Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
A technological sea change is occurring at this moment.
“We work mobile-first, we don’t even have to think about it anymore it’s so second nature,” Jean Sini, chief technology officer at flash-sale furniture and home decor e-retailer One Kings Lane, told me in July. “We think about a new feature and immediately the question is, is this something that can work on mobile.”
Any retailer that still wants its online business turning a profit five years from now better adopt that strategy, because consumers are quickly and permanently changing to mobile-first.
63% of U.S. adult mobile phone owners now use their phones to go online, double the percentage from 2009, according to August 2013 data from the Pew Research Center. Significantly, 34% of these consumers say they mostly access the web from their phones, Pew finds.
And that’s just smartphones. The other mobile device, the tablet, accounts for 8% of total U.S. web traffic, according to March 2013 data from Adobe.
Dig this: Worldwide PC shipments dropped 11% year over year in Q2 2013, Gartner Inc. finds. This marks the fifth consecutive quarter of declining shipments, which is the longest duration of decline in the PC market’s history, Gartner says. Meanwhile, tablet sales worldwide are growing at an annual rate of 25%, says Forrester Research, which also predicts that 60% of U.S. online consumers will own a tablet by 2017.
The proliferation of lower-priced tablets and their growing capability is accelerating the shift from PCs to tablets, says Carolina Milanesi, research vice president at Gartner.
“While there will be some individuals who retain both a personal PC and a tablet, most will be satisfied with the experience they get from a tablet as their main computing device,” Milanesi says.
So how is all of this affecting web retailing? Profoundly, that’s how. 48% of the time U.S. consumers spend with e-retail occurs on a mobile device: 34% on a smartphone and 14% on a tablet, according to March 2013 data from comScore Inc. It’s fair to say that in 2014, the predominant way consumers will spend time with e-retail is via mobile.
And that is why you, the retailer, need to adopt the mobile-first approach to web commerce. Like One Kings Lane, which to date this year is seeing 178% growth in mobile sales. The merchant offers an m-commerce site and earlier this year replaced its iPhone app with a universal Apple iOS app, which runs on iPhone, iPod Touch, iPad and iPad Mini devices, rendering the shopping interface to perfectly fit each device.
Retailers can take that path, creating sites specially optimized for smartphones and tablets and developing an app or two. Or they can choose to go with a responsive web design site, a single site based on a single set of web content and a single code base that renders to perfectly fit the size of a screen. And perhaps add an app to the mix.
And I haven’t even gotten into the next stage of mobile devices, wearable computers. Smartwatches are poised to take off. And there’s Google Glass, the eyewear computer. In fact, eBay already has a smartwatch app.
Mobile-first is inevitable. We’re smack in the middle of a technological sea change led by consumers hungry for mobile devices. The earlier retailers adopt the mobile-first approach, the quicker they’ll be able to better serve consumers where consumers like to shop. And as retailers innovate and create better and better mobile shopping experiences, and as mobile technology evolves (like the iPhone now offering biometric fingerprint scanning security, a boon for m-commerce), mobile conversion rates will jump.
“We’re not far from the point in time where half of our revenue comes from mobile,” says One Kings Lane’s Sini. “To say mobile is not a second-class citizen for us is such an understatement.”