M-commerce is the newest member to the multichannel family, e-commerce’s youngest sibling. However like many prodigies, this new family member is already causing ructions and sleepless nights.
The initial success of m-commerce is clear for all to see. Dominos Pizza announced after the launch of mobile payments in 2012, that it transacted £1 million of business in the first week. The prodigy, it seems, walks and talks very quickly. The question is that if you launch a new channel with such significant and fast success, what is the wider impact to your brand, technology and business operations if things go wrong?
The same overnight success happened with the early days of the web and e-commerce. In July 1995, Amazon sold its first book and ten years later had a larger revenue than Wal-Mart. Now Amazon is estimated to turnover $100 billion a year by 2015 and its m-commerce operations are growing even faster than e-commerce did.
However Amazon suffered with significant outages in 2011 because of its cloud computing network. Apple is another example of what happens when things go wrong. The once virus immune company has recently been hit by a rather nasty Trojan affecting an estimated 600,000 Macs.
It is fair to assume that with the rise of complex phone operating systems, security and antivirus technologies should also be considered for mobile. The house of e-commerce (and m-commerce) is built on a foundation of technology after all.
Data loss, fraud, outages, viruses and security issues all plague online shopping and services. So far, mobile commerce has often sat under the wing of an online service and support infrastructure, most of which was designed with a very different internet experience in mind. But is this truly the best home for our newest family member?
Mobile channels come with their own unique requirements, such as multiple operating systems; network operator services; third party app stores; mobile payment solutions and specialist code and standards for applications. One of the main challenges comes from working across multiple operating systems from different mobile phone manufacturers, which brings with it a degree of complexity around support and development. What seems to be same app to consumers has lots of different underlying coding and skills behind it for developers. As a result, an m-commerce app has very different technical requirements to a Facebook app or website, possibly even requiring it to be built three or four different ways. Many businesses won’t have the in-house expertise to fix bugs, support the app and enhance and upgrade multiple formats.
It’s also important to understand the number of third party servers and business involved. With e-commerce, businesses are generally able to sell products and retain 100% of the revenue, minus a small payment handling fee. However, the app stores may take up to 30% of the in-app purchase revenue, making a dint in your bottom line figures. Take this into account and don’t expect to see the same sales figures coming through online and through mobile.
With over 72 million mobile subscribers in the UK alone, it’s hardly surprising that m-commerce delivers large sales successes quickly, but given these specialist complexities, most businesses are not geared up to support the rapid growth.
The first sign many businesses get about the wider impact of a successful mobile channel is when a mobile app that started life in the marketing department suddenly starts to consume resources in the IT, CRM, sales and multichannel departments. So who is left holding the baby when something goes wrong?
As the market matures and the mobile channel starts to become a key part of many businesses, more and more people will find themselves in need of a clear mobile strategy that takes on board the implication to the whole company. New specialist support services dedicated to the mobile channel will ensure that this new addition to the multichannel family becomes a bundle of joy and not a problem child.
Top tips for ensuring your m-commerce runs smoothly:
> Have the right equipment and processes in place – old technology might be ok while you’re starting out but once demand increases, it could fail quickly – if your m-commerce app becomes a significant transactional vehicle, it may be that you have a dedicated payment feed/ transactional log that is hosted remotely. You might promote your app through the Android store and use maps, location and RSS feeds. What happens if they suddenly become unavailable or fail? Where are the different data feeds coming from and who will take responsibility? Make sure you have service level agreements and protection in place for the different elements, from the servers they sit on to the data sources you receive
> Keep it simple – m-commerce shouldn’t necessarily look like your e-commerce solution. Consumers need simplicity – shorter business processes, fewer clicks, fewer forms to fill in, optimised graphics and text and easier purchasing journeys. A recent survey by JWT showed that consumers thought the m-commerce experience could be improved, especially when it comes to navigating sites, accessing product information and mobile web security
