In the first of a series of articles serialised from Paul Skeldon's seminal book M-Commerce, published earlier this year, we give you some facts and stats to demonstrate the ever-growing importance of mobile business
As the online retail sector has exploded, so too has the popularity of smartphones and tablets – opening up a vast new frontier in the e-commerce realm.
In the fourth quarter of 2010 the sale of mobile smartphones – essentially a phone on steroids that combines a voice telephone with the capabilities to access email and calendars via the web, as well as download software applications (or apps) – outstripped those of desktop PCs globally. That means, in the latter part of 2010 more people bought a smartphone than a computer.
Furthermore, IDC Research estimates that European smartphone sales grew by 99.4% in Q4 2010 compared to the same period in 2009, with some 25.6 million smartphones being shipped in that period, bringing the total Western European mobile smartphone market to just shy of 60 million units. In the US, smartphone penetration is about 40% of the market for phones and growing rapidly. There are 234 million mobile phone users of one kind or another in the US, believes comScore, so there are around 94 million smartphones in the market.
One spin-off from the smartphone revolution has been the creation of what seems to be a wholly new type of mobile device: the tablet computer. Exemplified by the Apple iPad (now on its second iteration) but also leading to a raft of devices by, among others, Samsung (the Galaxy), BlackBerry (the Playbook), and even Hewlett Packard (the TouchPad), the tablet computing world combines the computing powers of the laptop, with the keyboard-less, touchscreen technology and portability of the smartphone to produce a device that is at once genius and absurd.
According to Neilsen Netratings, a firm which analyses who does what online with what device, penetration of tablets in the US market (by far the most advanced tablet market) is 4% – a small but significant number and only 2% lower than e-book readers and 4% behind netbooks, as of the end of 2010.
Significantly, of the kind of people who consider themselves to be ‘early adopters’ of technology – you know the type, skinny jeans, black framed glasses and beards – tablet penetration is 48%. Those in the know have already embraced them with alacrity.
Financial value
M-Commerce is a hard beast to tie down and measure. Defining exactly what it is and then measuring the money that goes through it, the profit extracted from it and general value of the market, regionally and globally is a tough one. But there are clear areas that are revenue generators that are purely mobile commerce and these have been ‘measured’ through the tried and trusted technique of ‘guestimation’ – the technical term for licking one’s finger and holding it in the air – and have arrived at some startling figures.
In Japan, by far the most advanced and long lived mobile commerce market, ABI Research values the m-commerce market at some $10bn. In the US, relatively immature as a mobile commerce market, ABI suggests the figure closer to $2bn, despite tripling in size between 2008 and 2009. Worldwide, ABI predicts that m-commerce in all senses – buying tangible goods through to buying content and services that will be consumed on the device will be worth about $120bn by 2015.
What is interesting about m-commerce is that, while it is looking like being a $120bn global market by 2015, it has yet to really reach its true potential. To date we have seen only the beginnings of mobile commerce and what it can achieve. So far we have largely concentrated on how the mobile can be used to buy and consume content and touched on the fact that it can also be used to buy tangible goods, much like a phone-based version of e-commerce.