The acquisition will add more than 300 products to L’Oreal’s lineup.
A financial software firm quietly acquired mPoria. But where’s customer support?
“They’ve not been answering their phones and not been responding to e-mails,” says Baxter Phillip, executive vice president at Phillip’s 1-800-Florals. “I have no idea what’s happened.”
Retailers and analysts agree that this is the worst-case scenario when dealing with a vendor. And this scenario has played out in the world of mobile commerce.
Phillip is talking about his former mobile commerce technology provider mPoria Inc., the vendor that once dominated the rapidly growing m-commerce field. And he is not alone: Of the 24 m-commerce sites last reported by mPoria, all 24 are inaccessible, reporting error messages not sites. Numerous retailers that had mPoria-built mobile sites contacted by Internet Retailer said the same thing: customer support completely disappeared so they dropped their m-commerce sites.
The death of 24 m-commerce sites brings the total number down 18% from 156 to 132. The total number of apps remains steady at 67 as mPoria did not build apps. The total number of retailers in m-commerce has dropped from 164 to 141 (one affected retailer that had an mPoria site continues to operate another mobile site built by another vendor).
Nirvaha, the firm that acquired mPoria, claims it continues to support mPoria clients and says it is unaware of any problems with the m-commerce sites of the company it now owns, even though some of the affected retailers say the lack of customer support goes back as far as a year.
“That’s news to me. That’s the first I heard of this,” says Tom Brubaker, chief operating officer of Nirvaha, who adds that Nirvaha bought mPoria to integrate the mPoria billing system into its flagship financial product to support its clients in e-commerce. He also says Nirvaha is “not actively trying to grow” the m-commerce business of mPoria and that the future for mobile is unclear. “There’s a lot on our plate right now,” he says, “so I cannot confirm strategy or a roadmap going forward at this time.”
M-commerce platform provider mPoria was present at the dawn of m-commerce. It specialized in taking retailers’ product data feeds and running them through a template that created a basic but fully transactional m-commerce site. The technology vendor attracted numerous retailer clients anxious to pioneer mobile shopping.
But the recent developments could have far-reaching effects in the world of m-commerce and beyond, experts say.
“Every retailer I’ve talked to is extremely nervous of partners they work with exactly for this reason,” says Sucharita Mulpuru, vice president and principal analyst at Forrester Research Inc. “This is going to be an enormous setback not just for other mobile vendors who will have an even higher hurdle to jump over to persuade others that they’re solvent but for software-as-a-service vendors overall.” MPoria delivered its technology via web connections to clients, in what is known as the software-as-a-service model.
Most of mPoria’s retailer clients were very small, though its client roster did reach into the Internet Retailer Top 500, including Moosejaw Mountaineering (No. 277) and Costume Craze LLC (No. 500).
“MPoria was perfect because they were the first, but it’s so easy today to create an iPhone site or app that gives you a user experience that when it comes to mPoria is no comparison,” says Jeffrey Wolfe, chief operating officer and chief financial officer at Moosejaw. “Our strategy was to use mPoria for the low-end flip-phones; it was never intended to be a smartphone solution. Today it’s all about the smarter phones, and that’s where our focus lies.”
Indeed, mPoria’s templated, basic sites rendered poorly on smartphones, which consumers are buying in large numbers. And mPoria sites were not able to include the rich features and functions provided by other m-commerce technology providers or created by retailers in-house.
With mPoria out of the picture, three major technology providers dominate the m-commerce market. All three build sites far richer than those of mPoria and all three have numerous big-name retailer clients.
M-commerce technology provider Usablenet Inc. boasts 38 retailer clients, including Sears Holdings Corp. (No. 8 in the Internet Retailer Top 500 Guide), American Eagle Outfitters Inc. (No. 51), FTD Group Inc. (No. 59) and Crate & Barrel (No. 60). Usablenet also has dozens of clients in the mobile travel market.
M-commerce technology provider Digby has 26 retailer clients, including The Home Depot Inc. (No. 39), 1-800-Flowers.com Inc. (No. 40), Drugstore.com Inc. (No. 46) and Abercrombie & Fitch Co. (No. 65). And e-commerce and m-commerce technology provider CardinalCommerce Corp. has 15 retailer clients in mobile, including Foot Locker Inc. (No. 52), Ritz Interactive Inc. (No. 146), SkyMall Inc. (No. 169) and DVD Empire (No. 266).
Other technology players that specialize in m-commerce and have multiple retailer clients include Unbound Commerce, Vortx and Moonshadow eCommerce Inc. And numerous e-commerce platform vendors have been adding m-commerce components to their offerings; these companies include Demandware Inc., GSI Commerce Inc. and MarketLive Inc.
In the end, retailers have learned a valuable lesson: Look as far down the road as possible when making plans in the rapidly evolving world of m-commerce, and make sure a technology provider has a business model flexible enough to bend and twist with ever-changing mobile technology.
“The mobile sites mPoria were pushing were designed for basic flip-phones to access and were not in any way good enough for the much smarter phones of today,” says David Byun, marketing manager at Accessory Geeks, a former mPoria client. “Today we’re in the middle of designing a powerful mobile site of our own that will provide a web experience smartphone users expect.”
And Phillip of Phillip’s 1-800-Florals? He’s staying in m-commerce, but proceeding cautiously. “We’re dealing with the situation by seeking out a new solution,” he says, “and going slowly based on this experience.”