Mobile commerce

Mobile commerce is a way of buying and selling things using mobile phones or other wireless devices. The idea was first introduced in 1997 by Kevin Duffey, who described it as putting shopping right in people’s hands, no matter where they are. This means people can shop online from anywhere using their phones.

Many people now use mobile commerce to buy things they need or want. It has become very popular and is worth a lot of money — about US$800 billion. Much of this business happens in Asia, where almost half of all mobile shopping takes place. This shows just how important mobile devices have become for shopping around the world.

History

The Global Mobile Commerce Forum started in London on November 10, 1997, with over 100 organisations joining. Kevin Duffey became the Executive Chairman, and the forum was opened by Dr Mike Short, a former chairman of the GSM Association. Early forecasts for mobile commerce were shared by Kevin Duffey and Tom Alexander.

In 1997, the first mobile-commerce services began with two Coca-Cola vending machines in Helsinki, Finland, that let people buy drinks using SMS text messages. This led to new ideas like mobile banking in Finland and mobile check-in for Finnair flights starting in 2001.

As mobile commerce grew, new services appeared. In 1998, people could download the first ringtones to their phones in Finland. By 1999, big mobile platforms launched in the Philippines and Japan. In the early 2000s, countries like Norway and Austria began offering mobile services such as parking payments and train tickets.

With the launch of the iPhone in 2007, mobile commerce changed from using text messages to using apps on smartphones. Today, many shops use mobile tools to help customers, like showing reviews or coupons on their phones while they shop in stores.

Products and services available

Mobile money transfer

In Kenya, many people use their mobile phones to send and receive money. This started with a big company there called Safaricom. Today, Safaricom and another company called Airtel help people send money using services named M-PESA and Airtel Money.

Other countries have similar services too. In Denmark, Danske Bank offers a service called MobilePay that became popular with over 1.5 million users. In Norway, people can use a service called Vipps.

Some places also have mobile ATMs, which are like cash machines that can be moved around. These are useful for special events where normal ATMs aren’t available.

Mobile ticketing

Main article: Mobile ticketing

People can now get tickets on their phones. These tickets can be shown on a phone when needed, like for boarding a bus or plane. For example, in India, the IRCTC sends tickets as text messages. New technology like RFID can also make tickets directly on phones.

Mobile vouchers, coupons and loyalty cards

Phones can also receive special offers, coupons, and loyalty cards. These appear as codes on the phone and work just like paper ones when shown at a store. Stores can even send coupons when you’re close by, using your phone’s location.

Content purchase and delivery

People buy things like ringtones, wallpapers, games, and apps using their phones. With fast 4G networks, even movies can be downloaded quickly to a phone.

Location-based services

Main article: Location-based service

Knowing where a phone user is helps provide useful services like local weather, nearby discounts, or even tracking people.

Information services

Phones can show many kinds of information, such as news, sports scores, traffic reporting, and emergency alerts. Phones can even send personalized traffic updates based on where someone is going.

Mobile banking

Main article: Mobile banking

Banks let people check their money and make payments using phones. This is called mobile banking.

Mobile brokerage

People can also buy and sell stocks using phones, which helps them react quickly to market changes no matter where they are.

Auctions

Some phone services let people bid in auctions by sending text messages. These “reverse auctions” charge the phone each time someone bids.

Mobile browsing

Main article: Mobile browser

Phones have web browsers that let people shop online anywhere, not just on a computer. Apps can even send special offers to the right person at the right time.

Mobile purchase

Shops can take orders through phones. Sometimes, the shop even sends its catalog right to the phone instead of on paper. Phones can also offer extra deals when people shop this way.

In-application mobile phone payments

People can pay for things right inside apps on their phones. These payments go through mobile carriers, not just app stores.

Mobile marketing and advertising

Main article: Mobile marketing

Mobile marketing means sending ads and offers to phones. Because phones are always with us, people can act on these offers right away. For example, someone might get a message about baby products while doing chores and can easily order them without leaving home.

Influence on youth markets

Mobile commerce is a fast-changing field, with new technologies like WiMax helping it grow quickly. Early leaders in mobile advertising include Vodafone, Orange, and SK Telecom. A study from 2019 shows that more than 70% of people who use mobile commerce are under 25 years old.

In South Korea, many young people use their mobile devices for shopping. Mobile companies there thought that mobile technology would become a big part of young people's daily lives, based on what they saw with earlier generations. One expert, Daniel Longfield, said that making money for device makers and mobile companies depends on offering the best mobile devices and popular apps.

Payment methods

Main article: Mobile payment

People have many ways to pay when they shop using their phones. One common way is through contactless payment, where you tap your phone to pay, just like using a contactless credit or debit card. Examples include Apple Pay and Google Pay.

Other methods include adding charges to your phone bill, using credit or debit cards stored on your phone, or even using special services for small payments. Some apps also let you store value on your phone to use for buying things, like in music or app stores.

App design

Interaction design and UX design are very important for mobile shopping apps. Good app design helps users shop easily and quickly. For example, in fashion apps, making it simple to find products is very important. Another reason people use these apps is to shop for others, and they like when the app connects well with social media. Culture also plays a role — people from different places, like Western countries and China, have different reasons for using these shopping apps.

App commerce

Because apps are so popular, a new kind of mobile shopping has grown: app commerce. This means buying things straight from an app on your phone. Apps are great because people spend more time on them and enjoy them more than regular websites. When people shop using apps, they often spend more money and are more likely to make a purchase than when they shop on mobile websites. The easy-to-use and special features of apps make them a favorite way for smart phone users to shop.

shopping channel

Mobile Device Shopping Trends

Mobile apps help make shopping easy and fun, and they can also help businesses earn more money. One report says that by 2020, mobile apps could help create $189 billion in sales. Another study shows that in 2018, people used their phones to buy things worth over $1 trillion.