Part C: E-commerce Research
M-commerce is the ability to perform “commercial transactions conducted electronically by mobile phone” (Google, 2014). This means that customers have the ability to:
- Transfer money between their accounts (Mobile money transfer)
- Receive tickets (Mobile ticketing)
- Receive vouchers and other promotions (Mobile vouchers
- Coupons and loyalty cards)
- Purchase movies, music and associated applications or software (Content purchase and delivery)
- Locate user and provide local promotions (Location-based services)
- Provide news and information (Information services)
- Browse internet (Mobile browsing)
- Purchase goods (Mobile purchasing)
- Receive targeting marketing and promotions (Mobile marketing and advertising)
All these services provide mobile customers the ability to control all of their transactions (commercial and private) from one device and from anywhere they receive network coverage.
Before M-commerce customers would have a limited number of options for completing transactions. Physical purchasing from a store, physical banking (deposit/withdrawal) or internet based transactions from desktop or laptop were the only available options before M-commerce. Customers did not have the ability to make transactions from any location because a desktop computer requires cables and a modem/router to have access to the internet. Laptop users still require a “Wifi” or wireless connection to access the internet which means that they are limited to certain locations (Wifi hotspots) for access unless the laptop has an internet stick which can be expensive and unreliable. M-commerce allows any smartphone user to have permanent internet access anywhere they are as long as they have topped up their phone with prepaid data (which can also be purchased and activated from the smartphone). Many companies/businesses, freelance and commercial developers are re-developing websites and applications specifically for mobile and smartphone use. This is making M-commerce even more efficient by making customer transactions easier and quicker to complete using smartphones.
M-commerce business application examples
ANZ Bank uses M-commerce to allow customers to:
- Check account balances
- Transfer money between accounts
- Pay bills or transfer money to other people
Figure 1 ANZ banking app
Google Play Store is Google’s store for purchasing applications and updates for android phones. Users can purchase items such as:
- Music and music players
- Applications and software
- Purchase gift cards
- Messaging and calling applications
The Google Play Store allows customers to purchase many different apps and services that increase the functionality and ability of the user’s smartphone.
Figure 2 Google Play Store
Business Model Changes
The increase in use of smartphone technology or M-commerce and the increase of customers controlling their daily transactions from a single private device has reduced the need for as many “walk-in” services or businesses. There is a large shift away from “bricks and mortar” businesses and warehouses as many businesses can outsource storage of their goods to specialist businesses and themselves focus solely on taking customer orders and improving B-2-C (Business to consumer) interactions.
This developing trend is also helping to reduce the cost of goods and services by reducing the number of physical transfers per product and by outsourcing the storage of goods to somewhere that is much cheaper. Customers are also able to complete an order solely online and have the product shipped directly to their house or workplace. Mobile purchasing is helping to reduce congestion by allowing customers to browse and purchase whenever and wherever they want without having to step foot inside a store and without being restricted to using a stationary computer or wireless internet hotspot.
Global Use of M-commerce
Worldwide M-commerce is becoming a major part of consumer interaction with businesses by providing customers the convenience of shopping at their own leisure and at any location. Customers can do their weekly grocery shopping, purchase clothing, purchase electronic equipment, pay weekly bills and check emails all from their personal smartphone. This is further pushing the increase in use of M-commerce and mobile technology.
“Global mobile commerce levels increased by 31% in the first quarter from a year ago, boosted by increasing tablet use and improved customer service. Mobile commerce now accounts for 17.4% of total online retail sales, up from 13.3% in the previous year. Overall ecommerce expense was up 20% in the quarter.”
Mobile Commerce (2014). Retrieved May 20 2014 from
“47% of consumers confirm they use their smartphone to search for local information such as a local store they want to visit. 46% of consumers look up prices on a store’s mobile site, and 42% check inventory prior to shopping in the store.”
Stats and Trends (2014). Retrieved May 20 2014 from http://www.rapidmarketplace.com/MCommerce/Stats-Trends
Acceptance of Mobile Banking (2014). Retrieved May 20 2014 from http://www.tnsglobal.com/sites/default/files/whitepaper/TNS_In_Focus_mobile_commerce_reaches_tipping_pointv2.pdf
“Global mobile device owners have embraced m-commerce and are comfy with the concept of mobile advertising. 60% of global mobile consumers use mobile devices as their primary or exclusive means of going online, and 83% of them say they will make a purchase on a mobile device in the next 12 months.”
M-commerce is saturating the Globe (2014). Retrieved May 20 2014 from http://www.internetretailer.com/2014/02/20/m-commerce-saturating-globe
NZ Use of M-commerce
NZ is a technology literate country and has developing trends similar to the rest of the globe in regards to the technology being used. M-commerce is becoming the new medium for consumers to go about their business. Consumers can purchase or pay almost any bill that they require using their smartphone or tablet and they can make these purchases from anywhere that they receive smartphone coverage.
“TV viewers will soon be able to watch their favourite TVNZ shows anywhere from the bedroom to the bus, as the state broadcaster expands its video-on-demand service to smartphones and tablets.
The On Demand service will also be available through Samsung Smart televisions by the end of the year.
TVNZ digital media general manager Tom Cotter said that the move reflected the way that New Zealanders’ habits were changing.”
TVNZ demands to go mobile (2014). Retrieved May 20 2014 from http://www.nzherald.co.nz/technology/news/article.cfm?c_id=5&objectid=10848172
NZ online sales trends domestically are declining as more products are being sourced and bought from international retailers.
Growth in online sales by retailer location (2014). Retrieved May 20 2014 from http://ecommerce.org.nz/2014/04/online-shopping-continues-to-grow-but/
“According to Nielsen’s s 2010 Online Retail Report 45 per cent of New Zealander’s are shopping online and are finding it easier to compare products and prices.”
“In 2013, 18 per cent of New Zealanders will access the Internet using a mobile phone. New Zealand had 110 per cent mobile penetration in 2008. According to IDC (International Data Corporation), mobile penetration will rise to 127 per cent over the next 5 years. The reason for that is the increasing use of smart phones, 3G enabled laptops and tablets, and USB mobile Internet connectors.”
M-commerce in Australia and New Zealand (2014). Retrieved May 20 2014 from http://mcommerce2011.wordpress.com/the-use-of-m-commerce-in-australia-and-new-zealand/
NZ vs Global
The NZ and Global M-commerce trends are very similar to each other and show that consumer use of mobile smartphone technology to perform more and more daily transactions and shopping are accurate.