From Kevin Duffey to COVID-19: Everything About M-Commerce

Context

As the world rapidly moves away from desktops and laptops toward tablets and smartphones, the importance of going mobile in various industries can’t be overstated. Online stores are now focusing on smartphone users more than ever, while mobile applications are on the rise, and for a good reason.

There are over 16 billion mobile devices worldwide, with almost 7 billion mobile phones. We use them constantly and for various reasons, from social media platforms through instant messaging to mobile banking, so improving the mobile experience is pivotal for commercial transactions.

Today, we will dive deeper into the world of mobile commerce, explore its history, examine its core elements, and discuss its future. Stay with us to learn about mobile commerce adoption, common types of mobile payments, online shopping platforms, and digital transactions.

A quick history lesson on mobile commerce

Although mobile banking apps and mobile-friendly websites are relatively new things in the online shopping industry, m-commerce has existed for over two and a half decades.

Kevin Duffey first mentioned the term in 1997 during a conference in London. Similarly, the first records of such payments also date back to 1997, when Coca-Cola introduced SMS payments for their vending machines in Helsinki, Finland.

Since then, our mobile devices have evolved from communication-focused gadgets into mighty and convenient machines capable of various uses and even financial transactions. Mobile commerce sales have slowly taken over the world, replacing physical stores with online transactions and contactless payments.

M-commerce vs. e-commerce

The last few years have been particularly rough for physical stores. Namely, businesses primarily based on physical location stores have slowly been dying out. At the same time, those with a hybrid model, meaning establishments with retail stores and e-commerce websites, have seen a tremendous increase in business.

Electronic commerce platforms, or e-commerce for short, are pivotal in surviving the movement to online business. These platforms are responsible for the death of mom-and-pop stores and a massive decrease in retail sales. Large corporations with such websites and based on e-commerce sales have slowly been making brick-and-mortar stores obsolete.

On the other hand, m-commerce is a form of e-commerce. However, where electronic commerce primarily occurs on desktop and laptop computers and from the comfort of one’s home, m-commerce focuses on mobile devices like smartphones and tablets, making websites, stores, and mobile payments available 24/7 and outside the house.

These two are similar as they both refer to online stores and purchases of goods, but distinguishing m-commerce from its predecessor is vital. Similarly, mobile commerce adoption doesn’t replace e-commerce.

It’s a necessary addition to the ecosystem that increases convenience, caters to mobile users, and makes commerce stores more available than ever.

Core aspects of m-commerce

The m-commerce ecosystem consists of a few vital aspects essential for its functioning. The improvements in these aspects can also lead to higher m-commerce use and much quicker m-commerce adoption. These aspects include the following:

1. Mobile websites and mobile-friendly apps

Before Android and iOS took off, websites were desktop-focused, and mobile apps were non-existent. However, once these mobile operating systems gained popularity, companies and developers started focusing on mobile applications instead of websites that were only convenient for computers.

Today, mobile-focused websites correctly display everything on a smartphone or tablet screen, while mobile apps are becoming incredibly optimized and fast.

E-commerce websites and online stores are no exception, as these companies have also adapted their services to mobile users, leading to much more convenience and a better shopping experience.

2. Mobile wallets

The invention of mobile wallets like PayPal, Venmo, and Cash App has significantly increased m-commerce use. Similarly, apps from large tech companies behind mobile operating systems, like Apple, Google, Samsung, Microsoft, and Facebook, had a massive impact on mobile commerce adoption.

Mobile payments like Apple, Samsung, and Facebook Pay, and mobile wallets like Google Wallet and PayPal limit the exposure of your personal and financial data and allow payments possible almost anywhere and at any time, making this transaction type vastly superior to credit and debit cards.

3. Banking applications and mobile transactions

Before moving to e-banking, our finances required going to your bank’s physical establishments and spending hours in line. However, e-banking changed everything, providing users with a website or a desktop app to manage their finances, including account balance checks, money transfers, bill payments, etc.

Mobile apps are the next step in this evolution, with m-banking making finance management a piece of cake. Having a mobile-focused app where you can do all of the abovementioned makes financial management even more convenient and adds a layer of transparency and control to your finances.

The boom of m-commerce sales during the COVID-19

The COVID-19 pandemic took over the world by storm. People began using their electronic devices more than ever, as many aspects of life revolved around desktops, laptops, tablets, and smartphones.

Consumers had to stay shut in, reducing contact with others and decreasing in-person sales. These developments also significantly hurt retail sales.

However, the COVID-19 pandemic was also a powerful catalyst in the rise of e-commerce websites, m-commerce applications, and various mobile payment apps. A significant increase in mobile purchases marked this era as m-commerce services gained popularity and stayed at an all-time high even after the pandemic passed.

Various COVID-19 pandemic factors influenced and sped up mobile commerce adoption. Being legally required to stay home meant that offices closed and people moved to online platforms.

Brick-and-mortar establishments significantly decreased numbers, m-commerce trends skyrocketed, and app commerce increased by a massive margin.

What does the future of m-commerce look like?

If our technology continues at the pace it’s currently evolving, m-commerce services are going to become much better than they are. The future looks incredibly promising, and we will see the mobile shopping experience reach new heights because of the following few aspects of mobile commerce transactions.

1. Voice searches

Convenience is one of the primary advantages of mobile shopping, with mobile platforms creating a fast and seamless experience and improving m-commerce services.

One-click checkouts are already here as mobile customers can save payment details on their cell phones, like credit or debit cards, and tap a fingerprint sensor to confirm their identities and initiate a payment.

However, one-click ordering is still in development. It will continue to use voice searches to make mobile shopping apps even faster and reduce the amount of user input needed. M-commerce adoption and customer retention on mobile commerce applications will likely increase further.

Smart speakers are an excellent example of the convenience of voice searches. Amazon Alexa is the first choice for many users looking to simplify their purchases and create a hands-free shopping experience.

Although they’re already in a massive lead, m-commerce services will improve. Voice shopping will bring even more convenience for app payments, and online shoppers will only need a few taps to complete m-commerce transactions.

2. Location-based services

Powerful shopping algorithms are already doing great when showing ads to the target audience, but location tracking can take this to the next level. In essence, location tracking can improve targeted ads and present you with products and services based on your current location.

For example, if you were at an airport, you might see ads for books you can read on a flight. Alternatively, your phone could guide you to the nearest airport shop that sells headphones or earbuds so that you can listen to music on your flight.

Retail stores might also be echoing their promotions or products in general, which smartphones can pick up and show you when you’re near that store. However, instead of showing everyone everything, AI and ML can help target the right consumer, bringing us to the following topic.

3. Artificial intelligence and machine learning

Although one-click ordering, quick checkout process, and near-instant monetary transactions are pivotal in adopting m-commerce services, AI and ML will likely play an even more significant role in creating a personalized shopping experience. Algorithms that target customers with tailored ads will become even better with the help of AI and ML.

These two will also bring various security measures to e-commerce websites and significantly reduce the security concerns for m-commerce services. For example, machine learning can analyze the behavior and transactions of internet users and increase the prevention of fraudulent activities.

The user experience will also improve as customers get what and when they want it. Any possible issues will also quickly be resolved by adopting AI in customer service, leading to far better chatbots and a happy customer base.

Mobile shoppers will be much safer and targeted with custom-tailored content, leading to a better customer experience and more potential customers for a business owner who implements these technologies on the mobile commerce app.

Conclusion

As the world moves away from desktop devices and the number of active users of wireless devices increases, mobile applications with credit card, payment, and wallet capabilities gain even more popularity.

From humble beginnings, with Kevin Duffey first mentioning it and SMS payments in 1997, m-commerce use has significantly increased in the past few years, with various COVID-19 pandemic factors playing a pivotal role in m-commerce adoption.

These mobile commerce services have reshaped how we purchase products and services online, focusing primarily on smartphones and wireless technology instead of desktops and a home internet connection.

As a result, mobile websites are slowly replacing desktop-focused ones, and mobile shoppers are slowly outpacing computer-based ones, which is why mobile device payments like Android Pay are also reaching all-time highs.

With mobile commerce trends slowly introducing voice searches, location services, and AI, m-commerce adoption can only rise and improve, leading to more transactions and a better personalized experience.

Frequently asked questions