Australian Retail Goes Mobile
- Mobile payments grow 14 fold year on year.
- 68 per cent plan to make mobile payments in future.
- Internet-enabled phones account for 65 per cent of all mobile devices
On the back of the recent announcement that Visa is trialling mobile phone chips as conduits of making retail payments, online PayPal specialist says Mobile commerce is altering the retail landscape and is set to rocket in 2011, according to a report the company put out recently.
Titled mCommerce: Secure Insight, the report claims that with the rapid adoption of web enabled mobile devices fuelling consumer demand, Internet enabled phones now account for 65 per cent of the total handset market and 68 per cent of Australians plan to use mobile devices for transactions and payments in the near future.
In the last year, the mCommerce market in Australia hit $155 million in total payments, and PayPal’s mobile payment volume grew 14 fold. The consumer demand for mobile payments is in the here and now with 10 per cent of PayPal’s 3.6 million active consumer accounts having completed transactions on mobile devices in the last quarter of 2010, up from just one per cent in 2009.
“With the arrival of mCommerce we expect to see more change in the retail industry in the next three years than we have seen in the last decade,” said Frerk-Malte Feller, Managing Director for PayPal Australia. “In the last quarter, our merchants have enjoyed a 25 per cent month on month increase in total mobile payment volumes. Retailers must embrace mCommerce now or risk being left behind. Australian retailers were late to the eCommerce market and cannot afford to make the same mistake again.”
Jennifer Cromarty, Australian Retailers Association Deputy Executive Director, said: “It is time for Australian retailers to form strategies addressing multiple channels. The retail industry is evolving and retailers must move with it to both remain competitive and meet shifting consumer demands. Put simply, retailers must have a presence wherever their customers are – be they in store, online or on their mobile phones.”
Web-enabled phones are fuelling the demand for mobile commerce and currently account for 65 per of the total market. With the average consumer changing phones every two years, Internet-enabled phones may reach 100 per cent penetration by 2013. The most popular time for mobile shopping is when consumers are traveling and 76 per cent of consumers cite convenience as the main reason for transacting on the go.
One of the barriers to greater adoption of mCommerce is security and over half of Australians are not convinced the current security measures for mobile transactions are adequate. Usability is also a key concern and the size of the screen being too small and difficult to use is an issue for almost half of consumers. PayPal is designed to offer a secure payment platform no matter what medium the transaction goes through.
The company says it does not store any financial information on the mobile device and no credit card details need to be entered on the small screen.