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Conveniences may trump deals when it comes to mobile commerce

Apr 01, 2013 Dave King

Conveniences may trump deals when it comes to mobile commerce

Many merchants who already accept electronic payments technologies such as credit, debit and ACH cards are looking to expand their customers' transactional options in the near future. One direction that these retailers are likely to go is to adopt a system for accepting mobile purchases. As the popularity of smartphones and tablets continues to grow, more consumers are looking at the devices in their pockets and handbags as vehicles for shopping. While there are a number of reasons for this trend, one of the big ones may not be price.

Why use mobile payments?

In order to construct an effective strategy for deploying a mobile payments system, merchants need to become aware of the motivations behind this kind of commerce. According to Mobile Commerce Daily, while many retailers believe that shoppers are drawn in by the potential to take advantage of big deals, this assumption may not paint an entirely accurate picture of the reality.

"The tremendous, triple-digit growth of mobile commerce in the last few years cannot be explained by price alone," Mitch Bishop, chief marketing officer at Moovweb in San Francisco, told the source. "Yes, consumers use their mobile devices to be better informed shoppers, but the sheer volume and growth of mobile commerce has to be more about convenience."

The news provider explained that convenience and price are often linked, and that a good way for retailers to strike an effective balance is to analyze the data they're gathering from their mobile payments solutions. This way, companies can determine what their audience wants, including how these desires may vary by demographic. Convenience is multi-faceted, and its meaning may differ among consumers. While many prioritize the the ease of navigating a website, others may be more partial to tools that speed up the process by offering targeted offers, saving them time searching for the right items. Price plays in to the equation, as reasonable prices and coupon offers - again, for items their purchase data suggests they may want - can reduce the hours they spend comparison shopping. Once merchants figure out that they must offer benefits in addition to savings, they will be able to begin crafting a program that actually works.

Online retailer Amazon, which does offer mobile payment apps, is one of the biggest proponents of this theory of convenience. The Technology Review interviewed Sam Hall, Amazon's vice president of mobile shopping, about his thoughts on the matter, who said he wants to enable consumers to go from wanting an item to making a purchase in under 30 seconds. Hall told the news provider that he believes this is what today's customers want - a transaction process that is nearly instant. In order to achieve this, the online retailer has released numerous tools to simplify online and mobile commerce, including making sure pages load quickly and making input easier via suggestions when users begin to type an item into the search bar.

Is convenience dangerous?
One natural consideration may be whether convenience is the best thing for consumers. If individuals are able to use their mobile devices to make any purchase they want in less than a minute, many may find themselves in financial trouble. Not only are mobile payments still being eyed as a possible safety risk, especially in cases where vendors and retailers don't take adequate steps toward data security, but the ability to connect a credit card with advanced payment technology may lead to overspending. Retailers do have a stake in their patrons' consumer credit reports, as those with poor credit may be less likely to shop. It could be beneficial for merchants and developers to not only offer convenience, but to integrate technologies into mobile payments apps that also serve money management purposes.