Millennial and older generations can probably remember a time when the mention of eCommerce would have drawn blank stares from all corners of the room. However, today there is hardly a self respecting Internet user who hasn’t come across a particularly good deal on the Internet, and hastened to make purchase. Interestingly enough, a new paradigm shift is taking place even as we speak, and eCommerce is rapidly giving way to a completely new phenomenon – mCommerce.
Smartphones have certainly become the dominant medium of accessing the Internet over the past few years. Gone are the days when you needed a bulky desktop, or a personal computer to access the Internet. Today’s smartphones are slim, powerful, pack huge battery backups and if they are large, it is only to accommodate their high definition displays. Expectedly, this improvement in the devices themselves have also sparked off an increase in usage — particularly with regards to accessing the web. Indeed, it can be argued the smartphones now find more usage to access the web as compared to making calls.
While comparing net Internet access, smartphones clearly emerge as the winners. In late 2016, mobile Internet usage crossed desktop Internet usage for the first time. And the trend shows no signs of reversing.
The trend has also affected eCommerce, although the effects have been rather convoluted. Instead of a simple and proportional increase in visits and sales through mobile, there is a disparity in the increase between the two. While visits to eCommerce platforms through mobile have skyrocketed, sales are showing a more moderate increase. This could be attributed to the fact that being handier and omnipresent, smartphones provide users with better opportunities to access the web. However. users are still somewhat more comfortable conducting their financial transactions over desktops.
Mobiles for browsing, desktops for purchases:
However, online retail as a percentage of total retail still has plenty of room to grow. As per data, 2016 saw eCommerce form around 12 percent of the total retail sales. Of course, this table is made up of data from many different sources and as such, is pretty disparate. However, it does serve to give you a look at the bigger picture. Retail sales stood at somewhere around $3.375 trillion as compared to around $394.86 billion worth of items sold across the net. So you see, online retail has plenty of room to stretch its legs. And as it grows, so will mCommerce, and at a faster clip.
The one reason why mCommerce has not already overtaken eCommerce with regards to sales, is the fact that people are much more comfortable performing transactions from personal computers as opposed to mobiles. Hence, while people will happily pore over different types of products over their mobile phones while in the Subway, or while having a coffee at the local Starbucks, they are much more likely to make a purchase after they come back home and open up their Macbooks. Indeed, the phenomenon of browsing for products while in a showroom already has a name — web-rooming — and for reasons best known to itself, Amazon has obtained a patent against it.
However, we can expect this trend to change as mobile technologies become more secure, and people become more comfortable with the idea of using their smartphones to make payments. And with the advent of technologies like QR-code scan to pay, the time may well come sooner rather than later.
Surge in eCommerce driving entrepreneurship:
The surge in eCommerce is also leading to a wave in entrepreneurship. Consider platforms like Shopify, which have made it possible for anyone and everyone to become an entrepreneur and open up a well managed shop. At the last count, there were over 500,000 Shopify stores across the web. And while not all of these stores are generating substantial revenues, a surprising number of them actually are — which again goes to show the huge scope for entrepreneurship in eCommerce, despite the dominance of market leaders like Flipkart and Amazon. And while these behemoths have made their name by an extreme diversifying of their products, the new generation stores are making theirs by obsessively fixating upon a particular niche.
So suddenly, we have a popular clothing store that sell T-shirts, and not just any T-shirts but Goth themed ones, or another store selling Pokemon themed hats and so on. And while these stores may not have hundreds of millions of visitors per month, they do have a pretty loyal following. Of course, a significant portion of credit goes to companies like Shopify, and technologies like Magento, that have made opening powerful eCommerce stores practically easy. Then there are companies like MageNative working to bring mCommerce on par as well, making it extremely easy for eCommerce stores to get a mobile application.
Having a mobile app gives these eCommerce stores access to some of the most valuable real estate on the planet — a couple of inches on their customer’s mobile screen. And it also allows them to gain deeper analytics and insights. leading to well-aimed products delivered via push notifications.
Finally, technologies like Augmented Reality also promise to bring about a paradigm shift in the way we shop. Imagine thinking about buying a new coffee table and being able to see exactly how it looks in your drawing room simply by firing up your camera. There are companies working on this very technology, and some of them have even started implementing it.
In short, eCommerce is the future and very soon, we may find ourselves ordering everything through our smartphones. As far as the entrepreneurial opportunities such a massive shift will bring are concerned, that I leave for you to mull over.