Investing in Mobile Commerce is a Growth Play? Really?

June 22nd, 2011
by David Gould

Some of you may know that I am the CEO of a Boulder-based company called mShopper.  mShopper offers a terrific, Saas mobile commerce platform.  I mention this to substantiate my creds only (this is not a plug).   In my capacity as CEO of mShopper, I can truly report from the very front lines of mobile commerce.  It is an exciting vantage point for sure.  Indeed, I recently concluded  a six-week long study of mobile commerce traffic patterns, the findings of which are very surprising.  The mobile commerce sector has experienced explosive growth over the last 18 months, powered by surging Smartphone sales and (reasonably) robust 3G networks.  One prevailing position amongst mCommerce vendors and retailers has been that an investment in mobile commerce was predominantly an investment in customer retention – placating existing customers who are, for the most part, increasingly visiting their favorite sites from their Smartphones. Our findings strongly suggest that the opposite is true; a significant majority of mStore traffic comes from organic mobile search! This has many important implications. Before I describe our study in detail, let me summarize our study’s findings for all those time-stressed readers out there:

  • Investing in a mobile optimized site is an investment in customer acquisition. Investing in mobile commerce is, to a lesser extent, an investment in customer retention.
  • There is a far greater sense of urgency on the part of retailers to quickly launch a mobile-optimized site than has previously been acknowledged. The “customer acquisition” window of opportunity will surely decrease quickly ovcr the next 18 months.
  • Correctly implementing an mStore is crucial. Poor deployment can dramatically reduce or eliminate the customer acquisition and growth benefits

Study Methodology
mShopper gathered and analyzed traffic patterns from seven clients over a time period that spanned from April 1, 2011 through May 15, 2011.  The clients included in the study ranged in size from 1.5 million visits per month to just over 20,000.  Product categories included a broad spectrum of all the most popular categories (we have refrained from including specific categories as such data could compromise the identity of the individual clients).  Data was gathered and parsed using Google® Analytics; every page of every mShopper client’s mStores is tracked with our analytics code.  We then compared overall visits to a client’s mStore into individual components including direct referrals from a client’s website’s home page versus traffic that was redirected directly from a product, brand, or category page.

Study Findings
The actual findings from our study are as follows:

Finding 1: A significant majority of mStore traffic comes from organic mobile search.
This was a very surprising result indeed.  While mShopper always knew that mobile shoppers are very ‘use case’ driven i.e. there is a specific reason why shoppers would take the time to visit a particular merchant’s mStore on a SmartPhone,  we had always assumed that launching a mobile site was more of a retention play; that an mStore was addressing existing customers who had such specific needs… In fact the opposite
is true.  Row I above shows the percent of mobile traffic that came to our clients’ sites as a result of an organic product, brand or product category search. With the exception of Merchant 1 (we will explain this later), the percent of mobile traffic visiting our clients’ sites who originated from an organic search ranged from a low of 66.1% to a high of 92.8%!  On average, 78.7% of our clients’ mobile traffic came from search! There are some other very interesting findings above.  Row F calculates our estimate of ‘natural, organic’ mobile traffic currently visiting our clients’ sites stated as a percent of overall traffic to those sites. Smartphone traffic to our clients’ E-Commerce sites ranges from a low of 0.43% to a high of 3.9%.  The weighted average is 1.8%.  Row G on the other hand calculates the incremental mobile search-originated traffic as a percent of existing eCommerce site traffic.  Think of this as new (mobile) eyeballs as a percent of existing overall traffic to an eCommerce site.  With the exception of Merchant 1 again, this number ranged from a low of 1.1% to a high of 9.9%!  Mobile search is generating a lot of new traffic!

Finding 2: Investing in a mobile optimized site is an investment in customer acquisition.
This is an obvious conclusion from Finding 1 above. While there are important retention benefits from launching a mobile optimized site, the truth is that retailers can expect, on average that nearly 80% of the inbound traffic to their mobile site will come from specific organic search queries.  We further conclude that any sales resulting from such traffic will, in all probability, come from a new customer.  We draw this conclusing based on simple math.  In the last month, well over one million people searched on the brand ‘Peg Perego’.  The likelihood that one of these random one million queries then went on to buy a Peg Perego stroller from a merchant with under 50,000 visits seems incredibly low. Beyond this, we actually noticed that the percent of people who make purchases through our clients’ websites and then identify themselves as “new customers”during the checkout process is even higher than the 78.7% percent of people who came to the site via mobile search! More interesting still is that of the merchants above, Merchant 2 actually has the second highest overall conversion rate through their mStore.  This is surprising because they have the lowest natural mobile traffic percentage currently visiting their site. This bit of data suggests that mobile search-originated traffic is more likely to convert than existing customer traffic. More data is needed to corroborate this premise, but intuitively it makes sense as search-originated traffic is use-case driven.

Finding 3:  There is a far greater sense of urgency on the part of retailers to quickly launch a mobile-optimized site than has previously been acknowledged.
The customer acquisition” mobile window of opportunity described in Finding 2 above will surely decrease in inverse proportion to the number retailers who have launched a mobile-optimized site.  If as described above, search originated traffic is highly unlikely to be an existing customer of a mobile site that benefits from their incremental traffic, this likelihood diminishes as more mobile sites come online.  It is also further unlikely that any individual ‘searcher’ will redirect to a particular site as more competitors come online.

Finding 4: Correctly implementing an mStore is crucial.
So what happened to Merchant 1? Why is their data so different?  Merchant 1 is, in fact the largest merchant in our group.  The monthly traffic to their E-Commerce site is 15X that of Merchant 2 (the next largest merchant in our study).  We would have expected that their mobile mStore traffic would have been roughly 15X Merchant 2’s mobile traffic; in fact, it is only 6X.  Further, only 25.9% of Merchant 1’s mobile traffic originated from an external search compared with 78.7% for the remainder of the group. What happened? We too were prplexed by this, and the answer is technological in nature.  mShopper deploys an intelligent bit of JavaScript that automatically ‘sniffs’ all inbound traffic to our clients’ websites and then re-routes mobile traffic to their mobile-optimized mStore.  Our code is further able to identify whether a visit is,  in fact, coming directly from the home page of our clients’ sites (and thus should be redirected to the home page of their mStore), or from an external product, brand, or product category search (and thus should be redirected to the appropriate product, brand, or product category in the same mStore).  Correct deployment of this code requires that the code be embedded on each page in our
clients’ websites.  After a lot of forensic work on our part, we found out that Merchant 1 had, in fact, only deployed this code on the home page of their site.  This very poor decision resulted in this merchant losing the vast majority of all the external, search-originated traffic, which in turn, would represent a majority of the traffic to their mStore!  Further still, Merchant 1’s conversion rate is roughly half that of Merchant 2, which further reinforces the premise that external search originated traffic is more likely to convert than natural, site-generated traffic.

What do you all think?  Please send me your comments!

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11% of Internet Traffic Comes from IPhones, Androids and Other Mobile Devices?

January 31st, 2011
by David Gould

This is the data published by Percent Mobile, in June 2010.  My own company’s site analytics roughly corroborates these data; 9% of our site’s traffic comes from a mobile device.  Percent Mobile also alleges that global mobile traffic had grown 32% during the 6 months prior to their release (here is a link to the Percent Mobile site report)

In fact, it seems to me that the accuracy or precision of the Percent Mobile report is not terribly relevant.  The trend towards rapidly increasing levels of mobile traffic is a given.  Indeed, according to Mary Meeker, the ex-head of Morgan Stanley’s Technology Research desk (and now a partner with Kleiner Perkins), a majority of  Internet traffic will originate from mobile devices sometime in 2013.  In two years or so, more than half of all global internet  traffic will come from a mobile device!   Copied below is a slide from Ms. Meeker’s presentation in which she pushed this prognostication onto the world. 

So, what are the implications for online retailers?  This is a profound question.  I  recently wrote and published a white paper entitled:    “The Mobile Explosion – mShopper Whitepaper on M-commerce – Jan 2011”.  The paper discusses this very issue in some detail.  It is quantitative, based on real data, and presents a strong case on why retailers must go mobile ASAP.   Better still it offers the 7 tips to help retailers flourish in the new mobile commerce world!  Click here to download this white paper.  The white paper is free with no strings attached.  That said, I would surely love to hear your comments and feedback!

Posted in Android, E Commerce, IPhone, M Commerce, mobile commerce, Mobile Marketing | Comments (0)

Crazy Stuff From The Front Lines of Mobile Commerce

November 16th, 2010
by David Gould

Hi everyone,

Please forgive me!  I know it has been some time since I last posted.  Spank me!  But, I think the wait will have been well worth it!  I have truly been hard at work on the front lines of mobile commerce!

For those who do not know much about me, I am the CEO and founder of mShopper, a Boulder-based, mobile commerce solution provider.  mShopper has developed a really terrific, self-service, SaaS, turnkey, mobile commerce and marketing solution that makes it really easy for any merchant, small, medium or large, to launch a profitable mobile commerce solution that works on every smartphone, out-of-the-box, with no IT or budget needed. Check it out.  It’s way cool!  Love to hear your comments…

That being said, this blog is NOT about mShopper.  I offer the above for two reasons only:  The first is a semi-lame excuse for why I have been so silent for the last few months.  We have been busy little bees in Boulder.  We just launched the commercial version of our Mobile Commerce Platform on September 16th.  We are projecting that we will have 20 -30 paying clients before the end of the month!   The second is that I want to enhance my street cred with you all.  I am fully immersed on the front lines of mobile commerce as much as anyone out there (and have been for quite a few years)!

Here is my promise going forward:

  1. I will be blogging quite often now.  There are soooo many things to talk about….
  2. Expect high level discussions about what is going on generally in mobile commerce
  3. Expect detailed discussions about how to succeed in mobile commerce
  4. Expect honest information about what works, what does not work, and even statistics that will help Techies, Marketers, C-levels, Entrepreneurs, Investors, and others

So here is my first little morsel:  Mobile Commerce is Here in a BIG WAY!!  Rhetorical question to my readers:  Do any of you know what percent of global Internet traffic originates from mobile devices?  I recently had the honor of addressing a large audience of  “New Techies” (350+) here in Boulder, CO.  Not one person came close to the correct answer.  In June, 2010, 11% of all global Internet traffic originated from a mobile device! (don’t believe me, click here).

This fact alone has profound implications for all you e-tailers out there.  First, check your traffic analytics.  You will find that a sizeable percentage of your current website traffic is originating from mobile devices.  The number will vary depending on the demographics of your audience, but it will range from 3% to 15%!  Next, check your conversion rates for your mobile audience, compared with your overall conversion rates.   You will be shocked…If you are like most retailers, your mobile conversion rate will be a small fraction of your average, overall conversion rate.  Many of our clients have mobile conversion rates that are 1/10th their overall conversion rates.  A good mStore will change that…

I created a little spreadsheet you can use to calculate the opportunity cost of  not having an mStore right now.  The spreadsheet highlights a typical smaller merchant with 100K monthly visits 10% of which originates from a mobile device, an assumed conversion delta of 1.7% (the difference between the overall conversion and the mobile conversion), and an average order size of $100.  Believe it or not, this merchant is leaving $17K per month on the table because they have not yet launched a mobile site.  That’s $204,000 per year!

Oh, and here are a couple of additional little morsels to masticate:

  1. Mobile internet traffic grew 32% during the first 6 months of the year
  2. Mary Meeker, the (in)famous Morgan Stanley Internet Analyst is predicting that mobile-originated web traffic will exceed desktop/laptop Internet traffic by 2014

So, the issues for retailers are not “Should I go mobile now?” or “Can I afford to go mobile?” The issues are “Can I afford NOT to go mobile now?” and “How do I go mobile?” I’ll talk about all this in my next posting.  And it won’t be 3 months from now.  I promise.

Posted in E Commerce, mobile commerce | Comments (0)

Hi Everyone: I wanted to share a very fun announcement from my company, mShopper!

August 27th, 2010
by David Gould

mShopper is a Boulder, CO technology start-up that developed an easy, fast, and amazingly affordable way to help any retailer sell products on all mobile phones. We’re gearing up for our commercial launch after Labor Day and just launched a little teaser marketing campaign leading up to the launch. I attached a link to the first of two videos; the second video comes out next week. You can watch the video at http://www.mshopper.com. Would love to hear your thoughts. Thanks everyone!

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July 15th, 2010
by David Gould

Hi all, Forgive me, but I could not resist….My company, mShopper.com just put out its first release.  I am so very excited.  What a long strange trip it continues to be…

FOR IMMEDIATE RELEASE (JULY 14, 2010)

Media Contact
Kathryn Wardell
VP of Merchant Services, mShopper
Kathryn.Wardell@mShopper.com/ 720-279-8028
www.MobileCommerceMadeEasy.com

MSHOPPER® DEBUTS REVOLUTIONARY, PATENT-PENDING MOBILE COMMERCE PLATFORM
mShopper’s self-service, SaaS, mobile commerce platform enables merchants to design, launch, market, and promote a fully-versioned mobile store in hours, not months!

BOULDER, CO. JULY 14, 2010 — mShopper®, an emerging leader in mobile commerce, today announced a beta test of its self-service, SaaS, B2B Mobile Commerce Platform™. mShopper’s goal, according to company officials, is to allow retailers of all sizes to design and launch a customized mobile commerce application in hours, not months.

mShopper emphasizes the overall simplicity of its platform. Merchants follow a self-service wizard to upload their existing product data feeds, design custom branded mStores™, merchandise their hot deals, market their mStore with text alerts, and measure performance using built-in analytics. A fully versioned iPhone, Blackberry, and Android compatible mStore can be launched, according to mShopper, in under two hours, without any development, technical resources, or up-front investment.

mShopper’s CEO, David Gould, commented on a recent Forrester Research study. “The report found that 74% of the surveyed retailers had a mobile strategy or had plans to develop one, and spent an average of $170,000 to launch a mobile site.” Mr. Gould continued: “mShopper can launch an elegant mobile commerce solution for merchants in hours for less than $100. We save retailers tens of thousands of dollars of unnecessary investment and guarantee that they can have a store now, in time for the current back-to-school season.”

According to Mr. Gould, “mShopper’s mission is to generate mobile revenues and ROI for its merchants, not just build them an mStore. At the end of the day, it’s not about technology enablement; it’s about sales. In fact, our pricing is structured so that we really only get paid when we succeed in driving sales and ROI for our merchants.”

The company points out that its Mobile Commerce Platform includes a suite of self-service marketing tools that merchants use to promote their stores. GetFirstDibs™ represents mShopper’s patent-pending, SMS-based, consumer outreach tool. It allows merchants to build a database of fully permissioned mobile numbers and then send mobile alerts and special offers to this opted-in consumer group. In addition to mobile website creation, mShopper will provide merchants with downloadable apps available from the popular app stores: Apple, Android, and Blackberry.

“I knew I needed a mobile store to sell to my on-the-go moms, and mShopper made it easy to go mobile,” noted Heather Burns, founder of baby products retailer SmartMomma and beta program participant.

mShopper’s beta program began in May in partnership with MerchantAdvantage. It launched with retailers representing electronics, apparel, automotive, home furnishings, and beauty products. Beta merchants include Beach Camera, SmartMomma, and Surfside Sports, among others. At the conclusion, August 1, full commercial implementation will follow to provide merchants custom mStores before Q4.

“Our timing is perfect,” Mr. Gould added. “Most retailers understand that their shoppers are spending considerable time researching products on their mobile phones. However, only 12% of the top 500 Internet retailers have optimized their sites for mobile phones. This represents a huge growth opportunity.”

“Until now, going mobile has been incredibly difficult,” Mr. Gould continued. “Retailers had to contend with the complexity of platforms, interfaces, and browsers; not to mention the unique needs of their easily distracted, multi-tasking mobile shopper. mShopper took these challenges into account when creating the Mobile Commerce Platform.” In conclusion, he added: “We love our clients and love making money for them. We cannot wait until the 2010 holiday season.”

Notes to Editors:

• mShopper formally launched its B2C mshopper.com PriceCrusher platform in August 2007.
• CEO David Gould is a graduate of Harvard Business School and was the former Director of Mobile Content for Virgin Mobile
• mShopper’s Mobile Commerce Platform utilizes a proprietary shopping engine optimized for the mobile web that allows users to search and purchase with minimal input
• mShopper’s Mobile Commerce Platform can be used with any phone or Smartphone with access to the mobile web
• mShopper’s Mobile Commerce Platform is turn-key, self-service and can easily allow merchants to launch a fully branded and versioned mStore in hours
• Uses the same 128-bit encryption used by global banks for their mobile solutions

About mShopper
mShopper makes going mobile easy! A Boulder, Colorado-based mobile technology leader, mShopper offers a patent-pending Mobile Commerce PlatformTM in a self-service, SaaS application. Utilizing this platform, any merchant can launch a custom-branded, fully versioned mobile commerce store in hours (not months). All the tools for marketing, merchandising and promoting the new mobile presence are built into the platform. Learn more at www.MobileCommerceMadeEasy.com and on Twitter @MCommerceMadeEZ.

About MerchantAdvantage
MerchantAdvantage is a leader in eCommerce tool-based solutions for data manipulation, feed management, analysis, and distribution for mid-sized to Internet Retailer 1000 companies and third party companies. Merchants, marketing agencies, and service providers use MerchantAdvantage to put product catalogs in front of consumers to convert them into customers using multiple marketing avenues. Learn more at www.MerchantAdvantage.com

About Beach Camera
The latest in photography and home electronics since 1983, Beach Camera is where the customer always comes first! Learn more at www.beachcamera.com.

About SmartMomma
SmartMomma is an online baby products retailer, with a physical store location and headquarters located in Raleigh, NC, and concentrating in the sale of baby gear, furniture, toys, and accessories. Learn more at www.SmartMomma.com.

About SurfsideSports
Surfside Sports is the premier action sports retailer online and carries clothing, wetsuits, snowboards, skateboards, surfware, shoes, accessories, and top brands like Rip Curl, Volcom, Billabong, Vans, RCVA, and many others. Learn more at www.SurfSideSports.com

Additional Contact
Ken Barber
VP of Marketing and Product Development
Ken.Barber@mShopper.com

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More on Best Buy, What They Get About Mobile Commerce + What They Most Surely Do Not Get…

March 10th, 2010
by David Gould

“Best Buy Gets it: Mobile is the New Portable Store”   Mobile Commerce Daily posted this terrific article yesterday.  I guess they read my post “What does Best Buy know about Mobile Commerce that You Don’t?… The article recaps an interview with Tracy Benson, Best Buy’s interactive executive.  To be fair, and by way of disclosure, Ms. Benson was speaking at an event hosted by Mobile Commerce Daily.  Still, according to the article, there were senior executives in the audience from Wal-Mart, Costco, Dell, Victoria’s Secret and SAP, along with many others.  Here are Ms. Benson’s key points:

  • Mobile is mainstream, it’s not niche. If the mobile Internet is not mainstream today, set your timer for six to eight months – it’ll be mainstream.
  • Mobile is the new portable store, a method of bringing the brand and shopping experiences to our customers rather than have our customers come to us.
  • Budgeting. Steve Madden’s e-Commerce boss, Andrew Coven, offered the estimate of about $150,000 per year – excluding salary costs but including platform expenses.  Add some staff and marketing and  $500,000 for a reasonably decent mobile commerce operation to kick things off in the first year of executives and other factors thrown in such as marketing and advertising, should yield a decent ballpark estimate for retailers with revenue of $50 million to $100 million, or even lower than that band.
  • Mobile virgins should work with third-party platforms until the mobile commerce revenue generated calls for in-house handling.
  • This year is clearly one that belongs to mobile commerce.
  • If you’re not thinking about mobile, your customers are!

Of course, my blogging gravitas wouldn’t be worth even a simple Tweet if I did not share my opinions about these points, so….:

  1. Mobile is mainstream, it’s not niche.  Yes, yes and yes.  According to some estimates, mobile commerce is set to reach more than $2 billion this year.  Personally – and you heard it here first -total mobile commerce will far exceed that amount.  EBay and Amazon alone will generate nearly $2  billion.  Now add Best Buy, Wal- Mart, Costco and all the other big boxes and it is easy to see that number will fall way short, perhaps even by 100%.  The truth of the matter is simply this:  Mobile commerce is an extension of e-Commerce, period.  All the naysayer concerns about will people shop on their phones or is it safe are the same old nay saying retreads we heard in 1997… 
  2. Mobile is the new portable store. Yes, when it comes to the macro picture of mobile commerce, if we all build it, they will surely come!  Why?  Because the mobile commerce value proposition is a winner for consumers and merchants. For consumers, the value proposition is obvious.  Mobile commerce empowers people to save time and money!  And any channel that panders to these two perpetually winning value propositions will always succeed.  Indeed, and I am going out on a limb here, mobile commerce adoption rates will outstrip eCommerce adoption rates!  For merchants, mobile affords the opportunity for your brand to reside in your customers’ pockets and purses and belt clips (Geeks.com wins here…).  It would have been impossible for brand managers to conceive of a ubiquitous presence even 5 years ago.  Now, not only is it possible, it’s mandatory.  Because if your brand is not present, then your competitor’s brands will be…Also, there is an added benefit for pure play e-Tailers:  an incredibly cheap extension of your distribution footprint to the point of ubiquity.  That’s right.  Now e-Tailers can be present in Big Box aisles.  And they don’t have to invest in real estate, staffing, inventory, etc.  It’s a whole new retailing model.  It is truly revolutionary. As a side note, I’ll tell you one business I would not want to be in: managing and owning commercial real estate.  Brick and mortar retailers will always be present.  But cost and margin pressures will surely increase (significantly) as a result of mobile commerce and these pressures will undoubtedly  be passed along to commercial landlords…
  3. Budgeting.  $500K per year?  Nonsense.  I can state  with absolute authority that any small merchant can go mobile, with an upfront investment of $0.00 and under $100 of monthly fixed costs.  Mid sized and large merchants can go mobile for $0.00 up front and monthly fixed costs of well under $1,000.  And all merchants can access the best, built in mobile marketing, merchandising and analytics tools, all included!  On the other hand, staff will be required to manage your mobile presence, so this cost must be added…
  4. Mobile virgins should work with third-party platforms.  I could not agree more.  As I have said repeatedly, it’s the Wild West out there in mobile world.  There are no standards. There are dozens of platforms, hundreds or thousands of devices, native apps, mobile web apps, and whole new ways of thinking about the mobile consumer.  So if one wants to avoid making lots of mistakes (and take advantage of the learning curve), then partnering with a mobile expert is the only way to go!
  5. This year is clearly one that belongs to mobile commerce.  Yes, this year belongs to mobile.  But next year will be even bigger!
  6. If you’re not thinking about mobile, your customers are!  Yes, and if you are not thinking about mobile, your competitors already are… 

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Native app or Web app? Part 1

March 2nd, 2010
by David Gould

Ok, so you decided to go mobile. Phew.  Now it’s all downhill, right?  Sadly, the answer is no.  Your decision making is about to get a whole heck of a lot more complicated.  And your first decision is an epic one:  Do I go “native” or “web app”?  First, to be safe and clear (and at the risk of annoying some really smart readers), I want to make sure everyone understands the difference. 

 A native app is an application that (1) gets downloaded from a remote server or app store (like Apple’s App Store), (2)  remains resident in the user’s handset, (3) was specifically written for a specific device, (4) probably won’t work on other devices (ok, there is Java…),  (5) can access cool device APIs like the camera, address book, GPS chips, accelerometers, (6) can optimize the device’s processor and memory management, and whole lot of other features that can make for a compelling mobile experience. 

A web app is a mobile-optimized web site. It resides on a server and is accessed and viewed through the devices’ web browsers.  Because the web app is not downloaded to the device, the app cannot (yet) avail most of the device APIs and cool gadgets.  But web apps are a (a bit) easier to build, version and deploy.

Ahh, the beauty of going mobile… Yes folks, it’s the Wild West out there.  There are no standards.  There are hundreds of devices and Smartphones.  They all have different operating systems, screen sizes and nuanced little quirks.  And then there are whole arrays of native application environments… IPhone, Blackberry, Android, Windows Mobile, Symbian.

So how does one make this epic decision?  How does one create a great mobile presence without going crazy, breaking the bank, or both?  These are all great questions.  And right now, the raging or at least simmering debate amongst mobile mavens is which way to go?  Native or web…

The answer is hard to understand.  For some, you will have no choice.  If your business model depends on accessing a camera to take a photo of a bar code, then you are going native.  If you want to avail location based services, then native is for you.  But if your needs are simpler, then a web app may be the best way to go. 

And remember this:  designing, building your mobile presence marks the beginning of your mobile business, not the end.  Once you launch your mobile presence, you now have to plan for marketing, distribution, merchandising and all the other requirements that currently go into managing your e-Commerce web presence.

Still, I have not answered the question, have I?  I’ll save that for my next blog entry.  Stay tuned…

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Mobile Shopping is Expected to Hit $2.4 Billion in 2010. Why Is This Deja-Vu All Over Again?

February 22nd, 2010
by David Gould

Ah, where would we entrepreneurs be without the naysayers of the world?  According to a recently released report from ABI Research, the multi-national global connectivity research firm, mobile shopping is expected to rise 100% in 2010, to $2.4 billion.  By 2015, ABI is predicting that global mobile shopping purchases of goods and services will exceed $119 billion.  For you finance geeks out there, ABI is predicting a five year CAGR of 118%. 

Yes, mobile shopping is exploding.  For me, an entrepreneur who has been on the bleeding edge of mobile shopping for five years now, this prediction represents a yawning duh.  The cell phone is easily the most personal communications medium ever devised.  We are all addicted.  Our phones are at the center of our lives.  It’s attached to our hips (for real geeks and fashion flunkies, this is true literally).   For many or most, the ‘device’ is the first thing we look at when we wake up in the morning (so much for great morning sex) and the last thing we look at when we go to sleep.  In between, we use it to read email, tweet, check stock prices, weather, Facebook, and yes shop.  Everyone once in awhile we even make phone calls!  Combine all this with the most rash, impetuous, ‘get ‘er done’ generation ever known to mankind and yes, predicting that mobile shopping would be huge is as revolutionary as predicting that the sun will both rise and set tomorrow, except if you live in Rochester, NY where I was born and where the sun never rises or sets!

And yet, in my capacity as CEO of a certain mobile shopping start up, I cannot tell you how many venture capitalists absolutely predicted that nobody would ever buy anything through their cell phones.  It seemed to them that the very thought was retarded (sorry Trig).  I spoke with hundreds of these brilliant financiers.  Lo and behold, they all concurred.   I invoked every single analogy I could.  My personal favorite was to cite an excerpt from the Amazon IPO registration statement filed by that somewhat famous company in March, 2007, right before the very IPO that  ended up making Jeff Bezos one of the world’s wealthiest individuals.  The word-for-word citation from the second risk factor, is as follows: 

“In addition to the other information contained in [the Amazon] Prospectus, investors should carefully consider the following risk factors before making an investment decision concerning the Common Stock….(v) the level of use of the Internet and online services and increasing consumer acceptance of the Internet and other online services for the purchase of consumer products such as those offered by the Company…”

Yes people, it’s true.  In 1997, the [same?] naysayers never thought that people would buy anything through the Internet.  It was all just a fad! Many people know and have heard that the VC industry is sheep-like… baaaaahhhhhh.  Maybe that is why the VC industry is in the crapper. Funds are closing left and right  and dollars invested keep hitting record lows. 

As for my question – where would entrepreneurs be without  naysayers of the world?  Who knows, but I for one would be a whole heck of a lot richer!

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What does Best Buy know about Mobile Commerce that you don’t?

February 14th, 2010
by David Gould

Best Buy continues to go mobile, in a big way.  The company recently announced that they intend to heavily emphasize mobile marketing in 2010 and beyond.  Why?  Well, the bottom line is this:  people are mobile.  They are out and about in lives that get busier and more hectic with each passing day.  And the common thread is their cell phone.  It is how people stay connected (an odd metaphor considering phones are wireless) even as their lives get crazier.  And now, finally, with the deployment of legitimate broadband wireless networks and devices that actually make being connected somewhat enjoyable, the truth is that if your brand is not mobile, then your brand is not present precisely where your customers are.  As a marketer, that should not be a risk your brand should take.

Of course, going mobile is hard.  The mobile web (and app world), is not the web.  Successful marketing requires a whole new tool box of skills that range from technology to marketing to psychology.  There are no standards in the mobile world.  There are 1000s of handsets, each with different screen sizes, operating systems, and web browsers.  Do you go mobile web or app?  In fact, what is the difference?  Oh and just what is a mobile shopper looking for?  (Hint: save time; save money)  Still, put aside all these difficulties because the question,  “Do I go mobile or not?” is moot. 

Here is how I see it:  Your customers are mobile.  Your competitors are  mobile. Are you?  I think that on my next post, I will discuss how and why the mobile web places incredible pressure on the static web.  Remember, we live in a world that values present value…

By way of disclosure, my company, mShopper, makes going mobile easy.  We operate the world’s only SaaS, self service, turnkey mobile enablement platform.  Feel free to check it out…

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Mobile Marketing News today

January 4th, 2010
by David Gould

Mobile Commerce: Survey Finds 17% Of US Adults Use Mobile Banking, Mobile Web & SMS Leading Methods – Mobile Market… http://ow.ly/16wU3l

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