After social commerce, mobile commerce is the most heavily debated topic-du-jour among retailers these days. One thing that both social and mobile commerce have in common is that they are both small. Teeny in fact. Forrester’s Mobile Commerce Forecast, 2011 To 2016, which launched today, shows that retailers can expect 2% of their online web sales (yes, I said web sales which means a minuscule percent of overall retail) to be transacted through mobile devices in 2011. While we also expect mobile commerce sales to grow 40% each year for the next five years, we’re still talking small numbers overall (7% of web sales penetration by 2016). Why so small you may ask. After all, aren’t smartphones changing the way we consume web content? Some things to consider:
Tablets. We don’t include tablet shopping in our definition of mobile shopping, but the creation (and subsequent explosion in sales) of this device is probably the single biggest inhibitor to the growth of “mobile commerce.” Data that we gathered with Bizrate Insights (to be released separately and soon) indicates that most tablet owners also own smartphones, and many of those people naturally prefer to shop on the device that has the larger screen when given the choice.
Shopping never leads web behavior. In any list of activities that people do on the Internet, shopping nearly always ranks below things like “reading news” or “using social networks.” Even those activities are not universal among the smartphone set, so it would be premature to expect that shopping would rank high on the list (which it, of course, doesn’t).
That’s amazing. How can I get a piece of that pie?
Call it what you will -- V-Tail, vCommerce, or just plain online video -- we are seeing some pretty bold claims around the use of video in eCommerce. Claims from platform vendors, press, and even some case studies and success stories from large retailers who are seeing some significant successes when they integrate video content into the online shopping experience.
But there’s the key. Integrate. Of course it isn’t as simple as sticking a few videos on your existing dot-com site and hey presto, conversion rates skyrocket. Video needs to support the sales process in a way that makes sense to your customers, that supports your brand values, and that enhances the shopping experience.
There are a growing number of ways to source video content, and an increasing number of players in the market who will all tell you that they have the answer. From user-generated content to automatically generated video. From content delivery networks to social media. There are a bewildering number of options out there.
Video absolutely can deliver firm benefits :
It can increase page views by driving traffic to your site.
It can enhance the time people spend lingering on your site, giving you more opportunity to market to them.
This morning eBay announced it has agreed to acquire Magento, the open source eCommerce platform that will be combined with other solutions to form a unit within eBay called X.Commerce. eBay already had acquired a minority stake in Magento in 2010, but after this latest transaction, it will own all of Magento. The folks down in San Jose have been busy this past year, paying approximately $2.4 billion for GSI -- which came with a controlling stake in Intershop -- as well as a raft of other mobile commerce solutions such as Milo and RedLaser. This announcement today means:
For Magento users, this is a very good thing. It is time for Magento to mature as a solution and as a business. The same development approach and business practices that can support a small insurgent open source commerce platform do not scale to supporting multiple products with very diverse needs and across many maturing clients. Users of Magento’s enterprise solution have been struggling with support and product traction as Magento invested in the MagentoGo SaaS solution and tried to manage a rodeo of new and existing partners, customer acquisition, and diverse product initiatives. In retrospect this was too much to take on at once, and Magento may have outgrown its ability to deliver on the expectations. With the completion of this acquisition eBay has the ability to clarify the product initiatives, add needed investment to product development, and mature the support given to developers, partners, and customers. A failure to do so will erode the Magento value proposition and see a raft of clients evaluating their long-term commerce capability solution providers and platforms. It will take time for the core challenges to resolve, so for Magento users struggling now this announcement will mean little in the short term. For Magento users in the longer term, this should be a positive.