Many people have been waiting for the new iPhone 5, (including myself, stuck with a Jurassic era 3GS), so you may be disappointed with the more minor upgrade announced yesterday in the form of the new iPhone 4S. Disappointed or not, the iPhone 4S looks likely to sell by the truckload. After all, people said the iPhone 4 was disappointing, yet it sold an astonishing 1.7 million handsets in just three days after its June 2010 release.
But what does the iPhone 4S mean for mobile commerce? A raft of new features have upgraded the old 4, and while you might think these are just nice-to-haves, there are two new features, which in combination, have the potential to make mobile commerce significantly easier than before.
First, the three main problems with trying to make an online purchase with an existing smart phone can be summarized as follows:
Small Screen – The physical size of a smartphone screen makes entering personal data, such as delivery details, a major chore, sufficient to deter many purchasers.
Download speeds – downloading product category pages with 30 or more images can be so painful that many mobile visitors will bail. This problem is gradually being addressed as merchants roll out mobile optimized sites, but it is a still a very real issue.
Payments – Payment methods have not yet caught up with developments in handsets. Entering payment data onto a smartphone is possible, but a long way from easy. While all the major payment companies and a host of new ones are working on mobile payments, they’re not quite there yet.
So how does the iPhone 4S help address these issues?
A5 Processor & faster download speeds
Apple claims that the 4S has up to two times more processor speed and up to seven times faster graphics due to its dual core A5 chip. (…)
Each year, thousands of eCommerce and retail folks shuffle through the EXPO halls and attend the panel discussions of the Shop.org Annual Summit, one of the best retail conventions of the year. With over 4,000 attendees, 2011 was possibly the biggest Summit to date. The content at Shop.org summit is always packed with great practical tips, advice and the opportunity to network with experts from different fields. You can see a summary of this year’s event, including many of the presentations here.
And after passing out around 500 mini-shopping carts to our booth visitors, watching over 350 people squeeze in to attend The Science of Shopping Cart Optimization panel, and handing over $1,000 for the recovery of our abandoned gold mini-shopping cart, there’s no doubt that it was a big event for us at SeeWhy!
For starters, our very own Charles Nicholls, founder and CSO, made top news on the Shop.org blog with new research on shopping cart abandonment he presented to a full house during The Science of Shopping Cart Optimization panel on Tuesday the 13th. The SeeWhy Conversion Academy research team analyzed more than 600,000 individuals and 250,000 transactions in the largest study of its kind. Charles said “We traditionally think of shopping cart abandonment as being a bad thing. We now know that this is not true. For many buyers, and for many types of purchases, it is an integral part of the buying process.”
There are clear pros and cons of selling on Amazon. The Harry Potter franchise of e-books has recognized this and will not be depending on Amazon. Author JK Rowling has teamed up with Sony to launch a direct outlet, called PotterMore.
If you’re in the ecommerce business, and have ambition, then perhaps like JK Rowling, you shouldn’t sell on Amazon. But if your ecommerce business is funding your lifestyle, and you have no great ambition to change the world, then Amazon could be an important channel for you.
This distinction is important: It’s essentially asking the age-old question about your business, ‘Who do you want to be when you grow up?’ If your ambition is large, then Amazon is not for you. If you merely want to make enough money to pay the bills each month, then it could be good; but go into it with your eyes open because you’re hitching a ride on the back of a 90-pound gorilla.
Amazon’s strategy is to focus on three core values: selection, price and convenience. It strives to offer the widest possible selection, at the best price, with the easiest repeat shopping experience. Other merchants fit into this strategy only so far as they help Amazon to offer a wider selection of products.
Every customer on Amazon has registered; you can’t buy without first registering. It views the merchant almost as an affiliate — a source of new customers — based on product selection. So a search by a new visitor for a product that Amazon doesn’t sell — which results in a sale through the merchant — means that Amazon has acquired a new customer. But having captured the customer, Amazon’s model is to drive to repeat sales, and it will relentlessly sell the whole range of its products, not yours. (…)
The shopping cart abandonment rate has increased to 75% in the first 6 months of 2011. The rate, which averaged 71% for 2010, measures the proportion of online shopping carts that are started, and then abandoned.
Normal seasonal trends have the rate decreasing in the first half of the year, declining further over the summer months, then spiking in anticipation of holiday promotions being rolled out.
Once the holiday promotions are widely available, the rate declines again as shoppers make their holiday purchases online in volume.
Causes of the increase
There continues to be considerable economic uncertainty, and while ecommerce is faring better than many sectors, there’s no doubt that many consumers are cautious in their approach and are looking for the ecommerce channel to reduce costs. While convenience still drives many purchases, price sensitivity is increasingly playing a role, leading consumers to research purchases more.
Increasing customer sophistication
A recent Forrester study concluded that 89% of consumers had abandoned at least one shopping cart. Cart abandoners are more experienced and have been using the internet longer, and spend more online than consumers that don’t abandon. As ecommerce has become a mainstream activity of many consumers, so too has the general level of sophistication, with the consequence that many consumers will routinely comparison shop for the best price. The Forrester study showed that 27% of abandoners had abandoned a shopping cart in order to comparison shop on other sites.
Mobile devices pushing up the abandonment rate
Ecommerce purchases on mobile devices are forecast to be 3% of the overall online commerce market in 2011; however the abandonment rate on mobile devices is significantly higher than on tablets or PCs. While the overall impact of mobile shopping is currently small, it is becoming a factor that we will see more of going forward.
There is a massive need to share results and best practices, since this is still an area which is not widely understood. As such, I welcome all research into shopping cart abandonment and recovery emails.
So it was with some eager anticipation that I read Epsilon’s Abandoned shopping cart email strategies report. Unfortunately, when analyzing their results for the best time to send shopping cart recovery emails, Epsilon confused common practice with best practice:
“Typically 48 to 72 hours is optimal for abandoned shopping cart emails; anything sooner may seem too intrusive. Follow-up emails beyond the three-day mark may be too late to convert a potential buyer.”
This is pure speculation – in fact Epsilon’s own research doesn’t support this. What the research shows is that there is a distribution on send times for abandoned shopping cart emails ranging from the same day to more than a week. Most retailers who send abandoned shopping cart emails do so between 48 and 72 hours.
While this is the most common send time, it doesn’t make it the best practice. Best practice is a term often mis-used, so here is an example of what I mean:
“Just because lemmings are jumping off a cliff, it doesn’t mean that we should all do the same.”
Let me clearly state that sending a real time shopping cart abandonment email is ‘best practice.’
In this case, best practice is based on multiple independent studies including one from Forrester, two separate MIT studies and a Marketing Experiments test. Each of these studies have concluded that real time responses work better.
SeeWhy, using our A/B testing module, has shown on multiple tests for customers that the same email will perform significantly better when sent in real time. Open rates, click-throughs and conversion rates are all higher when shopping cart abandonment emails are sent in real time. (…)