Editorial Articles

Finally, it seems, marketers and advertisers are starting to wake up to the fact that their mobile strategies should not be purely centred on smartphones. Traditionally one of the groups of ‘early adopters’ of technology themselves, marketing professionals have often assumed that the only mobile platforms worth involving in their strategies were the BlackBerry or the iPhone.

The move may seem long overdue to some industry pundits – particularly as it is well known that Apple’s iPhone only has a relatively small share of the global market (2.7% according to Gartner in August 2010).

What’s causing this mind shift you many ask. Well, there are two key drivers.

Firstly – and most significantly – is the rapid and massive growth in ‘feature phones’. Feature phones are phones which (in terms of functionality) sit in-between ‘old style’ mobile phones and smart phones. Some of the more recent feature phones – whilst unable to run software specifically written for smartphones, can however run applications based on Java ME or BREW. Last year (2009) feature phones accounted for 83% of all mobile phone sales in the USA.

Secondly, mobile transactions are set to increase. And increase rapidly; research published recently by trade bodies the IAB, AIME and IMRG found that two-fifths of UK retailers are planning to launch a transactional mobile site or app within the next year.

As mobile phones become increasingly viewed and used by consumers as multifunctional devices, so transactions will increase. A survey of 1798 mobile users that we carried out in February 2010 found that although the vast majority of purchases via mobile relate to mobile (e.g. ringtones, airtime etc.) a high proportion of respondents (23%) had bought from online stores, paid a bill and made bookings. Furthermore, 35% made some sort of transaction on a daily basis.

The fact is that people want to do more with their mobile – and transacting is a big part, particularly as mobile users are more commonly set to traverse major ‘life milestones’ such as house purchase marriage, or having a child.

Already, two high-street names, M&S and Tesco, recently announced their mobile strategies to support this trend. In August, Tesco announced it would be shifting its mobile strategy away from the niche smartphone sector to target mainstream users – they know that their core audience of mothers are not iPhone users and so are adapting their strategy to target this audience sector first.

In addition, Amazon recently forecast that it will generate $1.5bn in mobile transactions during 2010.

Certain retailers, Tesco, ASDA and IKEA are good examples, have an immediate advantage because of the fact that they are MVNO (Mobile Virtual Network Operators) and can therefore facilitate mobile transactions more easily. However, as well as needing to bring on board banking partners, the fact is that – MVNO or not – the vast majority of companies are not adequately prepared to transact via mobile. The IAB, AIME and IMRG research referenced above found that just 20% of the 20 most popular UK retailer websites are optimised for mobile.

As this illustrates, although the potential of mobile for brands looking to expand their sales channels is vast, there is still a long way to go. Not least, retailers need to more fully understanding the habits, desires and needs of their ‘unwired’ mobile consumers rather than focusing exclusively on the small proportion of consumers using smartphones. Once this is achieved, and customer trust issues are addressed, the next big thing could well be mobile.

Dr KF Lai
CEO, BuzzCity
BuzzCity Blog