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BizReport : Mobile Marketing : October 20, 2011

M-commerce spend rising, payment methods frustrate consumers

Interest in m-commerce is increasing from both consumers and retailers. A new report by Barclays Corporate shows consumer spending on mobile phones and tablets in the UK will rise significantly over the next few years although other research reveals consumer frustrations with mobile payment methods.

by Helen Leggatt

By 2016 British consumer spending on mobile devices is forecast to increase by a healthy 55%, according to research by Barclays Corporate. By 2021 that spend will increase to over $30.4billion, or 4.9% of total retail sales, compared to the $2billion spent this year.

"M-commerce is still a relatively niche channel accounting for 0.5% of total retail spend," said Richard Lowe, Head of Retail and Wholesale at Barclays Corporate. "However, with little new shop space coming into play the real growth opportunities lie on the virtual high street and those retailers which are prepared to invest will be at a significant advantage to the competition."

However, when it comes to making payments by mobile consumers remain frustrated with the process and the choices currently available to them. A survey by Consensus for WorldPay found the top frustration is lengthy payment processes (39%) followed by the amount of information required to be entered (38%).

Other frustrations include websites that are not optimized for mobile use (31%), acceptance of preferred payment method (17%), and no app being available (9%).

The preferred method of payment among consumers was found to be eWallets (63%) rather than credit cards (37%) or even payments through a mobile phone network (14%).

"We also uncovered a community of shoppers who prefer to use mobile devices ahead of a desktop or a laptop - which was really unexpected," said Gabriel Hopkins, Head of eCommerce Products at WorldPay. "We saw the importance of convenience across the survey with shoppers showing a clear preference for eWallets and a simple checkout experience."

According to the latest British Retail Consortium and Google Online Retail Monitor, mobile is driving up retail searches and now accounts for 10% of all retail searches. Mobile search volumes have increased 168% year on year in Q3 while retail searches on desktop rose by 35%.

Tags: consumer insight, ecommerce, eWallet, m-commerce, mobile marketing, mobile payments, mobile shopping

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