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Mobility Drives Commerce

Denise Culver
LR Mobile Column
Denise Culver
3/10/2009
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Twenty years ago, few could have imagined an economy in which people regularly make purchases – billions of dollars worth of purchases – while sitting behind their personal computers from the luxury of their homes. But that is obviously the reality today. And, in another 20 years, the reality will be that people will use mobile devices to do the same thing. In fact, this is already beginning to happen.

People act differently today than they did even two years ago. They do things with mobile phones now that they simply did not do then: take pictures and videos, play games, listen to music, watch TV, surf the Internet – and, yes, buy things.

Making purchases via mobile phones or smartphones – a practice that is known by several monikers, including mobile commerce, m-commerce, m-payments, or u-commerce (for the ubiquitous nature of mobility) – likely is already available on mobile handsets, even if users are not aware of this option.

It will not be long before users are as aware of m-commerce as they are of e-commerce, says Carol Realini, CEO of Obopay Inc. : "M-Commerce enables us to extend the mobile brand to additional aspects of customers' lives. Mobile payments represent a logical expansion of mobile services."

That is just one of the findings in this month's Unstrung Insider, "Dial M for Commerce: Mobile Payment Market Gains Traction."

M-commerce is happening in several verticals – most notably retail and banking – as well as global markets. Many factors have converged to make mobile commerce in retail a high-growth vertical. First is the fact that smartphones have become so prevalent, providing users with more powerful interfaces, including faster access to the Internet, easier input methods (such as full QWERTY keypads), larger screens, and more processing power.

Also important, however, is the fact that consumers appear ready to accept m-commerce as a viable option, says Dave Sikora, president and CEO of Digby Mobile Commerce. "A growing percentage of consumers have indicated that they are now willing to receive marketing messages on their phones. This has driven a surge in mobile marketing and advertising that is expected to continue to grow at an aggressive pace. Consumers have become comfortable using their phones to browse for information and do research or price comparisons but have not yet become completely comfortable entering credit card information on their phones. This is similar to the early days of e-commerce."

But, as history has shown, when consumers are given more convenience and mobility, they will take chances on security to enable vendors to prove that their systems work. This will be the case for m-commerce, and the result will be a strong economy for the market as consumers become more aware of m-commerce options and vendors begin to tout the services and goods they have to offer.

— Denise Culver, Research Analyst, Unstrung Insider




The report, Dial M for Commerce: Mobile Payment Market Gains Traction, is available as part of an annual subscription (12 monthly issues) to Unstrung Insider, priced at $1,595. Individual reports are available for $900. To subscribe, please visit: www.unstrung.com/insider.

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