“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….:
- 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…
- 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…
- 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…
- 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!
- This year is clearly one that belongs to mobile commerce. Yes, this year belongs to mobile. But next year will be even bigger!
- If you’re not thinking about mobile, your customers are! Yes, and if you are not thinking about mobile, your competitors already are…