Mobile accounted for 25% of Ulta's e-commerce revenue during Q2.
If there's something you've bought offline that you weren't able to buy online, we're probably thinking about that.”
Mobile accounted for 25% of Ulta's e-commerce revenue during Q2.
In Evine's second quarter the web grew 9%, but mobile sales grew nearly five times faster. Total sales rose 3%.
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Most retailers that have identified mobile commerce as a strategic priority are today focused on building an m-commerce site or maintaining and learning from a site they’ve built in the past year or two. Some retailers, however, are taking things up a notch: They’re not designing m-commerce sites, they’re already redesigning sites. And in the process they’re adding the latest technologies, like two-dimensional bar code scanning, to their efforts.
The Catholic Company launched its m-commerce site in March 2010. A lot has changed in the mobile realm since then, especially smartphone capabilities and mobile web browser functionality. The religious goods merchant came to appreciate the evolution of mobile technology and what it meant to its m-commerce site and decided it had to upgrade the site to keep pace with the times.
“Last year mobile was doing really well, but this year it has slowed a bit, and we attributed that to a design matter,” says Nicholas Cole, director of marketing at The Catholic Company.
When it designed the site in early 2010, all smartphone web browsers only operated in portrait mode, which means the display is longer vertically than horizontally. Unlike with many smartphone apps, the browser would not change the web page onscreen to landscape mode when the user turned her smartphone to a horizontal position. That changed last year, and now most smartphones can browse the web in landscape mode, which significantly alters the size of text and images on the screen.
“In landscape view, the way our site was designed the text became very small and very hard to read, so we felt people were getting a bad experience. That experience was translating into weak sales,” Cole explains. “So we updated the style sheets to function better in landscape, as well as with higher-resolution screens that have been entering the market. Now fonts and images in landscape mode appear bigger in a better fashion.”
One of the biggest changes in mobile commerce has been in the market itself: more retailers, catalogers and consumer brand manufacturers are reaping rewards. M-commerce sales hit $2.9 billion in 2010 and are expected to jump to $5.3 billion this year, according to investment bank Barclays Capital. Merchants realize that more consumers are buying smartphones and using them to access the web, engage with mobile apps. More shopping inevitably will follow.
“Mobile commerce is a must-have,” says Julie A. Ask, vice president and principal analyst at Forrester Research Inc. “The number of people using their phones to do research and make purchases has grown dramatically in the last year. M-commerce sales are in the billions, and the dollars that mobile will influence will be three times that or more. I don’t see how you stay out of that game.”
Cole stresses the urgent need for merchants to get into m-commerce. It’s growing fast at The Catholic Company—mobile sales are ahead of target for the year to date.
“Last year was the time to get started,” he says. “People are waiting for trends to emerge, but things are moving so quickly. Retailers need to get a fully functional m-commerce site up as quickly as they can. Traffic no doubt is coming from mobile devices and these people expect a mobile-optimized site, so you’ve got to give it to them.”
Most retailers begin in m-commerce with a site. A site can be accessed on any smartphone and on many feature phones—the predecessors to smartphones. Thus, sites provide the greatest reach. But then there are mobile apps, which can provide much richer experiences than sites and make full use of the innate features and functions of a smartphone. But an app only provides access to a slice of the pie; for example, an iPhone app can only be used by iPhone users, not all smartphone users.
But smartphone users love apps. And when done well, which includes offering some cool and crafty features, apps can keep consumers coming back for more.
“If I’m targeting people over 55, mobile will be less relevant. If I’m targeting 13 and 14, they will have a lower-end device not capable of downloading apps,” Forrester Research’s Ask explains. “But for the very lucrative Gen Y and Gen X, and even into the Boomers, an app is a better experience than the web. The apps are the ones that do all the cool things. They scan bar codes, they scan QR codes, they let me bump my phone with my friend’s phone and give them money. That’s the fun stuff that consumers get excited about.”
However, some mobile experts suggest while a mobile app may be good for some retailers, others need not devote the time and resources necessary to create one.
“If you’re a big enough brand it can make sense, but it’s not like you have to do it,” says Neil Strother, practice director at ABI Research. “If you decide to do it, you should also simultaneously have a really good mobile web site experience. If you do one thing you should do an optimized web site. A mobile app is not a simple thing. It’s a lot more expensive in people and dollars than you think.”
In addition to sites and apps, retailers should consider another m-commerce tool: text messaging. Text messaging is an inexpensive way to reach consumers with any kind of mobile phone in a way that is immediate and time-sensitive.
“Text messaging is a really good way to say, ‘I have a new sale this week’ or ‘Come in for this discount.’ It’s a good way to stimulate your mobile consumers,” Strother says. “You have to do the heavy lifting of capturing the mobile phone numbers.” That’s required in order for a retailer to text customers.
“But it can be very successful, Cole adds. “The open rate for text alerts is extremely high; if you can get enough phone numbers and set them up on text alerts, it can be very effective, but you need to send a limited number out and ensure they are relevant.”
Also worth considering is a mobile technology that has started to gain traction in the last year: two-dimensional bar codes, such as Quick Response, or QR codes. 2-D bar codes can contain much more information than the conventional one-dimensional bar code used on consumer packaged goods. A smartphone user with a 2-D reader app hovers his smartphone over the 2-D code and the reader scans it; the app reads the cost and automatically links him to mobile web-based content.
The Catholic Company is pioneering QR codes by including them in its July catalog. Scanning the code with the St. Roch statue will send shoppers to a mobile video of the artisan handcrafting the statues plus more information on the patron saint of animals.
“Our goal is to raise awareness of and drive more traffic to the mobile site,” Cole says. “The video is hosted on the mobile site, and on that video page there is a link to the product page. The site search box is also on the video page, and shoppers will be able to navigate from that video page throughout the site.”
M-commerce offers many tools to reach the ever-growing number of mobile shoppers. Merchants must consider diving in with an m-commerce site, then examine other avenues that may lead to greater engagement with their brands and more sales.