Mobile payments increase online sales and revenue
If you sell goods or services online you’re already part of the e-commerce industry, but if you don’t have m-commerce solutions integrated into your digital store, you could be losing significant sales and revenue.
Here’s everything you need to know about m-commerce and mobile payments:
What are mobile payments?
In the simplest terms, m-commerce is the act of researching, browsing and buying products or services online using mobile devices and it works best when a site is optimised and responsively designed for them.
Although consumers have been able to find and compare products with smartphones for some time, mobile payment purchasing is the final step in converting mobile browsers into buyers.
There are three key methods of mobile payment that can enhance e-commerce:
Premium SMS/MMS:
These kinds of mobile payment enable retailers to bill consumers for real or virtual goods or services via their mobile network provider.
Wireless Application Protocol (WAP):
WAP enables consumers to connect to the internet on a mobile device and use any online payment method supported by an e-retailer, such as Paypal, credit and/or debit cards or bank transfer.
Mobile Apps and Wallets:
Bank or merchant store Apps and mobile wallets such as Realex Payments, Paypal, Google Wallet or Apple Pay provide consumers with a more satisfying instore or online shopping experience by integrating mobile payment services with marketing tools such as loyalty rewards or coupons.
Starbucks are a great example of how mobile payments, when used as part of a wider digital strategy can drive growth. In July, the coffee retailer announced that 20% of all their business transactions were now made via their mobile payment App, which contributed to their significant increase in year-on-year revenues of almost $18 million.
Advantages for e-commerce:
For the consumer, mobile payments are convenient and efficient and the last logical step in locating, accessing and buying from mobile-friendly websites on the move.
The freedom to purchase goods or services from anywhere at any time is particularly desirable among young, web-savvy consumers who trust technology, have expendable incomes and are less preoccupied with the privacy and security of their data than their older counterparts.
If you have an e-commerce store, mobile payment gateways give your customers a quick, smooth and easy buying experience which contributes to increased spending, repeat purchasing and brand loyalty.
As Realex, our Magento service partners’ report, when e-commerce sites are built with inadequate or outdated mobile payment facilities, up to 72% of shoppers will abandon their shopping carts before completing a purchase.
To run a successful e-commerce operation, “Mobile commerce is no longer something you must cater for as an afterthought. It must be rooted in the design of your store.”
Growth of the market:
As a digital retailer, you can enjoy the same benefits that mobile payment processing gives your customers in terms of convenience and efficiency, but you can also enjoy the increased sales and revenue that mobile payments generate; much like contactless card payments, mobile payments facilitate impulse buying and increased expenditure.
According to Mastercard, in 2012 when contactless payments where introduced, they generated an average 30% increase in expenditure. E-commerce retailers enjoyed an increase of 8.8-33.3% in revenue and an 11.8-28.5% increase in the number of customers authorising repeat payments.
Since then the contactless and mobile payment market has flourished. Mobile phone payments now account for 28.7% of all global transactions made and the UK is the industry’s market leader.
With an average spend of £51 per transaction, “44.8% of all online payments in the UK were made using a mobile device” in Q2 of 2015, and Visa anticipate that as more e-retailers adopt the technology and more consumers become familiar with and trust it, m-commerce could account for £1.2bn in sales every week in Britain within the next five years.
Is your e-commerce website ready to capitalise on this rapidly growing market?
To find out more about how you can maximise the sales and revenue of your online store with m-commerce and mobile payments, contact the team here at Yoma.
