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Mobile shoppers are naughty and nice
23% of e-retail transactions on Thanksgiving and Black Friday came from mobile devices.
It’s been a strong mobile holiday season so far for eBay Inc.On Thanksgiving, the online marketplace says it tracked a 91% year-over-year increase in the number of transactions through PayPal on mobile devices; on Black Friday, 99.2%. PayPal is owned by eBay.
Though good news for e-commerce operators, the growth in mobile commerce—mobile sales were up 80% year over year on Cyber Monday alone, according to Adobe Systems Inc.—perhaps merits a word of caution, to which Santa Claus can attest: Like all free-willed consumers, mobile shoppers can be naughty or nice. More importantly, their ability to bring smartphones or tablets into a store opens its own set of troubles for retailers.
In October and November of this year, 15.5% of retailers report that they’ve encountered shoppers making fraudulent returns using an electronic receipt, according to a survey of 62 retail executives conducted by the National Retail Federation. That’s a slight decrease from 19.3% who said they witnessed such fraud in the same period last year, but it appears in line with a decrease in the number of retailers who say they accept returns of online orders in stores. This year, 82.5% of retailers say they accept such returns, compared with 86% who did so last year, the NRF says.
“Recent efforts to combat fraudulent activity are slowly starting to work, but criminals are becoming more savvy and technologically advanced in their methods, making it even more difficult for retailers and law enforcement to keep up with the growing problem,” says Rich Mellor, the trade group’s vice president of fraud loss prevention
Besides using smartphones to show illegitimate e-receipts in stores, criminals this holiday season also frequently use virtual private networks, pipelines for securing the transmission of online data, to trick an e-commerce site into thinking their mobile web browsers are coming from another, legitimate IP address, says Alistair Faulkner, chief products officer at ThreatMetrix. They are also using “jailbroken” mobile devices—that is, devices with operating systems that have been hacked—to mask the identity of those devices in order to bypass security screens, he says. “Retailers accepting mobile transactions must have layered, preventative measures in place to differentiate between authentic and fraudulent transactions and protect against cybercrime,” Faulkner says.
As reports of booming online commerce continue coming in this holiday season, one e-commerce platform provider presents a more modest view of its clients’ sales growth. ShopVisible, which counts 70 e-retailer clients, including two in the Top 500 Guide and four in the Second 500, says web site traffic among its clients was down year over year in November, with average weekly visits around 130,000 to 150,000 last month versus about 135,000 to 250,000 per week in November 2012.
Those retailers also experienced a 14.2% decrease in average order values last month, to $121 from $141 last year, ShopVisible says, while conversion rates remained flat. On Thanksgiving, however, those retailers’ sales increased year over year by 10%, the vendor says. That preceded a slight, 3% dip in year-over-year sales the next day, Black Friday.
ShopVisible is reporting ongoing holiday shopping metrics weekly on Tuesdays in its Dashing Through The Data web site. The vendor speculates that one reason its clients’ sales have been tracking lower than those reported by other e-commerce technology providers may be the shift in Thanksgiving to Nov. 28 this year from Nov. 22 in 2012. As a result, November 2012 included several big post-Thanksgiving shopping days, including Cyber Monday, which this year fell in December.
Still, ShopVisible’s clients have not missed the mobile wave. In November, smartphone traffic accounted for 20% of their total web site traffic, up from 13% last year. Tablets also grew to 19% of total traffic, up from 13% last year. Those increases have come with a corresponding decline in desktop traffic, which this November made up just 61% of ShopVisible clients’ total web site traffic, compared with 74% last year, the company says.
Whatever metrics they’ve tracked so far, retailers can anticipate more big holiday shopping days, and some are promoting online deals to keep sales coming.
Walmart.com, for instance, is planning a follow-up to the booming Black Friday and Cyber Monday it had last week–though the retailer declines to give specific figures, Walmart.com US president and CEO Joel Anderson says Cyber Monday was an “all-time record sales day,” thanks to momentum that began on Thanksgiving and carried through the holiday weekend. The chain plans another online shopping bonanza for Monday, Dec. 9, which is also known as “Green Monday,” so-called because in some years the second Monday of December has been the busiest shopping day of the holiday season. On Monday, Walmart.com says it will bring back five of its top-selling items from Black Friday—all consumer electronics except for one Lego building set—in addition to other specials. The Green Monday deals will be available early, on Sunday afternoon, to Walmart.com’s e-mail, Facebook and mobile customers, the retailer says.