Tesco’s decision to launch its first transactional mobile service suggests m-commerce is ready to enter the mainstream. But when will smaller brands with less financial muscle follow suit?
The news that supermarket giants Asda and Tesco are both looking to launch m-commerce channels is a significant milestone for the mobile industry (nma 5 August 2010).
The fact that Tesco is eschewing the option of launching its mobile retailing strategy with an iPhone app also shows a sophistication in its thinking.
Less detail is clear on how Asda will broach the sector, but I imagine it too will target the mass market, not just iPhone or Android users.
Add to that the purported successes of Marks & Spencer’s and Ocado’s m-commerce strategies, and all appears well in the sector.
However, if it was as simple as that, then m-commerce would have taken off years ago. Unfortunately, it’s a little bit more complicated.
A recent survey of large and medium-sized retailers by mobile agency Sponge claimed two-thirds have yet to launch optimised mobile sites. Less than half of those retailers with mobile-optimised websites have transactional capabilities. This demonstrates the scale of just how far m-commerce has to go before it can declare itself a mainstream venture.
The dilemma facing most retailers is how to make any investment in m-commerce worth their while.
M&S and Ocado target comparatively well-off consumers, so it’s not unreasonable to think many of their customers will have smartphones. Hence they can forgo the mass mobile audience without thinking they’re alienating too many people.
But most UK retailers target very fragmented audiences and are faced with the dilemma of where to start addressing m-commerce.
Tesco has signalled its determination to take m-commerce into the mainstream by launching on Nokia’s Ovi Store, a platform synonymous with the word fragmentation. However, I doubt most other retailers will have the research and development budgets to match Tesco’s and really make m-commerce a mainstream channel.
So while the Tesco app’s arrival in the Ovi Store is a milestone – and a bold move by the retailer – it doesn’t mean that m-commerce’s mass take-up is a foregone conclusion.