E marketer retail mobile commerce

Copyright ©2013 eMarketer, Inc. All rights reserved.

The Big Picture: Retail Mcommerce Forecast 2
Smartphone Shopping and Spending Trends 4
Commerce of Convenience (Almost) 7
Conclusions 11
eMarketer Interviews 12
Related eMarketer Reports 12
Related Links 12
January 2013
Executive Summary: Consumers are creatures of convenience. With digital storefronts just an arm’s length away,
millions are reaching first for their smartphone when the urge to shop strikes. Whether at home or on the go, these
consumers use their phones to browse and research products, hunt for deals and make purchases.
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eMarketer’s mobile commerce forecast reflects a confluence of
three trends: the expanding number of smartphone shoppers,
whose behavior affects commerce in all channels; the growing
number of smartphone buyers who enjoy the immediacy of
purchasing through their phone and are expected to generate
roughly a third of mcommerce sales this year; and the rapid rise
in tablet shopping, which will produce the bulk of mcommerce
sales over the next four years.
This report presents eMarketer’s latest mobile commerce
estimates and discusses smartphone shopping and sales trends,
including the dual role smartphones play as a sales channel and as
an influencer on purchases made through other means.
US consumers will spend $13.4 billion on retail purchases made
via smartphones in 2013, up from $9.8 billion last year. Despite
these gains, buying products (other than digital content) with
a smartphone can often be cumbersome. So even though
shopping sessions frequently start on a smartphone, they often
still end on a computer or in a physical store.
Key Questions
■■ What is the outlook for mcommerce sales?
■■ What level of sales do smartphones generate?
■■ How,when and where do consumers use smartphones to shop?
■■ Where are retailers falling short in meeting smartphone
shoppers’ expectations?
billions, % change and % of total retail mcommerce sales
US Smartphone Retail Mcommerce Sales, 2011-2016
2011
117.5%
55.0%
2012
31.6%
40.0%
2013
35.0%
2014
24.2%
32.0%
2015
22.7%
30.0%
2016
$7.50
$9.86
$13.44
$16.69
$20.49
$24.32
18.7%
28.0%
Smartphone retail mcommerce sales % change
% of retail mcommerce sales
Note: excludes travel and event ticket sales
Source: eMarketer, Jan 2013
149663 www.eMarketer.com
36.3%
Cathy Boyle
cboyle@emarketer.com
Contributors:
Christine Bittar, Jeff Grau, Stephanie Kucinskas,
Haixia Wang
Retail Mobile
Commerce Forecast:
Shoppers Turn to Smartphones First

Retail Mobile Commerce Forecast: Shoppers Turn to Smartphones First Copyright ©2013 eMarketer, Inc. All rights reserved. 2
The Big Picture: Retail Mcommerce
Forecast
Today’s mobile shoppers are bewitched by the
immediacy of smart devices—the ability they provide
to access product information, deals and sales now
and the power to purchase now, all with a tap of a
fingertip. eMarketer projects double-digit increases in
the number of mobile shoppers and buyers over the
next two years and expects mobile retail sales to rise
from $38.4 billion this year to $86.8 billion in 2016.
Tablets are expected to play a pivotal role in the growth of mobile
commerce as consumers adopt these larger but still easily
portable devices even faster than they did smartphones. Retail
purchases made through tablets are expected to comprise 70%
of mcommerce sales in 2016, up from 62% this year.
Likewise, sales made through smartphones are expected
to grow at double-digit rates and comprise roughly 30% of
mobile commerce sales each year through 2016. Purchases
made through other mobile devices, such as ereaders or
handheld gaming systems, will represent less than 3% of total
mcommerce sales during the period.
billions and % of total
US Retail Mcommerce Sales, by Device, 2011-2016
Tablet
—% of total
Smartphone
—% of total
Other mobile devices
—% of total
Total
2011
$5.45
40.0%
$7.50
55.0%
$0.68
5.0%
$13.63
2012
$13.86
56.2%
$9.86
40.0%
$0.94
3.8%
$24.66
2013
$24.00
62.5%
$13.44
35.0%
$0.96
2.5%
$38.40
2014
$34.33
65.8%
$16.69
32.0%
$1.15
2.2%
$52.17
2015
68.0%
30.0%
2.0%
$46.44
$20.49
$1.37
$68.29
2016
70.3%
28.0%
1.7%
$61.06
$24.32
$1.48
$86.86
Note: excludes travel and event ticket sales
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An Expanded View of Mobile Commerce
Due to the rapid adoption of tablet devices in the US and
the robust growth of the mobile app economy, eMarketer
has expanded the scope of its retail mobile commerce
forecast. The forecast now includes shopping for or buying
physical or digital goods using a browser or app on a
mobile phone, tablet, ereader or other handheld device,
such as a gaming system or an MP3 player.
Mirroring the retail ecommerce categories established by
the US Department of Commerce, sales of mobile apps
and in-app purchases are also included in eMarketer’s
mcommerce forecast, but travel and event ticket sales
are excluded. Point-of-sale payments made using a mobile
device at a physical store are also excluded as the mobile
device is serving only as a digital wallet for cash or credit.
eMarketer’s retail mcommerce sales forecast and its
mobile shopper and buyer forecasts are derived by
comparing estimates from other research organizations
and weighing overall mcommerce trends.
Mobile Shoppers vs. Buyers: Some consumers use a mobile
device to browse, research or compare products but stop
short of the mobile checkout counter. eMarketer classifies
these “just browsing” consumers as mobile shoppers. Those
who buy are referred to by eMarketer as mobile buyers.
Both groups have a base age of 14 and have shopped or
made a purchase with a mobile device within the past year.
Mobile Registers Are Ringing
Ecommerce sales may ring the loudest but mcommerce sales are
chiming in with greater volume each year.Retail sales generated
via mobile devices in 2013 are projected to total $38.4 billion and
represent 15% of ecommerce sales.eMarketer projects mobile’s
annual sales tally will increase by double-digit rates through 2016,
at which point roughly a quarter of ecommerce sales will come
through mobile devices.
billions, % change and % of retail ecommerce
US Retail Mcommerce Sales, 2011-2016
2011
$13.63
168.9%
7.0%
2012
$24.66
81.0%
11.0%
2013
$38.40
55.7%
15.0%
2014
$52.17
35.8%
18.0%
2015
$68.29
30.9%
21.0%
2016
$86.86
27.2%
24.0%
Retail mcommerce sales % change % of retail ecommerce
Note: excludes travel and event ticket sales; includes sales on tablets
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eMarketer’s retail mcommerce projections have been raised
compared to the forecast published in January 2012 to reflect
the inclusion of digital content sales and sales made through
all mobile devices. The optimistic outlook for growth is based
in part on data reported in Q4 2012, including:
■■ comScore’s estimate that US retail mcommerce sales in
2011 represented 7.7% of total ecommerce sales.
■■ Internet Retailer’s estimate that mobile commerce sales
from the 400 biggest retail, ticket and travel companies in
the US totaled $10.85 billion and represented 52% of total
US mcommerce sales in 2012.
■■ Findings from Javelin Strategy and Research that valued the
US retail mcommerce market at $20.7 billion for 2012.

eMarketer believes the estimates made by these companies
are conservative given the rapid adoption of tablets and the
steady growth of smartphone ownership. Together, these
devices are extending traditional shopping hours well into the
evening and the average order values made via tablets and
smartphones are exceeding desktop averages as consumers
grow more comfortable buying through portable devices.
Majority of Online Shoppers are Mobile Shoppers, Too
eMarketer’s mobile shopper forecast reflects a cultural shift
toward a mobile-centric lifestyle in the US, one in which all
things digital are increasingly accessed through mobile devices.
Smartphone and tablet usage is expected to increase rapidly in
2013 and grow at double-digit rates for the next two years.
The mobile shopper and buyer audiences are expected to
expand in a similar fashion. eMarketer forecasts the number
of mobile shoppers in the US will increase by 24% in 2013 to
118 million consumers and represent 62% of digital shoppers.
Over the next four years, the overlap between mobile and
digital shoppers will steadily increase as the number of mobile
shoppers grows to 174 million in 2016. At that point, roughly
eight out of 10 digital shoppers will also be mobile shoppers.
millions and % of digital shoppers
US Mobile Shoppers and Penetration, 2011-2016
2011
68.4
38.4%
2012
94.8
51.5%
2013
118.0
62.2%
2014
139.7
71.5%
2015
159.1
79.1%
2016
174.9
84.6%
Mobile shoppers % of digital shoppers
Note: ages 14; mobile device users who have used their mobile device to
browse, research or compare products via web browser or mobile app
within the past year, but have not necessarily made a purchase via mobile
device
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The rising tide of mobile traffic to retail destinations is a clear sign
of the consumer shift toward mobile shopping.A year-long analysis
of the traffic patterns of 150 US ecommerce sites conducted by
marketing technology provider Monetate showed mobile device
activity more than doubled in a year.In Q3 2011,smartphones and
tablets combined accounted for less than 8% of traffic for sites
using the Monetate platform.Twelve months later,smartphone
traffic alone comprised 8% and tablets held a 10% share.A similar
growth trend was noted by research firm comScore:one in eight
page views,or 13.3% of all internet visits,inAugust 2012 (including
those outside the retail sector) stemmed from mobile devices,
double the share from a year earlier.Unlike the Monetate findings,
comScore’s analysis showed mobile phone users outpaced tablet
users in site visits by roughly 2-to-1.
“Thirty percent of our site traffic comes from mobile devices
and between 70% and 75% of our customers are using
iPhones,” said Bridget Dolan, vice president of interactive
media at beauty products retailer Sephora. Like Sephora’s
customers, the largest share of mobile shoppers on Black
Friday and Cyber Monday 2012 used a smartphone to access
retail sites, but tablet traffic grew the most year over year,
according to findings from IBM Digital Benchmarks. So, while
smartphones lead the way now, that is likely to change quickly.
As the number of mobile shoppers goes up, so does the
number of buyers. “We’ve definitely seen a progression of our
shoppers completing the full purchase on the device. They’re
not only browsing and price-comparing, they’re placing full
orders,” said Aki Iida, head of mobile for shoe and apparel
retailer Zappos.com.
Retail trends and the latest research leads eMarketer to believe
that 72 million people in the US will make a purchase through a
mobile device in 2013, a figure that will increase nearly 65%, to
119 million, in 2016.The growth of the mobile buyer community
will be fueled in greatest measure by the expanding number
of tablet users who, as noted in eMarketer’s June 2012 report,
“Tablet Shopping Fuels ‘Couch and Pillow’ Commerce,”
are more prone to buying. Still, the number of consumers making
purchases on a smartphone is expected to increase by double-
digit levels for the next three years and contribute significantly to
the overall expansion of the mobile buyer population.
The Big Picture: Retail Mcommerce Forecast

millions and % change
US Mobile Buyers, 2011-2016
2011
33.2
117.0%
2012
52.5
57.9%
2013
72.6
38.3%
2014
89.1
22.7%
2015
105.1
18.0%
2016
119.6
13.9%
Mobile buyers % change
Note: aages 14+; mobile device users who have used their mobile device
to make at least one purchase via web browser or mobile app within the
past year
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“Just four years ago mobile commerce barely existed. Today,
mobile touches nearly one in every three purchases on eBay,”
said Steve Yankovich, vice president of mobile for eBay, in a
company blog post on December 11, 2012. Prescription drug
retailer Walgreens has also seen the number of customers
using a smartphone to order and buy prescription refills
steadily increase. “The latest numbers show 40% of our online
prescription business now comes from mobile,” said Tim
McCauley, Walgreens’ senior director of mcommerce.
Smartphone Shopping and
Spending Trends
eMarketer’s adjusted mobile commerce forecast
sheds light on several key trends related to
smartphone-driven commerce:
■■ Roughly six out of seven mobile shoppers, or 100 million US
consumers, will use a smartphone to shop in 2013. Over the
next three years, the US smartphone shopper population
will expand by 55% to comprise 155 million people in 2016,
or nearly half of the US population.
■■ The number of smartphone buyers will increase by a larger
degree (60%) over the next three years as retailers continue
to invest in mobile storefronts and gain experience in
converting mobile shoppers to buyers. Buyers will represent
just over half (53%) of the smartphone shopper population
in 2016, leaving significant headroom for growth.
■■ Average annual sales per smartphone buyer will rise
incrementally through 2016.Indeed,current buyers are expected
to spend more as they gain confidence in the channel,but
growth in the average annual spend per buyer will be tempered
by a larger,more economically diverse smartphone user base.
This year,the average smartphone buyer is expected to spend
$262 on purchases made with their phone,and that figure will
rise 12% over the next three years to reach $295.
Key eMarketer Numbers—US Smartphone Retail
Mcommerce
99.9
155.3
51.3
82.3
$13.44
$24.32
$262.19
$295.65
Note: *ages 14+; **excludes travel and event ticket sales
Smartphone shoppers*
(millions)
Smartphone buyers* (millions)
Smartphone retail mcommerce
sales** (billions)
Average spend per smartphone
buyer
2013 2016 2013 2016
2013 2016 2013 2016
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Spending Preferences and Patterns Emerge
The comfort zone on spending levels is shifting as
smartphones become a more commonly accepted shopping
channel. Forty-five percent of smartphone owners surveyed
by Mojiva said they were comfortable spending $50 or more
The Big Picture: Retail Mcommerce Forecast

on holiday gifts purchased with their phone, up 5 percentage
points from a similar survey conducted a year earlier. On
the other end of the spectrum, the number who said they
wouldn’t spend a penny through their phone was less than
half the size it was in 2011, shrinking from 21% to 9%. The
“less than $20” and “more than $100” categories grew the
fastest year over year as the nonspenders dwindled. The
comfort zone for the largest single group of respondents was
the $20–$50 price range, as it was the previous year.
% of total
Maximum Amount that US Smartphone Owners
Would Be Comfortable Spending on a Holiday Gift
Purchase via Smartphone, 2011 & 2012
Note: 2011 n=205; 2012 n=1,000
Source: Mojiva, "Mobile Audience Guide (MAG)," Nov 13, 2012
2011 2012
$0
21%
$50-$100
20%
$100+
20%
<$20
8%
$20-$50
31%
$0
9%
$50-$100
21%
$100+
24%
<$20
12%
$20-$50
34%
147435
An August 2012 survey conducted by Research Now for mobile
marketing firm Vibes showed a similar breakdown in spending
patterns for “connected shoppers,” a subset of the 1,000
smartphone owners polled and defined as those who use a
smartphone to perform shopping-related tasks before, during
and after making a purchase. Nearly two-thirds of “connected
shoppers” said they had made a purchase with their phone, and
the largest group of buyers (44%) spent between $20 and $49.
Looking beyond spending preferences to average order values
shows basket sizes from smartphones defy the device’s
small screen.
For the first three quarters of 2012, average order values from
smartphones consistently outpaced desktop averages, according
to marketing technology firm Monetate.“The smartphone
audience is a smaller data set [compared to the desktop
audience] and it has a higher affluent element, so that’s why their
numbers are generally higher than traditional [desktop],” said Kurt
Heinemann, Monetate’s chief marketing officer.
Q3 2012 data from Monetate showed the average order value
for smartphone buyers was $97, which was roughly $6 higher
than the desktop average for the same period. However, it
was also $6 lower than the smartphone average from the
prior year. The decline in the smartphone average order value
over the 12 month period was likely due to the smartphone
audience growing larger and more economically diverse.
US Average Ecommerce Order Value, by Device,
Q3 2011-Q3 2012
Smartphone
Traditional
Tablet
Q3 2011
$104.11
$105.66
$100.76
Q4 2011
$119.74
$104.21
$106.05
Q1 2012
$104.28
$94.57
$96.29
Q2 2012
$96.90
$91.80
$96.37
Q3 2012
$97.82
$91.76
$69.84
Source: Monetate, "Ecommerce Quarterly EQ3 2012," Nov 16, 2012
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Top Retailers and Product Categories
A handful of companies and products tend to dominate the
mobile commerce landscape. According to Internet Retailer’s
“Mobile 400” report, mcommerce sales for the largest retail,
ticket and travel companies in the US totaled $10.8 billion
in 2012, up from $5.5 billion in 2011. Of that total, 39% was
accrued by 10 companies. Amazon topped the list with an
estimated $4 billion in mobile receipts; Apple followed with
$1.7 billion in sales of mobile apps, music, video and ebooks.
QVC and Wal-Mart were ranked fifth and sixth, respectively.
The remaining six companies were from the travel sector.
Meanwhile, eBay estimates its mobile transactions totaled
$10 billion in 2012, a number equal to the combined
mcommerce sales of the Mobile 400 companies, according to
Internet Retailer. It’s important to note, however, that eBay’s
estimate is for mobile transactions worldwide.
Wal-Mart and Apple appeared again in an October 2012
survey conducted by Equation Research for mobile solutions
provider Mobiquity. When the research firm asked 1,000
smartphone and tablet owners which retailers they purchased
from most using a smartphone within the past six months, the
largest group (23%) said they spent their money at Wal-Mart.
Equal shares of the smartphone spenders surveyed (14%) said
Target, Best Buy or Apple were their mobile stores of choice.
Brick Meets Click, which consults with clients on how technology
is influencing shopping, has found that retailers who succeed
with smartphone shoppers are the ones that use the device
to solve shoppers’ problems.“Successful retailers are more
shopper-centric and they tend to compete by moving more
quickly to serve shoppers vs. responding to competition. Some
are using mobile to help customers quickly find products in large
stores and others are saving shoppers time by letting them use
mobile devices to make purchases.They’re solving problems
rather than focusing on simply selling more products,” said Bill
Bishop, Bricks Meets Click’s chief architect.
Smartphone Shopping and Spending Trends

% of respondents
Retailers that US Smartphone Owners Browse and
Buy from Most on Their Smartphones, Nov 2012
Browse Buy
Wal-Mart 28% 23%
Target 22% 14%
Best Buy 21% 14%
Apple 15% 14%
Macy's 12% 10%
The Home Depot 15% 9%
Lowe's 12% 8%
Walgreens 11% 8%
Kohl's 11% 7%
Costco - 7%
CVS 9% -
Source: Mobiquity, "The Mobile Shopping Satisfaction Report" conducted
by Equation Research, Dec 12, 2012
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Drilling down to the product level shows smartphone sales
in 2012 stemmed mostly from digital products. In an August
15, 2012, blog post, Forrester reported that media products
dominated the mcommerce landscape and would continue to
lead the way in mobile sales over the next four years. Survey
results from online research firm uSamp support Forrester’s
assertion: Of 1,100 adult mobile device users polled in September,
the largest group of respondents (50%) said they had purchased
digital content with their mobile device. Beyond digital products,
roughly a third of those polled by uSamp reported buying
consumer electronics from a mobile storefront.
A pre-holiday survey conducted by mobile ad network
Mojiva showed smartphone owners were getting more
comfortable with the idea of buying physical goods with
their phones. Of the 1,000 smartphone owners surveyed by
Mojiva in September 2012, larger groups said they would
consider buying toys and games (56% vs. 52%) and clothing
(45% vs. 40%) with their phones compared to a similar
survey conducted in 2011. Indeed, the greatest number of
respondents said they were willing to buy “electronics” such
as movies and music, but growth in the other holiday gift
categories indicates smartphone owners were opening their
minds to a wider variety of mobile purchases.
% of respondents
Types of Holiday Items that US Smartphone Owners
Would Consider Purchasing on Their Smartphones,
2011 & 2012
Electronics (e.g., movies, music)
51%
60%
Toys & games
52%
56%
Clothing
40%
45%
Flights/hotels
27%
28%
Decorations
23%
24%
Food items
19%
20%
Charitable donations
17%
17%
None of the above
23%
17%
2011 2012
Note: 2011 n=205; 2012 n=1,000
Source: Mojiva, "Mobile Audience Guide (MAG)," Nov 13, 2012
147434
Is Smartphone Commerce a Man’s Game?
Research studies conducted among mobile users suggest
men are more avid mobile shoppers and buyers than women.
These findings are noteworthy given recent data from the
Pew Internet & American Life Project and from Arbitron and
Edison Research that showed smartphone ownership rates
among the two genders were nearly the same and that the
smartphone population as a whole was equally split between
men and women.
Still, results from a collection of surveys conducted in the lead-
up to the 2012 holiday season showed men were more inclined
to perform a wider variety of shopping-related tasks with a
smartphone than were their female counterparts.And they were
more likely to buy. uSamp’s September 2012 survey showed men
were more likely to scan a barcode, make a mobile payment,
make a purchase with the device and conduct post-purchase
activities such as commenting on and reviewing a purchase.
The only place where women outpaced men was in the hunt for
deals: 44% of female respondents to the uSamp survey said they
used a mobile coupon, vs. 35% of the men polled.

% of respondents in each group
Mobile Shopping Activities of US Mobile Device Users,
by Gender, Sep 2012
Scanned a barcode
91%
85%
Used mobile for payment
46%
32%
Made a mobile purchase
45%
34%
Used a mobile coupon
35%
44%
Commented on a purchase
35%
28%
Wrote a review of a purchase
26%
16%
Male Female
Source: uSamp as cited in company blog, Sep 12, 2012
145482
“The NRF 2012 Holiday Consumer Spending Survey” conducted
in October 2012 by research firm BIGinsight for The National
Retail Federation showed similar results. Of the 8,900 consumers
surveyed, more men than women said they intended to use
their smartphone to research products or compare prices and
to make purchases over the holidays. Men planned to use their
phone less than women for just two activities: to find store
information such as location or hours and to redeem coupons.
While men may not use mobile coupons as frequently as
women, they are more likely to use their smartphone to check
product information and compare prices in a store to get the
best deal. When interactive marketing agency Moosylvania
asked 1,800 smartphone users if they used their smartphone
in-store to compare prices, 80% of men said “yes” compared
to 67% of the female respondents.
Certainly, the gender mix will vary by retail category and
merchant, but in general, mobile shopping and buying activities
are more popular among men than women.“Our [desktop]
website is female-dominant, but on mobile we see more men
accessing our store,” said Zappos’ Iiada.This has implications for
marketers—not only those who target male consumers, but any
marketer interested in attracting more smartphone users to a
mobile storefront and more women to a physical store.
Commerce of Convenience (Almost)
For smartphone users, shopping trips are morphing
into shopping minutes. They occur at random times
throughout the day—from home and afar—and are
driven by impulse as often as intent. Curiosity piqued
by a television commercial can be instantly satisfied
with a smartphone search. And items from shopping
lists can be purchased while waiting in a doctor’s
office. By comparison, logging on to a computer at
home or at work feels like a time-consuming “trip”.
Yet many smartphone users still end up in front of
a PC or at a physical store because they encounter
roadblocks in the mobile checkout process.
Once a consumer owns a smartphone and they get a taste
of the type of information, deals and storefronts that are at
their fingertips, their reliance on the device ramps up rapidly.
Eighty-two percent of smartphone owners surveyed by mobile
marketing firm Vibes said their phone was “always or often”
within arm’s reach when shopping.And smartphone shoppers
surveyed by Deloitte in March 2012 reported using their phone
at least 50% of the time, either on the way to a store or in the
store itself.The frequency of usage was even higher, closer to
60%, for consumers who shopped in the following categories:
appliance/electronics, furniture/home furnishing, food/beverage
or health/personal care/drug.These high usage rates suggest
that smartphones are highly influential in the purchase process.
An Unbiased Shopping Resource
With internet access in hand and friends just a phone call, text
or tweet away, smartphone shoppers have a trusted source of
information at their disposal at all times.“People use their phone
instead of talking to a salesperson.A salesperson is trying to sell
them something, but their phone doesn’t have an agenda. It’s
unbiased, so they go to their phone to search for information,”
said Jack Philbin,Vibes’ co-founder, president and CEO.
And they frequently tap a variety of sources for research
purposes. Of the US smartphone and tablet owners
polled by Prosper Mobile Insights in August 2012, 88% of
respondents labeled themselves occasional or regular mobile
researchers. Another August survey, this one conducted by
email marketing provider Yesmail, showed that 64% of US
smartphone owners searched for product information on a
company’s website using their phone.
Finding product information is just one of a growing number
of research activities consumers do with their smartphones.
A survey conducted by MarketLive in the build-up to the 2012
holidays shed light on 10 shopping activities online shoppers

expected to do on their phone before visiting a store. The
two largest groups of respondents said they would use their
phones to check for sales and specials (42%) and to look for
competitive pricing on Amazon.com (41%). A slightly smaller
group (37%) said they would use their phone to browse an
online store for the product they were interested in.
Across the board, more consumers planned to use their
smartphone before entering the store during the 2012 holiday
season compared to the prior year. Interestingly, two new
activities garnered a significant number of responses: 30% of
respondents said they would look up prices on the retailer’s
own mobile site prior to visiting and 22% said they planned to
reserve products for pickup when they arrived at the store.
% of respondents
Mobile Activities US Online Shoppers Will Conduct on
Their Smartphones Before Visiting a Store This
Holiday Season, 2011 & 2012
Check for sales and specials
38%
42%
Look for competitive pricing on Amazon
35%
41%
Browse an online store for product of interest
33%
37%
Look up store information
30%
37%
Look for competitive prices on products at retailers online other
than Amazon
30%
35%
Check for product ratings and reviews
30%
33%
Look for competitive prices on comparison shopping engines
26%
30%
Check inventory of a product of interest prior to making a visit
to the store
25%
28%
Look up prices on the retailer's mobile site where I was
intending to buy
30%
Reserve products for subsequent pickup at retail store
22%
2011 2012
Note: "frequently" or "often"
Source: MarketLive, "Fa, La, Fa...30 Last Minute Tricks to Maximize Holiday
Selling," Oct 10, 2012
146620
Once in the aisle,the urge to comparison shop and find product
reviews kicked in.Forty-nine percent of US mobileWi-Fi users
polled by location-based platform provider JiWire used their
device to comparison shop in Q3 2012,up 10% from the prior year.
“Forty-eight percent of the connected shoppers we surveyed said
they felt better about their purchase when they used their phones
as a resource.So the more retailers can do to engage customers
with mobile touchpoints in the store,the better shot they have at
retaining their business,”saidVibes’ Philbin.
The habit of turning to the smartphone to gather information
during the discovery phase of the purchase process offers
marketers unique opportunities to influence buying decisions.
Nearly 30% of smartphone users polled in the first quarter
of 2012 for the “Our Mobile Planet: United States” study
commissioned by Google said research done on their
smartphone changed their decision to buy a product online, and
a slightly greater number said it changed their mind about buying
a product in a store. Marketers who embrace mobile researching
behavior as a sign of consumer malleability and deliver relevant
content—and offers of value—through mobile channels have a
better chance of converting a smartphone shopper into a buyer.
% of respondents
Inﬂuence of Smartphones on Purchase Decisions
According to US Smartphone Owners, Q1 2012
I intentionally have my smartphone with me to compare prices
and inform myself about products
35%
I have changed my mind about purchasing a product or service in
store as a result of information I gathered using my smartphone
32%
I have changed my mind about purchasing a product or service
online as a result of information I gathered using my smartphone
29%
Note: n=1,000
Source: Google, "Our Mobile Planet: United States" in partnership with
Ipsos MediaCT, May 1, 2012
149880
Empowered to Roam, but Still Shopping from Home
Indeed, consumers with smartphones can shop from anywhere
at anytime. However, the largest group of smartphone users (60%)
surveyed by Moosylvania said they were most likely to make a
purchase on their phone while at home.“The New Multi-Screen
World: Understanding Cross-Platform Consumer Behavior”
report published by Google in cooperation with research firm
Ipsos and Sterling Brands noted a similar preference for in-home
shopping.When 1,600 smartphone, PC and TV users were asked
to log their media interactions in a mobile diary over a 24-hour
period and were later surveyed about the behaviors noted in
the diaries, 60% reported shopping at home with a smartphone
while the remainder used the device to browse and buy products
outside the home. Compared to the number of respondents
who reported shopping out-of-home with a PC or laptop (16%),
smartphone users are wonderfully mobile. Still, home is the hub
of smartphone shopping.

% of total interactions
At-Home vs. Out-of-Home Shopping via Smartphone
and PC/Laptop According to US Connected Device
Users*, Q2 2012
Note: ﬁgures are based on 323 PC/laptop shopping interactions and 152
smartphone shopping interactions reported by users; out-of-home
represents on the go, in-store, at work or elsewhere; *use smartphone, PC
and TV
Source: Google and Sterling Brands, "The New Multi-Screen World:
Understanding Cross-Platform Consumer Behavior" conducted by Ipsos,
Aug 29, 2012
PC/laptop Smartphone
In-home
84%
Out-of-
home
16%
In-home
59%
Out-of-
home
41%
144876
Although smartphones are used steadily throughout the day,
usage spikes as the workday ends and consumers settle in
at home.With a smartphone,“You can shop in every waking
moment of the day, but we see a big burst in mobile shopping in
the evening hours,” said eBay’s Yankovich in an interview with
Fox Business News on November 20, 2012.A month prior to that,
an analysis conducted by mobile ad network Jumptap showed
iPhone usage spiked twice in the evening hours: between 4pm
and 8pm usage was 16% above the daily average and was 52%
above the daily average between 8pm and 12pm.
It’s no surprise the sweet spot for mobile shopping falls within
these time periods. USA Touchpoints, a syndicated consumer
insights and cross-platform research tool deployed by The
Media Behavioral Institute, showed the highest percentage
of mobile shopping occurred from 4pm to 8pm. During these
hours the average reach among mobile shoppers never
dropped below 8% and was as high as 13%.
Confident that consumers would turn to their smartphones
after dinner on Thanksgiving Day 2012, eBay started promoting
exclusive mobile deals at precisely 5:23pm—the time they
anticipated most US consumers would finish eating. “On a
holiday, when everyone is together, people talk about gift
ideas, so we wanted to provide a convenient way for them to
shop,” Yankovich said.
Mobile shopping is situational; there are times when shopping
with a smartphone just makes more sense than a laptop or
desktop, Yankovich added. “It’s not socially acceptable to
bring a computer to the Thanksgiving table, but people are
comfortable pulling out their phone.”
The comfort of the couch and the sound of theTV present another
situation that motivates smartphone users to shop.Sixty-five
percent of US smartphone users surveyed byVibes said they
had their smartphone within easy reach when watchingTV.And
roughly half that number (29%) shopped via their phone with the
TV on,according toABI Research.Interestingly,the smartphone
users polled by Moosylvania were more inclined to research
products with their smartphone while sitting in front of theTV (19%)
than when shopping in a store (12%).
shopkick, a mobile app that offers shoppers rewards for
walking into stores, noticed that its 4.5 million shoppers
were using the shopkick app from home at least six days a
month. To better serve these at-home shoppers, the company
redesigned the app so those who shopped at home could
earn additional “kicks” (reward currency) when they later
walked into the store. “The couch is now connected to the
store through the reward currency, and we see 51% of all
people who walk into a store have previously used the
shopkick app at home to prepare for that visit,” said Cyriac
Roeding, shopkick’s CEO and co-founder. “And engagement
on the couch is also leading to increased engagement in the
store. Walk-ins went up by 40% after we redesigned the app.”
Taken together with the data above, this example highlights the
opportunity for retailers to increase sales by using smartphones
as the link between home and the digital or physical storefront.
First Stop for Shopping, but Not Always the Last
Roughly two thirds of consumers who used multiple digital
devices in a day turned to their smartphone first to shop,
according to the Google/Ipsos “Multi-Screen World” report.
The smartphone won out again with other online activities
as well: Sixty-five percent of those polled in August 2012 said
they started online searches using their smartphone and 63%
reached for their smartphone first to browse the web. The
number who started these same activities using a laptop or
PC was significantly lower, between 25% and 30%.
% of respondents
Select Activities that Are Started on a Smartphone
and Continued on Other Devices According to US
Connected Device Users*, Q2 2012
Social networking
Searching for info
Shopping online
Browsing the internet
Managing ﬁnances
Watching an online video
Planning a trip
Started on
a smartphone
66%
65%
65%
63%
59%
56%
47%
Continued
on a PC
58%
60%
61%
58%
56%
48%
45%
Continued
on a tablet
8%
4%
4%
5%
3%
8%
3%
Note: read chart as 66% of connected device users have started social
networking on a smartphone before moving to another device, with 58%
using a PC and 8% using a tablet; numbers may not add up to total due to
rounding; *use smartphone, PC and TV and have started an activity on one
device then continued on another
Source: Google and Sterling Brands, "The New Multi-Screen World:
Understanding Cross-Platform Consumer Behavior" conducted by Ipsos,
Aug 29, 2012
144871

Still, most mobile retail apps and websites fall short of meeting
shoppers’ expectations and needs. Of the 65% of shoppers who
began shopping on their smartphone, nearly all of them moved to
their desktop or laptop to finish the task, according to the Google
and Sterling Brands study. Research conducted by comScore for
PayPal unearthed a similar behavior pattern, but the trend was
less amplified. Forty-four percent of consumers who started the
purchase process with their smartphone moved to a traditional
computer to complete the task, according to comScore’s survey
of smartphone and tablet owners.
Certainly, a higher degree of familiarity and comfort with
buying products in the more mature (and some believe more
secure) desktop environment plays a role in why smartphone
shoppers move to the larger screen in the end. However,
the lack of storefronts built for touch navigation is also a
contributing factor.
In worldwide survey of 889 in-house marketers, agencies,
vendors and consultants conducted by Econsultancy between
July and August 2012, only a third of respondents said that
they had designed a website specifically for mobile phones.
Granted, this number was up 40% compared to the research
firm’s 2011 survey, indicating that progress is being made.
However, the number is still out of proportion to the rapid
increase in smartphone usage for shopping-related activities.
Usability testing was also limited, according to respondents;
more than half (55%) of respondents said they had not yet
conducted usability tests to see how their content rendered
on mobile devices. While this was likely due to limited
resources dedicated to mobile, it means the majority of the
group was unaware of how their site rendered on a smaller
screen and how a potential shopper would navigate their
content with a fingertip instead of a mouse.
% of respondents
Companies Worldwide that Have Designed Their
Website Speciﬁcally for Mobile Phones or Tablets,
2011 & 2012
Mobile phones
25%
35%
Tablets
13%
23%
Neither
70%
61%
2011 2012
Note: 2011 n=307; 2012 n=337 client-side marketers
Source: Econsultancy, "Conversion Rate Optimization Report 2012"
sponsored by RedEye, Oct 31, 2012
147313
According to an annual mcommerce audit conducted by
The Acquity Group, US retailers are better prepared for
smartphone shoppers. The brand commerce and digital
marketing firm analyzed the mobile presence of the 300 top
retailers named by Internet Retailer and found that 95% had
a mobile-optimized website, an improvement of 157% over
the previous year’s survey. While this demonstrates significant
progress, the analysis also showed just half of the sites
rendered properly across the four leading mobile operating
systems—iOS, Android, RIM and Windows Mobile.
In addition, the time it takes mobile websites to load far exceeds
consumer expectations.According to a smartphone user study
conducted by Keynote Competitive Research in the first half
of 2012, 64% of smartphone users expected a mobile website
page to download in less than four seconds.Yet, the average
load times for mobile retail websites in the US hovered between
eight and nine seconds, according to Keynote’s mcommerce
performance index, which monitors the download speeds of the
homepages of 30 well-known retailers.
Indeed,businesses can’t control wireless data speeds,but by
building simple (and light) mobile websites they can shave seconds
off download times and increase user satisfaction levels.And if
smartphone shoppers are presented with finger-friendly navigation
and ordering methods,shopping carts are more likely to fill up.
The challenge then becomes understanding and managing
mobile shopping cart abandonment. In a survey conducted
in April 2012 by research firm Harris Interactive on behalf of
MasterCard, 63% of the 2,200 consumers polled said they had
abandoned a shopping cart when shopping online through
a computer or mobile device. Roughly a quarter said they
did so monthly. Looking specifically at mobile, shopping cart
recovery firm SeeWhy contends shopping cart abandonment
rates on mobile devices are substantially higher. “While the
average shopping cart abandonment rate across all devices
[tracked by SeeWhy] averaged 72 percent, on mobile devices
the rate has been 97% for the past year,” said Charles Nicholls,
SeeWhy’s founder and chief strategy officer.
Given smartphone owners’ tendency to use their smartphones
to fill downtime moments, their shopping behavior is
characterized by multiple starts and stops, which inherently
leads to cart abandonment. Pair that behavior with the
growing sophistication of consumers—the ease with which
they search for product/price information on their phone and
their knowledge that items in a cart will often be held there
in perpetuity—and it’s easy to see how cart abandonment is
becoming part of the shopping process.“Customers are getting
used to permanent shopping carts where the contents are
stored.They put items into carts simply because it makes it
easy to find them again later on,” Nicholls said.
The challenge for retailers is getting those customers to
return. Zappos noticed shoppers frequently used the mobile
shopping cart as a holding area for items they liked and hoped
to purchase. To remind customers of their previous shopping

sessions and to encourage them to return, Zappos added
badge functionality to its app. “It’s like the badge on the text
app that tells you the number of unread messages you have.
If a shopper adds three items to the shopping cart and closes
the app, the badge on the app will remind them they have
three items to take action on,” said Iida.
Indeed, behavior alone is not the cause of high abandonment
rates. Security concerns and the form factor of the mobile
storefront also play a part. “When it comes to making a
purchase, people feel most comfortable on a traditional
desktop/laptop, where they feel their information is safe. And
they may have auto-fill turned on [which facilitates ordering
through the desktop], so you’re going to end up with a
multidevice path to purchase, which is challenging,” Nicholls
said. With a nonlinear path to purchase that is navigated by
multiple devices, marketers need to take shopping sessions
on all devices into account when calculating conversion rates.
As creatures of convenience, consumers will inevitably turn to
the shopping channel that best fits their mood, the moment
and their environment. Multichannel shopping is a reality, and
as Walgreens has found, shoppers who engage with brands in
multiple channels are more valuable than those who use only
one channel. “We see the more channels we use to engage
with consumers and make it easier for them to shop, the
better the overall value. That’s demonstrated by our data that
shows customers who buy from us through multiple channels
are six times as valuable as those who came through just one
channel,” said Walgreens’ McCauley.
The key takeaway for marketers is to make shopping on a
smartphone as frictionless an experience as it is online and
in-store. Being the method many consumers turn to first to
shop, a satisfying smartphone experience not only has the
power to deliver a positive first impression, it could be a
lasting one as well—one that leaves a business poised to build
long-term, potentially lucrative, relationships with consumers.
Conclusions
Retail sales from mobile devices are beginning to
represent a significant portion of ecommerce sales.
eMarketer forecasts sales from mobile devices will reach
$38.4 billion in 2013 and represent 15% of ecommerce
sales. That share will increase to 24% in 2016, at which point
mcommerce sales will total $86.9 billion.
Smartphone commerce sales will grow by 81% between
2013 and 2016 as smartphone ownership escalates
and retail investments in mobile storefronts pay off.
The number of smartphone buyers is expected to increase at a
faster rate than smartphone shoppers. However, given the larger
base of smartphone users, the ratio of these two groups will
remain relatively unchanged through 2016. Smartphone buyers
will comprise 53% of the smartphone audience in 2016, up from
51% this year. In the long term, that “other half” represents a
significant opportunity for growth if marketers can improve site
performance and conversion methods.
The vast majority of mobile shoppers have a
smartphone within arms reach at all times, and for
many it will be the first device they’ll turn to for
shopping. A shopping spree could occur at any time and
in any place, but the majority of smartphone consumers
gravitate toward shopping at home between 4pm and 8pm.
Retailers like eBay are targeting promotions to arrive within
these prime shopping hours. And companies such as shopkick
are building a bridge between the couch and the physical
store by rewarding customers for using their smartphone at
home prior to visiting a shop in person.
Smartphone shoppers may start shopping on their
phone, but they often finish the task on a computer
or in a physical store. To some degree, this is a sign that
retailers have not yet met the expectations of smartphone
shoppers. These consumers habitually turn to their phone in
downtime moments and as a result, shopping sessions are not
continuous experiences. They are characterized by frequent
starts and stops. Retailers like Zappos that remind smartphone
shoppers of items left in the mobile shopping cart and that
make the phone the most convenient way to buy are winning
the favor of these consumers. Yet there will inevitably be times
when the most convenient way for smartphone shoppers to
seal the deal is via a computer or a visit to a store. The key
takeaway for retailers is to ensure the smartphone shopping
experience leaves a positive impression on consumers, as that
impression (good or bad) will be carried over to whichever
channel the consumer chooses to shop through next.

eMarketer Interviews
Zappos Describes Consumers’ Mcommerce
Shopping Patterns
Aki Iida
Head of Mobile
Zappos.com
Interview conducted on December 5, 2012
Walgreens Mobile App Satisfies Customers’ Need for Speed
Tim McCauley
Senior Director of Mcommerce
Walgreens
Redesigned Rewards App Shopkick Drives 40% More
Consumers into Stores
Cyriac Roeding
CEO and Co-Founder
shopkick
Bill Bishop
Chief Architect
Brick Meets Click
Interview conducted on November 29, 2012
Bridget Dolan
Vice President of Interactive Media
Sephora
Interview conducted December 18, 2012
Kurt Heinemann
Chief Marketing Officer
Monetate
Charles Nicholls
Founder and Chief Strategy Officer
SeeWhy
Jack Philbin
Co-Founder, President and CEO
Vibes
Related eMarketer Reports
Tablet Shopping Fuels ‘Couch and Pillow’ Commerce
Multichannel Customer Service: Best Practices for
Building Retail Loyalty
Related Links
ABI Research
Arbitron
The Acquity Group
BIGinsight
comScore
Deloitte
Econsultancy
Edison Research
Equation Research
Forrester
Google
Harris Interactive
Internet Retailer
IBM
Ipsos
Javelin Strategy and Research
JiWire
Jumptap
Keynote
MarketLive
Media Behavioral Institute
Mobiquity
Mojiva
Monetate
Moosylvania
Nielsen
National Retail Federation
Pew Internet and American Life Project
Prosper Mobile Insights
Research Now
SeeWhy
Sterling Brands
Telmetrics
TNS Infratest
uSamp
Vibes
Yesmail
xAd
Editorial and
Production Contributors
Nicole Perrin Associate Editorial Director
Cliff Annicelli Senior Copy Editor
Emily Adler Copy Editor
Dana Hill Director of Production
Joanne DiCamillo Senior Production Artist
Stephanie Gehrsitz Senior Production Artist
Allie Smith Director of Charts

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