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Telecommunications: UK Mobile Christmas Shopping Grows from 'About Zero' in 2010 to $2 Billion

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December 29, 2011

Telecommunications: UK Mobile Christmas Shopping Grows from 'About Zero' in 2010 to $2 Billion

By David Sims, TMCnet Contributing Editor

Amdocs (News - Alert), a telecommunications provider, recently noted in a blog entry by Naomi Weiser recently noted that two shoppers recently bought $100,000-plus Ferrari and “a new home via eBay (News - Alert) subsidiary PayPal’s mobile app on Cyber Monday.”

Don’t try this at home with Mommy and Daddy’s smartphone, kids.

Most of us use smartphones to purchase more, uh, modest items. Songs on iTunes, for example. But we’re heading towards big ticket territory, Weiser writes, noting recent findings from data research and analysis firm comScore (News - Alert) show that in September two-thirds of all smartphone owners made more substantial purchases on their phones.

British retailers Argos, ASOS and Debenhams are trying to find ways to sell their products through mobile apps. American retailers like Toys R Us, JC Penney, Lowes, and Best Buy (News - Alert) are testing such approaches as giving store reps mobile phones to help shoppers instantly compare prices and match them when necessary, Weiser says.

Overall, a bit over a third of smartphone owners have used their phone to make an actual  purchase at least once during their device ownership, the comScorestudy found.

Mobile commerce is one of those things that is rapidly morphing from a novelty into how society works. “The 300 largest U.S. mobile merchants will generate $5.37 billion in sales through mobile devices this year, more than double 2010,” Weiser says, citing a recent survey by Internet Retailer.

How fast has this growth been? Last year, according to Professor Joshua Bamfield, director of the Centre for Retail Research in Great Britain, mobile Christmas shopping in the UK totaled “about zero.” Bamfield estimated this year it would account for about $2 billion.

That’s what we call “growth,” friends.

Weiser reads the writing on the wall and arrives at the correct conclusion: Brick and mortar retailers should find new ways to embrace mobile commerce if they want to stay in business. She quotes Avi Greengart, research director, consumer devices, at Current Analysis (News - Alert), saying that merchants who invest in mobile sales now “will reap the benefits of m-commerce far faster” than those who drag their feet.

Oded Israeli, director of product management and marketing for Amdocs Mobile Payments, told Weiser that as far as service providers are concerned, operators usually see these transactions going over-the-top, “as they only provide the connectivity for regular card transactions.” But carriers can play a larger role in smaller impulse purchases, “providing the funds for the transaction through the postpaid bill or prepaid balance.”

Probably not a Ferrari, though. Sorry.

David Sims is a contributing editor for TMCnet. To read more of David’s articles, please visit his columnist page. He also blogs for TMCnet here.

Edited by Carrie Schmelkin

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