Mobile commerce has seen considerable growth during the past two years. While there has previously been talk of “the year of mobile,” significant evidence now exists to suggest it has finally arrived. Since the introduction of the iPhone and subsequent smartphone releases, the way consumers access the internet has changed significantly. With mobile devices becoming increasingly sophisticated and connectivity issues being overcome, consumers are regularly turning to these devices to transact.
Recent comScore figures indicate that more than 110 million people in the US own smartphones, putting smartphone penetration at 47%. Google Android has been at the heart of smartphone adoption with a 51.6% share of the market, with Samsung and LG devices being the most popular handsets. Apple’s share has increased over the last few months, standing at 32.4%. It will be interesting to monitor the impact of the iPhone 5’s release over the coming months.
M-commerce is especially prevalent during holiday periods. The online deals site DealNews reported that July 4, 2012 had the highest percentage of overall traffic coming from mobile devices compared to any summer holiday in 2011 or 2012. On that day, 22.48% of all traffic to their site came via mobile. The iPad was the preferred device, accounting for 40% of all mobile traffic while iPhone and Android devices had 30% and 26% respectively.
The UK has also experienced enormous growth in mobile commerce through the affiliate channel. Global network Affiliate Window is seeing in excess of 13% of traffic being driven through mobile devices and 9% of sales. This growth has been dominated by Apple devices, but Android is beginning to catch up. With Android devices driving smartphone adoption, it is likely that they will gain a greater share of the market within coming months.
The percentage of traffic through mobile devices being greater than the share of sales, however, is indicative of a problem converting customers through mobile devices. Two issues are behind this. First, some advertisers fail to provide a fully optimized mobile experience. Without a mobile site in place, visitors will land on the standard ecommerce site and the user experience can be poor on a smaller screen. A site that has been fully optimized for mobile makes navigation far simpler, and consumers can add products to their baskets and check out with ease.
Second, advertisers that do have mobile-optimized sites often neglect the importance of affiliate tracking, causing them to miss out on a number of promotional opportunities through the channel. Affiliate tracking is the single most important aspect of running mobile activity. Without it, affiliates will not be rewarded for the sales they have generated and may choose to promote a competitor who includes mobile tracking. An optimized mobile site without affiliate tracking is a severe form of leakage, similar to call center phone numbers on landing pages. With the vast amount of affiliate traffic through mobile devices, it is imperative that transactions be trackable.
Where an advertiser has a mobile-optimized site in place complete with affiliate tracking, the share of sales through mobile devices, as well as average order values, has steadily increased. For one advertiser on the Affiliate Window network, the average order value through the mobile-optimized version of the site increased by 40% when compared against customers who transact through the ecommerce version of the site through a mobile device. Advertisers should look into the potential of call tracking to ensure that affiliates get rewarded for their efforts and encourage them to direct traffic through mobile.
When working with affiliates that offer cash back, tracking becomes even more important. Without tracking in place, customers will not receive their cash back, leading to a surge in untracked transaction queries. As a result, advertisers that do not have affiliate tracking in place will be flagged to visitors and will display an interruptive message stating that in order to receive cash back, the transaction has to be carried out on a desktop. This provides a poor user experience and could lead to the consumer not purchasing, or even worse, buying from a competitor that does have affiliate tracking in place.
Advertisers need to benefit from the increased traffic volumes they are experiencing through mobile devices by understanding a consumer’s motivation for visiting a site through a mobile device. Are consumers looking to purchase directly from their mobile device or is it purely a research visit? Are they looking to find directions to the nearest store, so the advertiser could benefit from driving consumers from a mobile device into specific stores?
The reason for the visit could depend on the sector the advertiser is operating within. For example, getting a quote for an insurance policy can be a complex procedure on a mobile device, so the intent of a visit could be to find the contact number to call for a quote.
The development of mobile commerce has allowed advertisers to become true multi-channel retailers. In addition to being able to transact directly through a mobile-optimized version of a site, advertisers can benefit from driving footfall into stores. GPS has allowed advertisers to target on location and push offers to consumers that have shown an interest in the retailer.
Affiliates have been the driving force behind technical innovations. While there was a lack of advertisers with a mobile presence, affiliates were able to innovate to benefit from the increased volumes of consumers turning to mobile. They were able to present visitors with coupons that could be redeemed in-store and drive the trend of mobile-led incentives. As more advertisers ramp up their m-commerce presence, these opportunities will become more prevalent.
The rise of m-commerce through the affiliate channel has been dominated by incentivized traffic. This is not particularly surprising when considering the major role incentivized traffic has played online. With savvy consumers aware there is a discount to be had, they are visiting incentivized sites through mobile devices and using a number of mobile apps.
Mobile commerce is a trend that will continue to grow. As smartphone penetration increases further, traffic volumes will surge. It is important that advertisers are in a position to capitalize on the growth trends within the affiliate channel. With spending through mobile expected to be at an all-time high in the run up to Christmas, advertisers need to be well prepared.
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