July 27, 2010, 3:24 PM

It's a Hot Summer for Mobile Commerce

Blistering sales of smartphones foreshadow mobile commerce growth

Overlooked in the hullabaloo over Apple’s well-publicized antennae “flaw” with its new iPhone 4 were these stunning numbers: From the day iPhone 4G went sale on June 24 to July 16, when Steve Jobs attacked the issue in a hastily called press conference, Apple sold 3 million units of the new phone. That’s nearly 6,000 phones every hour of the day. Sales would have been even greater where there enough of the phones to meet demand. If you want an iPhone 4, don’t expect to get one without spending a week or two on a wait list.

No other consumer device has had such a profound impact on our lives in such a short period after its introduction than the iPhone and other web-enabled phones. Not television, or radio, or the automobile. Mr. Jobs was noticeably annoyed by the antennae issue, which he believed was “blown so far out of proportion” by the press. That this problem, easily remedied by a cheap “bumper,” could overshadow even temporarily the cultural and economic impact of this revolutionary device is a testament to our capacity for myoptic thinking.

When it comes to smartphones—and the mobile commerce activity they are suddenly generating—such nearsightedness can be the death knell for any e-retailer. There are now more than 60 million smartphone users in the U.S., more than double the number just one year ago. In the fourth quarter of 2009, smartphones accounted for just 21% of America’s mobile phone user base according to Nielsen.  By Q1 of this year, the smartphone share had jumped to 29%, and Nielsen estimates that by the third quarter of next year, smartphones will constitute 51% of all mobile phones in the U.S.

Not surprisingly consumers are accessing more web sites with their new smart devices. Currently, says Nielsen, the average smartphone user receives 300 MG of data a month on their handhelds, more than three times the data  they consumed on average a year ago. A growing share of that data consumption is from accessing m-commerce web sites. On average each month from February through April 2010, 7.3 million smartphone users accessed m-commerce sites, reports comScore, up 46% from the same period a year earlier.  During the same period this year, says comScore, 2.7 million smartphone users accessed mobile commerce apps, up 93% from last year. And just last week, we reported that Amazon generated more than $1 billion in mobile commerce sales in that last 12 months.

Given these numbers, we conclude that e-retailers can have no higher priority than to learn more about their m-commerce challenge and opportunity, and we are responding to the need. In the last year, Internet Retailer’s magazine, web site and newsletters had been reporting on the accelerating pace of m-commerce initiatives. Soon we will launch a micro site and a new e-mail newsletter that will be devoted to covering all m-commerce news. In two months, we will publish our first Mobile Commerce Databook, documenting trends in m-commerce sales and smartphone usage, identifying and ranking leaders of the m-commerce market, and describing all the resources available for e-retailers looking to add m-commerce sites.

And on October 12 & 13 in Chicago, we will hold the first annual Mobile Commerce Forum, a conference featuring 29 expert speakers with real-world experience with successful mobile commerce sites. They come from leading m-commerce operators, including Walgreens, Ticketmaster, and Fandango, and will explain how to develop, operate and market winning mobile commerce sites. They’ll also explain why the time to develop these sites is now—not in a year or two. But if you ponder the numbers on this page, you’ll get the picture.


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