Mobile Commerce Is Positioned For Rapid Growth In The Coming Years

Reineke Reitsma

As many of you know, we at Forrester are true believers in mobile market research. Or to put it better, we believe that the rapid adoption and widespread use of mobile phones mean that research vendors have to develop survey software and design research methodologies that give respondents a great research experience, independent of the device on which they open the survey.

Both Roxie Strohmenger and I have been very vocal on this topic at conferences, in reports, and in previous blog posts. One of the drivers behind our crusade is that we see lots of evidence for the growing importance of mobile in other industries, like banking and retail.

Take, for example, M-Pesa — a mobile-phone-based money transfer service from Safaricom, Kenya’s largest mobile network operator; it transfers, on average, $320 million per month. It has been adopted by 9 million customers (corresponding to 40% of Kenya’s adult population) and processes more transactions domestically than Western Union does globally.

To show you just how rapidly mobile is changing people’s behaviours, I’d like to share a post written by my colleague Susan Huynh.

Susan is an analyst on Forrester’s ForecastView team and has looked into the uptake of mobile commerce. She predicts that about 40% of US mobile phone users will buy products or services on their phone by 2017, and total US mobile commerce will reap approximately $45 billion that same year — up from just over $11 billion today.

These numbers indicate how much consumers will rely on mobile in the near future and how it will influence their behavior. The research industry has to prepare for this change now.

I encourage you to read the post.

Mobile Commerce Is Positioned For Rapid Growth In The Coming Years
The rapid adoption of smartphones and mobile Internet usage is changing the way US consumers shop. Although still nascent, mobile commerce is poised for exponential growth. Mobile retail and travel spending grew by 80% in 2011 and is expected to more than double by the end of this year.

There are various definitions of mobile commerce that include retail, travel, advertising, proximity payments (coming soon), and app downloads, but Forrester combines retail and travel research with an understanding of mobile consumer habits to build its mobile commerce forecast. Shop.org and Forrester Research administer The State of Retailing Online survey annually to online retailers to understand key metrics in shopping trends; this year’s survey focused on mobile commerce and mobile retail execution. Having data from both the consumer and merchant perspectives provides us with a richer understanding of the mobile commerce platform and buying behaviour.

As the increase in mobile retail buyers is the main driver of mobile commerce spending growth, we sought to highlight the complexity within the buyer ecosystem when constructing the Forrester Research Mobile Commerce Forecast, 2012 to 2017 (US).  Daily internet users (a group highly correlated with smartphone ownership) and online retail buyers are much more likely to make mobile purchases than other consumers. The growth in these population segments is largely driven by mobile Internet tenure and increasing comfort with mobile Internet security. In fact, monthly mobile internet users are seven times more likely to make a mobile purchase, with the highest tendencies among daily users.

By 2017, mobile commerce is expected to quadruple. Travel is currently, and will continue to be, a significant portion of this total spend. Nonetheless, retail will be the fastest-growing category, reaping approximately $25 billion in 2017. Consumers will spend about half of this on media products, which currently dominate the retail landscape. Over time, apparel and consumer electronics spending will see rapid growth, but media products will continue to lead mobile retail spend.

Reineke Reitsma is VP & Research Director at Forrester Research.