Mobile phones to be ‘fourth channel’ for retailers

5 Jun 2008

Mobile phones are quickly joining physical stores, websites and catalogues as an important retail channel, a new study by Cisco has found.

The company’s third annual e-commerce study suggests that mobile devices represent a major growth opportunity for the retail industry and will become a ‘fourth channel’ for revenue.

This new channel is being bolstered by the rise of social networking and advanced mobile technologies, which have redefined the online experience and is enabling retailers to capture new sources or revenue by implementing mobile strategies.

The study showed that 42pc of retailers surveyed provide the ability to view product information on a mobile device through reformatted webpages or specific mobile pages.

Some 15pc offer the ability to purchase or complete inventory queries via mobile handsets, while 10pc are using SMS to provide information or answers to customers’ queries.

Some 6pc have webpages and a URL specifically designed for mobile use.

“Mobile presents a revenue opportunity for retailers and opens up a new era of multichannel retail,” said Dick Cantwell, vice-president of IBSG’s Retail/CPG Practice.

“Multichannel retailing has morphed into a web of shopper touchpoints across stores, catalogs, mobile devices and the internet. Retailers must start offering shoppers an ‘interconnected shop’ if they are to take advantage of the mobile opportunity.”

The Cisco IBSG study assessed 45 retailers from North America and Europe.

The study found that the top 10 overall e-commerce sites, from first to tenth, were, Best Buy, Sears, Circuit City, Quelle, Otto, Macy’s, FNAC, and Argos Home Retail Group.

Forrester Research estimates that online sales will reach US$204bn in 2008 and US$335bn by 2012. E-commerce accounts for 6pc of all retail sales in the US.

New technologies and capabilities such as mobile access can help retailers get the edge on the competition, Cisco said, as customers will soon expect to use their mobile devices to find stores, research products, make purchases and manage their accounts.

The company noted there are three times as many mobile phone subscribers (3.3 billion) as internet users (1.3 billion) worldwide.

The Cisco study found that 17pc of e-commerce sites analysed provide the capability to connect to some social networking communities, 52pc provide customer reviews for products, 50pc had advanced visualisation tools, 50pc provide multimedia such as video and 50pc offer customer support through multiple channels, such as click-to-chat.

By Niall Byrne