Consumers Ignore Payment By Smartphone

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Consumers are not using their smartphones to make purchases but this could change in coming months claims Forrester Research.

According to a new report, consumers make about two percent of their online purchases through mobile devices, but that will change as merchants and consumers continue to adapt to the new devices, said Forrester analyst Sucharita Mulpuru in a blog post.

ChannelNews is aware that several retailers in Australia are getting ready to introduce new technology that will let consumers pay using a mobile phone. Among those retailers adopting smartphone technology to speed up payments is JB Hi Fi.

Currently, the mobile commerce industry stands at about $6 billion. Forrester expects mobile sales to grow 40 percent each year over the next five years, reaching $31 billion by 2016. But even then, Forrester expects that mobile sales will only account for seven percent of all web sales.

Several observers claim that consumers are shying away from smartphone purchases because of security concerns.

It’s a heavily debated topic among retailers, said Mulpuru. Security is one reason, as well as retail sites not being optimised for mobile devices. Shopping behavior and higher-priority activities on smartphones are also partly to blame. Mulpuru said that consumers frequently use mobile phones in a retail context — but to compare prices and look up product information, rather than make purchases online.

The report also found that checking the news and using social media outrank shopping on a list of ways people use smartphones. And the report doesn’t include tablets in its definition of mobile shopping, but the data suggests people who own both a tablet and a smartphone prefer to shop on the larger screen.

Mulpuru said mobile commerce will still transform retail, but likely due to actions taken by merchants. Introducing mobile devices to check out customers, prevent lost sales and help customers search for goods, could be the best strategy for brick-and-mortar retailers.

“While the opportunity to arm store associates with instantaneous information and richer payment acceptance capabilities may be the most compelling reason for retailers to invest in mobile, most companies view mobile as a channel that is primarily about completing sales through a mobile site,” she said. “And the most efficient retailers won’t even have their store associates doing those things — they’ll have their customers doing them themselves.”

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