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M-Commerce: Not Just For the Young and the Brave...

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Dr KF Lai, CEO of BuzzCity, a global mobile media company, shares his knowledge and findings from BuzzCity's latest Mobile Payments and Commerce survey to help brands/retailers that are looking to succeed with m-commerce in 2012.

We know that 2012 is set to be an exciting year when it comes to the mobile internet, as 2011 was nothing short of explosive. Across our own global mobile ad network alone over 126 billion were delivered in 2011 - almost two-and-a-half times more than 2010. There are a number of interested parties waiting in the wings to take advantage of this - a plethora of commerce and payment platforms have emerged, banks, carriers, payment providers, peer-to-peer transfer companies, virtual currency platforms and many others are all now competing for customers. However some brands who have attempted m-commerce in its early stages have failed. So what do brands need to be aware of when venturing into mobile commerce?

Demographics are changing...

As we know there has been a massive spike in smartphone adoption in the past year and the boom in mobile web usage is attributed largely to younger males, although female adoption continues to grow in many countries. According to our recent report there are nearly as many women as men using the mobile web in the United Kingdom (49%), Thailand (43%) and South Africa (40%). These markets are followed by France, Germany, Mexico, Philippines, the United States and Saudi Arabia, where at least a third of mobile web users are female.

While under-20's still make up a large share (28%) of mobile internet users, the proportion of mature users across the globe is growing (15% are now over 35). This is particularly true in France, Germany, Malaysia, Poland, South Africa, the United Kingdom and the United States where over-35s make up over 20% of each market. Poland, in particular, has a high representation (41%) of users over 35. Moreover, the influence of more mature users is disproportionately high when mobile purchases are made, maybe due to cash-rich, time-poor lifestyles. In France, although over-35s make up only 30% of mobile web users, they account for 67% of the mobile purchases for gadgets.

This group of users is also most likely to be a catalyst for mainstream adoption of m-commerce, as their intent towards repeat purchases is disproportionately high. They're most likely to drive m-commerce in the areas of travel, gadgets, groceries and prepaid utilities in many markets. In the UK, for example, over-35s make up only 23% of mobile web users, yet they account for a third of those who plan to buy gadget via their phoness in future.

What are they buying?

When it comes to the Brits, entertainment and lifestyle items such as books, music and movies for home delivery as well as gadgets are all regularly purchased items, with one in five all avidly buying these via their phones. In the travel market 10% of UK consumers are keen to use their handsets to buy tickets and source hotel accommodation with growing usage.


All the signs are very encouraging...

So you'd be forgiven for thinking that everyone with a mobile would be interested in making their lives easier when it comes to paying for these goods via their phones? In fact, users remain reluctant to engage in remote transactions, with 39% preferring to pay in person, and 21% preferring to charge purchases to their phone network bills. The reason behind this is more consumers perceive m-commerce to be complicated and risky despite the wider choice now available. The biggest barrier to mobile commerce is the lack of awareness of the tools and services available (35%); our latest survey reveals that 35% of users aren't aware of the basic mobile transactions available. Those who are aware of these commercial platforms find the services "too complicated" (21%), or are worried about security (27%).

Where next?

With more consumers gaining trust in mobile and brands taking advantage of spending power maturity the entire mobile ecosystem will benefit in coming months, ultimately paving the way for further demand for mobile and lifestyle content as well as mobile commerce offerings. If the industry clarifies their communications, reassures users about their security concerns, and overcomes the confusion then 2012 looks set to be an exciting year.