Mobile is one of the fastest-growing retail sectors at the moment and still projects to grow for years to come, but the technology is still not where most retailers want it.
Currently, smartphone users make up about 64 percent of the U.S. population, but that number is expected to grow to 72.2 percent by 2020, according to Astound Commerce’s 2016 Mobile Research Report. U.S. mobile commerce sales are rising “significantly” compared to overall eCommerce, according to Astound Commerce’s study.
Mobile commerce sales are forecasted to reach 33 percent of all eCommerce sales in 2016, up from 26 percent the previous year — 2.7 percent of all retail sales for the year. That’s an estimated $130.92 billion in mobile sales this year. But that number is expected to double to 5.4 percent and 43 percent of all eCommerce and all retail transactions, respectively, by 2020 for an estimated $294.22 billion.
“The important factor to keep in mind is that they are now representing almost half of retail eCommerce’s penetration, which is impressive for a channel still in its infancy,” according to Astound Commerce’s report.
Mobile commerce is also the fastest-growing retail sector at the moment, showing 40 percent growth over 2015 levels, compared to 11 percent for eCommerce overall and only 4 percent growth for retail overall (fueled mostly by eCommerce growth, which is being fueled mostly by mobile).
“In 2015, mobile had great momentum. Given its emerging strength, rather than viewing mobile today as a growth opportunity, we are confident that mobile has moved into a position of strength and is accelerating into the fast lane,” according to Astound Commerce’s report.
But, despite mobile’s rapid growth, many retailers still feel as though the technology is not where they would like it or need it to be.
But a new survey from Boston Retail Partners that polled 500 retail executives in North America found that mobile technology and its retail applications are still not where most retailers would like it to be.
Of those surveyed, 58 percent of companies said they had implemented some form of a mobile-specific website, but about half of those companies that had mobile sites — 27 percent — believe their current mobile site needs improvement, compared to 31 percent of retailers who said their mobile site was working well for consumers.
Twenty-five percent of those surveyed said they planned to implement their mobile site within the next two years.
When it came to mobile apps, the numbers were even worse, with only 12 percent of retailers surveyed stating they were satisfied with their current mobile app. Twenty-four percent said it needs improvement, while another 47 percent still hadn’t implemented it yet and said they planned to do so over the next several years.
“When it comes to implementing newer mobile capabilities, according to the data, many retailers don’t seem to be there yet,” according to an eMarketer report on Boston Retail Partners’ survey. “Roughly a quarter of the executives polled said that executing geolocation and in-store customer ID technologies would likely happen in the next three to five years. Conversely, at the time of the survey, only 2 percent said they had geolocation in place that’s working well. Meanwhile, no one felt they were at that stage of success with customer identifying tools.”
Of those companies surveyed, more than half said the biggest hurdle to implementing a successful mobile strategy was the integration of the strategy itself, followed by united marketing and IT departments, followed by a lack of the staff needed to implement the strategies.
And as foot traffic at brick-and-mortar stores continues to decline, solving the mobile dilemma will continue to be of paramount importance to retailers. In August alone, RetailNext measured a 9.9 percent drop in foot traffic compared to the previous August; in July, foot traffic was down 5.8 percent, but total sales at brick-and-mortar locations were down 7.1 percent.
“While there’s much improvement needed for retailers to get to a good place with select mobile technologies, it appears that the marketers understand it’s critical,” according to eMarketer. “Mobile, in particular, is likely the inroad for retailers wanting to close the gap on eCommerce and brick-and-mortar sales and get a handle on floundering foot traffic.”