way? The answer is, when tablet (aka iPad) penetration rivals smartphone penetration. Today, according to a Consumer Electronics Pew Survey, tablet penetration (dominated by the iPad) is at 5 percent of adults. U.S. smartphone penetration, according to Nielsen, will be over 50 percent in 2011. Even though tablet penetration is one-tenth smartphone penetration, we're seeing evidence that the iPad is being used by consumers to transact.

The Smartphone Is the Form Factor for Mobile Research

The smartphone is recently established as the form factor for mobile research, a game-changer in consumers' pre-purchase behavior. Smartphone penetration is driving consumers' ability to research products and services from anytime, anywhere, and increasingly, that research is happening while standing in a retail store.

Here's the data:

  • Currently, 6 percent to 8 percent of retailers' traffic is from mobile, but much less than 1 percent of transactions are made on a mobile phone.

  • The top three pieces of information consumers are accessing via mobile is product price, availability, and customer reviews (the number one social tool in a consumer's buying process).

    halligan-1

  • Statistics on the days of the week consumers are using mobile to research provides more evidence of game-changing pre-purchase behavior. Usage on the weekend is the best indicator: on Saturdays and Sundays, consumers are accessing reviews on mobile devices 30 percent more often than on the average weekday. That means consumers are doing product research while standing in a retail store vs. researching only prior to a trip to the store.

    halligan-2

  • Checkout on a smartphone is not easy, so consumers aren't doing it. Take, for example, the Target checkout experience on an iPhone:

    halligan-3

  • The implication for retailers and brands is that your competitor is in your consumers' hands at all times and while they are standing in a retail store. Here's a typical scenario: a consumer walks into a store, finds what she came for, and, instead of putting the product into her cart, she looks it up on her mobile device. She sees what other products are recommended, other retailers (online or brick-and-mortar) that are carrying the product, at what price, and reads the customer reviews - which may tell them that a competitive product is rated higher. Unlike in the past, they can walk out of the store with confidence they can buy a better product, find the product they came for in stock elsewhere, or get a better price at another store or even online.

The iPad Is the Form Factor for Mobile Commerce

Tablet penetration is already respectable - there will be more than 50 million of them in consumers' hands at year-end - and growing steadily. The success of the iPad has spurred competitive response from Samsung, Motorola, LG, Vizio, and others, who all introduced or plan to introduce their own branded tablet product.

Here's the data:

  • Consumers are using iPads for research, accessing such product information as price and customer reviews. As the graph below shows, iPad access to customer reviews increased 77 percent the weekend after Christmas vs. Sundays before the holidays. Why? Because the iPad was a very popular Christmas gift - Apple sold 7.33 million of them in Q4 2010 - that were then used by the gift recipient to shop!

    halligan-4

  • A new baseline has been established. The step change up 77 percent established the new baseline from which growth continues.

  • Checkout experiences are easy to use with an iPad. Here's the same Target checkout experience (shown on the iPhone above) on an iPad:

    halligan-5

Making Your E-Commerce Tablet-Friendly

How can you position your enterprise to take advantage of the tablet's role in making retail purchases?

  1. Execute on the fundamentals but with more frequent updates. Consumers want accurate, up-to-date information on what's most important to them: price, availability, and customer reviews. So update this critical site information as frequently as possible. If you're currently updating every day, start updating two times daily. (Luckily, "likes" update in real time.)

  2. Organize your display based on what drives consumers to click "Add to cart." Make sure that all of the following are clearly visible on mobile devices (above the fold): product picture, price, and "social snippet." Also, try to make user-generated content easy to spot and browse quickly for "on-the-go" researchers. Consider the contrast in examples below:

    halligan-6
    Customer reviews are difficult to spot and browse. Summary information only includes average rating.

    halligan-7
    Customer reviews are built in to the user experience in a way that's easy to find and browse. Review Snapshot shows an at-a-glance summary highlighting pros, cons, and best uses of a product, in addition to average rating.

  3. Optimize checkout: The fewer clicks and data entry points required, the better.

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ABOUT THE AUTHOR

Cathy Halligan

Cathy has over 20 years of experience in both multichannel and online retail and a deep understanding of consumer needs and goals. Cathy's proven track record spans a range of industries and companies, from start-up ventures to multibillion dollar operations. Cathy is currently a Board Member at Ulta Beauty (ULTA), the largest beauty retailer that provides one-stop shopping for prestige, mass, and salon products and salon services in the United States. She has served as SVP, marketing & sales at PowerReviews, the world's most widely deployed social commerce platform, where she was responsible for overseeing the company's rapid customer and revenue growth. Prior to PowerReviews, Cathy held executive-level positions at Walmart: chief marketing officer Walmart.com, vice president of market development, global e-commerce, and vice president of product management and multichannel integration. Ms. Halligan has also held executive positions with leading retailers Williams-Sonoma, Gymboree, and Blue Nile, and was an associate partner at Prophet, a leading management consulting firm. She started her career as a marketing coordinator at Lands' End.

For real-time social commerce news and updates, follow Cathy on Twitter at @CathyHalligan.

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