The modern retail store isn’t built of brick and mortar. It’s made of menus, descriptions, reviews, links, and a search bar. Most importantly of all, consumers don’t walk into a modern store. They carry it with them in their pockets. With 53 percent of Americans owning smartphones, and the same percent having shopping/retail apps according to Nielson, mobile consumerism is being embraced around the world.
Why Do Consumers Choose Mobile?
One of the biggest reasons many consumers choose to shop with their phones is convenience. Instead of having to travel to the physical address of a store, they simply type in a web address and can instantly find, compare, and buy products from the comfort of wherever they happen to be. They’re not burdened with having to navigate isles pushing an overloaded shopping cart, or finding a way to fit a large item in a small car. Travel aside, Americans are already in love with using their smartphones. In fact, they typically spend over two hours each day on mobile devices, checking their phones almost 150 times. Mobile consumerism is simply easier, and so many choose it, but convenience isn’t the only reason shoppers are going mobile. Information is just as important.
Modern consumers are cautious and intelligent. Though they might still jump at a well placed item for an impulse purchase, they demand information about anything of real value or cost. Descriptions, FAQ’s, and even buyer reviews can be found on many online stores, not because sellers want to list these details, but because if they don’t, users will go somewhere else to find it.
One of the biggest reasons that consumers choose mobile is that online marketplaces offer an unparalleled variety of products and services. If something isn’t available at one store, users can almost certainly find it at another with only a few taps of touch screen. Mobile consumers have access to millions of products and services literally at the tips of their fingers. Brick and mortar locations just can’t offer that kind of selection.
What Mobile Consumerism Means for Businesses
That increased variety of selection for consumers, offers a challenge of increased competition for businesses. Many online retailers feel forced to cut prices, and therefore profits, to compete with the rest of the market. As with physical retailers, this is ones pricing strategy, but it isn’t the only option. Due to their heightened knowledge and selection, mobile consumers naturally embrace the concept of value more than all others. A low price point won’t necessarily drive purchases when users can easily find product with much more value at a slightly high price.
The availability of information and reviews in online marketplaces means that businesses have to operate with a great deal more transparency than at physical locations. Deceptive practices, poor quality, and bad customer service is quickly flagged in consumer reviews, and can easily destroy an online retailer. In addition to this, security is a major concern.
Making purchases with a phone means that financial details like credit card numbers must be accessed. This makes online marketplaces a prime target for cyber criminals. Target, P.F. Chang’s, Michaels, Sally Beauty, Neiman Marcus, AOL, Adobe, Snapchat, and even eBay, the king of online auction sites, have all been infiltrated this year, but hackers don’t just attack businesses. 47 percent of adult Americans have already had their personal information exposed by hackers in 2014. This was according to a study by the Identity Theft Resource Center and a review of corporate disclosures by CNN Money. Companies must deal with the threat of data theft, or risk a leak, and attempt to regain consumer trust.
While mobile consumerism offers many challenges to businesses, it also offers some opportunities. One of the biggest advantages of mobile consumerism is that it eliminates a large amount of overhead costs for sellers. Instead of having to pay for rent at an expensive, high-traffic, location, retailers can pick warehouses and headquarters located in much cheaper areas. By outsourcing or sharing labor costs like packaging and shipping with other businesses, sellers can also cut costs dramatically.
Another opportunity provided by mobile consumerism is that it may also be used to augment physical purchases. For instance, location tracking in smartphones can be used with permission to send updates and offers, based on the user’s location. A restaurant may send promotional items like discounts when consumers are close by, which may encourage purchases. Users can even place orders for products and services online from their devices, to be picked up at a later time.
Mobile consumerism allows shoppers to harness staggering amounts of information and browse unbelievable selections of products at a level of convenience that is completely unprecedented. Although many businesses avoid joining the online marketplace, the opportunities and advantages are undeniable. Modern stores aren’t built of bricks and mortar. They’re made of menus, descriptions, reviews, links, and a search bar.