25 june bt pay_pal and the m-commerce market in s'pore
Client : PayPal Country : SingaporePublication : The Business Times Section : Biz ITDate : 25 June 2012 Page : 35Topic : PayPal and the m-commerce market in SporeCirculation : 37,500PayPal and the m-commerce market in SporeBY TIMOTHY LOH[SINGAPORE] The mobile commerce (m-commerce) market is growing exponentially in Singapore,but merchants are not keeping pace with changing consumer preferences, says Rahul Shinghal,director of PayPal Mobile Asia Pacific.The e-payments company, however, intends to change that, with two new m-commerce productslaunched this year.A study by the Nielsen Company commissioned by PayPal last year revealed that total spending onmobile commerce in Singapore increased almost eight-fold in the last year, from $43 million to $328million. The e-commerce company also anticipates that the local m-commerce market will reach$3.1 billion by 2015.The growth of the m-commerce market is primarily consumer-driven, not merchant-driven, said MrShinghal. More and more consumers are visiting e-commerce sites, with 20 per cent of traffic tothese sites coming through smartphones and tablets, up from 5 per cent last year.He attributed the surge in traffic to the proliferation of smartphones among Singaporeans, with upto 70 per cent of locals carrying an iPhone or Android handset, as well as the depth of 3Gpenetration here.PayPals research indicates that customers between the ages of 18 and 44 now use their mobilephones as their primary Internet-access device, and may choose to surf the Web and makepurchases on their phones even if theyre sitting in front of their personal computers (PCs).Mr Shinghal explained: "You have a device in your pocket which you dont have to switch on or login, thats always connected and easy to use."He also cited the rise of daily deal sites, such as AllDealsAsia and Groupon, as a factor fuelling m-commerce growth. Subscribers to mailing lists of these websites receive a daily email update on
which deals the site is offering, read it on their phones and go on to access these deals directly ontheir mobile devices.But only one in every four Singaporean businesses have a mobile-friendly website. PayPals surveyshowed that nearly two-thirds of mobile shoppers in Singapore had previously stopped a mobiletransaction because of the hassle of entering their financial details, such as 16-digit credit cardnumbers, on a small screen."They dont realise how badly this is impacting their business," said Mr Shinghal. "The need tomobile-optimise their sites is so urgent, so real, and they have to do it now."None of the other payment providers are offering a mobile-optimised payment system," he said,adding: "Theyre just forcing a desktop experience on a mobile device."PayPal, however, plans to forge the way forward with two m-commerce solutions unveiled lastmonth that will enable businesses to take advantage of increasing demand among consumers formobile- friendly interfaces when making online purchases.With the first solution, the PayPal Mobile Payments Standard, customers who shop on a PayPalmerchants website on their handphones will be redirected automatically to a mobile-optimisedpayment page during checkout, even if the merchants website is not mobile-optimised.Mr Shinghal said: "Once you come into the PayPal world, we will offer a mobile-optimisedexperience, which is clean, nice and fits the screen, because we respect the (mobile) channel anduser experience."PayPal is also piloting its Mobile Commerce in a Box solution and expects a full launch by year-end.The M-Commerce in a Box is a software that merchants plug into their e-commerce websites, whichconverts their sites desktop interface into a mobile-optimised one. The conversion process takesless than an hour and is cost-free to merchants.For merchants concerned about additional costs incurred in mobile optimisation, Mr Shinghal notedthat "the cost of going mobile compared to the amount of consumers they are losing is marginal".Anecdotal data has revealed a 15-day return on investment after going mobile, he said.From the consumers perspective, a major concern in making mobile purchases is security. To thisend, PayPal has taken measures to protect customers financial information. The data is nevershared with merchants, but is securely processed on PayPals servers. It is also not stored oncustomers handphones, so even if they lose their phones, their personal information remainssecure."We have the lowest fraud rates in the world among e-payment companies, and thats testament tothe fact that security is really part of our DNA," said Mr Shinghal.He expects smartphone and tablet sales will far outstrip PC sales in the near future. With demand formobile-friendly platforms on the rise, he also sees that "mobile will keep driving the convergenceand blurring the lines between online and offline", and businesses would do well to leverage thistrend.
In fact, PayPal held a Quick Response (QR) code campaign with SMRT in February and April, where itplaced live transactional advertisements at various MRT stations. Commuters could purchase itemsby snapping a shot of the items QR code with their smartphone cameras.Mr Shinghal said: "Any merchant who feels its too early for mobile, Id urge them to go and look attheir back-end analytical data. They can see what kind of traffic is coming from where and whatpercentage is coming through mobile devices."When they fall off their chairs, ask them to call us," he quipped.