Almost one in every two dollars spent online will come from purchases made using a mobile device by 2020. This will be fuelled by contextual shopping, a mobile first mentality, and an increasing reliance on mobile devices.
That’s the conclusion of US consultancy firm Javelin’s report 2016 Online Retail Payments Forecast which examined new Internet of Things (IoT) and mobile devices, and applications that consumers are using to more efficiently purchase through online and mobile channels.
The researchers said ecommerce, m-commerce and social purchases have dominated the headlines as top vehicles and drivers for consumer purchases for the past decade. Today, a new “contextual” consumer is in town, whose reliance on IoT and other mobile devices creates an environment for greater impulse purchases.
They pointed out that buy buttons were introduced in 2014 to enable retailers to bring goods and services into social media, allowing consumers to casually browse and purchase in-app, without ever having to leave the social media site.
Similarly, according to the study, “IoT devices are smart devices with embedded and networked sensors and the ability to use Wi-Fi or wired connections to transmit information, allowing consumers to purchase directly from the device with each interaction.”
For example, they said that a consumer would place an Amazon Dash Button to the Tide laundry detergent for the washing machine and press it to reorder a new box when the detergent runs low. These IoT devices such as Dash buttons, Amazon Echo/Alexa, and Samsung Family Hub, and mobile apps like Fandango, Papa John’s, and Ikea, are becoming more relevant to consumers by being positioned within a home or office and able to engage in commerce at a moment’s notice.
“As consumers move to a ‘mobile first’ mentality when it comes to e-commerce, they are relying on the most frictionless payments to complete purchases ‘on the go’,” said Michael Moeser, director of payments at Javelin. “Consumers will increasingly gravitate to using payment forms that offer the easiest, fastest and most secure payment methodology, particularly one that also integrates shipping/billing addresses as this removes the challenges of typing on a smaller phone keyboard.”
According to the authors, “Online retail transactions, through both PCs and mobile devices, also known as e-commerce, continue their rapid rise, climbing by almost 12 per cent, from $US379 billion in 2014 to nearly $US424 billion in 2015. Mobile devices continue to comprise an increasing share of e-commerce sales, and the integration of channel options ─ allowing shoppers to select and pay in one channel and pick up or return merchandise in another ─ has enhanced the value of digital options as a medium for commerce.”
They also said that new market trends are contributing to an increasingly dynamic digital commerce marketplace. These trends include mobile apps that speed up in-store checkouts, apps that integrate with mobile wallets to enable purchasing, and the use of embedded and networked device sensors for reordering.
This article originally appeared on B&T’s sister business site www.which-50.com