M-commerce generated £3 billion worth of sales in the UK in December, representing 27.3% of the total £11 billion generated in online sales, according to the IMRG Capgemini e-Retail Sales Index. But Jumio claims “lost sales” due to a poor m-commerce experience were equivalent to over 50% of total m-commerce revenues.
Jumio, which is a next-generation credentials management company, believes that retailers missed out on over £1.5 billion in sales due to the prevalence of outdated mobile payment experiences.
“While consumers abandon mobile shopping carts for a variety of reasons, from slow network speeds to high shipping costs, the most significant among them is entirely under a retailer’s control – removing payment barriers,” said Daniel Mattes, founder and CEO, Jumio. “Checkout pages and payment methods have not kept pace with what smartphone devices and services can do today to streamline those processes. This cost the industry over a billion pounds this holiday season.”
With a bad experience affecting so many mobile users in December, could this have a negative impact on the sustained adoption of m-commerce across the UK? The IMRG data dispels any such claim. It reports that m-retail (as it refers to it) increased year-on-year by 138%. Alternatively, it could just mean that there were an additional 138% mobile users subject to a poor m-commerce experience.
A poll by Harris in 2013 revealed that 47% of shoppers abandon purchases on mobile devices due to payment friction, and 57% do not attempt the transaction at a later time on a computer, bringing Jumio to the conclusion that “over £1.5 billion was left on the table by retailers this holiday season in the form of lost sales”.
Perhaps, but there is no evidence to suggest that those mobile users that underwent a poor m-commerce experience did not make another m-commerce purchase elsewhere, in which case the UK m-commerce revenues for December were closer to £3 billion, than the potential £4.5 billion. After all, these people were highly likely shopping for Christmas presents and it’s also highly unlikely that Grandma or Auntie Nora didn’t get a present because of a very disgruntled m-commerce user.
“As mobile commerce sales increase each year, retailers need to offer a mobile checkout process that caters to on-the-go shoppers,” continued Mattes. “Increased security measures to protect consumers and merchants as well as more convenient payment options are essential in creating the seamless mobile experience necessary to drive purchases from the cart to the front door.”
In fact, one such solution could be on its way. Zapp, the self-proclaimed UK’s leading mobile payment innovation company, announced partnerships with five of the UK’s leading financial services brands. HSBC, first direct, Nationwide, Santander and Metro Bank will roll out Zapp mobile payments to their 18 million customers across the UK when Zapp is commercially launched in the autumn this year. Mobilesquared has spoken to Zapp and will post the story shortly.