Small businesses are often called the engine of our economy, but new research suggests this engine knows little about the new fuel that could help it run better.
Released on June 13, a new study conducted by payment enabler TransFirst and payment security provider ControlScan indicates that 82 percent of merchants aren’t sure whether purchases on their websites are made by consumers using a computer or mobile device. The study queried more than 1,600 small and mid-sized businesses over a one-month period, with three-quarters of the respondents claiming 10 or fewer employees.
While this may not seem like a big distinction to some observers, by not understanding how their customers are buying, SMBs can’t ensure they’re taking the right steps to encourage repeat customers and convert mobile leads into sales.
“The mobile payment survey findings show that small merchants have a real business need to effectively adapt to mobile technology trends,” Dave Abouchar, director of product management for ControlScan, said in a statement about the study findings. “Now is the time for ISOs and acquirers to embrace these trends with innovative offerings that guide their merchants toward business growth and increased revenue.”
In this PYMNTS.com Data Point, we’ll break down the study’s major findings so that SMBs can use this information to better adapt their services to this emerging medium.
Majority Of SMB Websites Aren’t Optimized For Mobile
Overall, the report’s findings underscore the lack of awareness among this demographic of the importance of mobile commerce. For example, nearly 50 percent of merchants told the researchers that their websites are not optimized for mobile devices, while 17 percent reported that they were unsure about the status of their mobile website.
The study also found that this gap existed even among merchants that defined themselves as “eCommerce only.” Less than half of these web-based SMBs – 46 percent – said they have mobile-optimized sites. Most surprising, perhaps, is that of the remaining 54 percent, only 7 percent are taking steps toward improving their mobile sites for buying.
SMBs Say Customers Aren’t Asking For Mobile
In seeking to understand why more SMBs are not aggressively pursuing mobile, the survey asked business owners why they hadn’t yet taken steps to invest in mobile. And most SMBs say it’s because of their customer base, with 43 percent of respondents saying their customers “were not asking for the service.”
SMBs also reported that they are not tracking online purchases, site visitors or shopping cart abandonment through this platform. This lead researchers to conclude that as many as two-thirds of all small merchants may be “putting up roadblocks” that are inhibiting mobile sales.
SMBs Aren’t Interested In Mobile Wallets
One positive finding was that there has been a growth in SMB awareness of how POS systems can bolster business and allow consumers increased payment options. Seventeen percent of surveyed merchants said they are now using tablets and smartphones to accept credit card payments: a figure that was up 7 percent from one year earlier.
Still, in spite of the increase, SMBs aren’t ready to begin accepting payments by mobile wallet. Only 3 percent of small merchants say they are currently taking consumer wallet payments, while 47 percent say they have no plans to do so. The leading reason SMBs say they are eschewing this technology is that they “have no compelling reason to make the investment,” a response given by 60 percent of survey takers.
For more insights, download a copy of the full report here.