Mobile Commerce: Tapping the Untethered Market

There's no doubt that mobile-commerce — buying, selling and advertising on wireless devices — is a growing industry. According to the Resource4Business report Future of M-Commerce, Outlook 2007 to 2013, USA, "This segment, once again is gearing up for unprecedented growth due to advancement in wireless broadband technologies, as well as emergence of innovative applications, business models and cheaper but powerful handsets. These new trends, with emergence of new technologies and players, are changing the industry landscape and creating many new and exciting opportunities in existing as well as unexplored market segments."

And, a poll of 500 cell phone users conducted last April by AuthenTec found that 58 percent of those surveyed would purchase a phone with m-commerce, wireless banking and biometric security features, 47 percent would consider switching service providers to do so and nearly one-third would pay an additional $20 to $50 more to upgrade to a phone with such capabilities. Other key results showed that 43 percent would use a cell phone to purchase items from a store, 40 percent would conduct wireless banking and 37 percent would buy books or music.

So it's no surprise that each day brings news of another major player jumping into the mix. For instance, last month mdog.com announced the additions of eBay, craigslist, Wikipedia, Citysearch and MySpace to the catalog of its mobile-accessible Web sites. To use the free service, you simply point a mobile browser to mdog.com, select the "Web" tab, and choose among the Auctions, Information, Entertainment or Social categories.

In the case of eBay, mdog.com displays auction searches in complete detail and even allows users to submit secure, real-time mobile bids from wherever they are. This is good news for sellers, says Keith Gerard, president of mdog.com. "It's all automatically available to shoppers, so sellers don't have to do anything, because we're accessing the actual eBay site, it's seamless," he said. "We do the SSL interface and all that." There's no doubt that mobile-commerce — buying, selling and advertising on wireless devices — is a growing industry. According to the Resource4Business report Future of M-Commerce, Outlook 2007 to 2013, USA, "This segment, once again is gearing up for unprecedented growth due to advancement in wireless broadband technologies, as well as emergence of innovative applications, business models and cheaper but powerful handsets. These new trends, with emergence of new technologies and players, are changing the industry landscape and creating many new and exciting opportunities in existing as well as unexplored market segments."

Selling Time-Sensitive Stuff With No Searching
But, is selling on the mobile Web a prudent thing to do for your particular online business? Well, it depends, says Gerard. If you're selling something time-sensitive to someone who already knows what they want, the mobile experience works.

"Not everything is appropriate for mobile. First, people won't search on a cell phone, so you have to sell to buyers who already know what they want. And, if you have the best marmalade, your site will do well because you can't get it just anywhere and you'll get repeat customers, but you wouldn't sell on a cell phone because people are in front of their computers a lot and will just buy from the Internet," he says. "Ebay is a different story because if you're bidding, you know exactly what you want and then it's about accessibility, that's where the holy grail is right now in mobile commerce."

Creating a Mobile Site
If you think your products are ready for mobile commerce, you should consider using a variety of online tools to create a separate site that will work properly — one with minimal multimedia and that can be accessed without doing a lot of typing.

There are several companies that will help you create a mobile Web site, including Winksite, Mobizcard and Mobisitegalore, which is free service (donations accepted, however). When publishing a mobile site, you should check to see if the site creator produces pages that comply to mobile commerce standards, namely the Device Independent Authoring Language (DIAL). Complying with standards means you have a better chance that your site can be viewed on a wide range of devices.

Fortunately, most mobile sites can be stored on the same server that holds your Web site, with most hosting providers allowing you to create a subdomain that directs to folders on the server. Likewise, your merchant account should work with your mobile site as well.

In terms of security, Gerard warns that not all mobile devices support SSL, though a security protocol called Wireless Transport Layer Security is used by companies such as Entrust (entrust.net) to protect wireless transactions.

In addition, services such as PayPal Mobile, whereby you can use your cell phone to make PayPal payments to virtually anyone with a phone number, as well as purchase anything you see bearing a PayPal "Text to Buy" label, will soon turn one-year-old.

Other lesser known companies, such as Cyphermint Inc., are also rolling out new payment-protection initiatives. Cyphermint's PayCash Mobile lets people pay bills and make purchases on wireless devices and, the company says, can be securely linked to a consumer's credit, debit, gift card or bank account.

Using Voice to Go Wireless
For those who want to go mobile, but don't want to create an optimized site or bother with payment protocols, there's UnWired Buyer, a service that uses the telephone as an "interactive voice alert platform and real-time channel for the Internet," says CEO Indy Gill. The company's first application is UnWired Buyer for eBay, which allows users to remotely bid in the final three minutes of an eBay auction.

Since October 2005, UnWired Buyer delivered more than 300,000 calls to eBay shoppers and interacted with 1 million eBay auctions. Here's how the free service works: Three minutes before the item closes, UnWired Buyer places a live phone call to you. You must enter in your PIN number to authenticate the call. You are then able to bid using simple touch tone commands on your mobile phone, get real-time updates, bidder status, automatic price updates. and your call is counted down to the end of the auction.

For sellers, it provides the chance to bring more customers to auctions in the closing minutes, therefore driving more bids. The service is free because eBay compensates the company for each winning bid placed through UnWired Buyer, similar to an affiliate program model.

Another bonus for sellers is a new ad model that UnWired Buyer is currently testing, in which alert calls offer promotions for other eBay merchandise, based on the types of auctions the person participates in. For instance, if you bid on shoes, the next alert you receive will advertise an offer to get a discount on shoes or a pair of earrings with a purchase, says Gill.

"We've had 40,000 people take calls with ads on them since December and not one single person has complained," said Gill. "In fact, we are getting a 14 percent 'click through' rate, meaning they push one on the phone to get more information, and in more narrowly targeted ads, as much as 19 percent."

In other mobile advertising news, Yahoo on Monday launched a mobile ad platform in 19 countries, a service first offered in the states in November, that allows companies to post interactive ads on the Yahoo Mobile Web home page.

Analysts are also studying the potential for m-commerce promotions, with JupiterResearch issuing a report Jan. 29 stating that while consumer adoption of mobile coupons is minimal, interest is high enough to justify adding them to your promotional campaign.

A summary of the report states, "Utilizing cell phones as a platform to reach consumers with mobile coupons offer many benefits to advertisers including notification of time-of-day and day-of-week redemption, instant delivery, geo-targeting, time-of-day targeting, forward-to-a-friend features, higher redemption rates due to stringent opt-in requirements, and a buzz factor given the newness of the medium."

In the end, mobile commerce may not be reaping huge profits for online sellers today, but you'll want to be ready for it when that day comes. And at the pace that the technology, standards and market is maturing, the pay-off may not be as far off as you think.

Michelle Megna is managing editor of ECommerce-Guide.com.

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