Monday, December 08, 2014

Mobile Takeover of Total Spend = a Question of When

According to Shop.org executive director Vicki Cantrell, “Retailers have to continue to invest to make sure they get their mobile offerings right, or will increasingly risk alienating customers and leaving significant money on the table.”  Regarding online purchases, the following breakdown shows shoppers making at least one purchase online in Q2 2013:

69% of desktop shoppers
34% of tablet shoppers
21% of smartphone shoppers

The top reason consumers visit sites is to price compare and look for any online discounts. The comScore mobile commerce report also shows that smartphone users use it for the following:

35% for store location
24% to find coupons and deals
19% to look up product availability

In terms of categories, apparel and accessories (37%) and event tickets (25%) were among the top products of smartphone shoppers.

The big difference in between time spent and sales is that smartphones are used for research still. Tablet shoppers spend 18% more. Conversion rate is also lower in for smartphone shoppers 0.92% vs. tablet shoppers. Nevertheless, desktop search will be declining (Google spend will drop to 66% from 76%) as Google mobile paid clicks will soon take over (rise to 1/3 of all spend).  eMarketer estimates that desktop search ad spending will fall to $1.4 billion in 2014, a drop of 9.4% from last year. Mobile search, however, will increase 82% with total mobile search up to $9 billion (vs. desktop search of $14bn).  Key contributors to this growth include Enhanced Campaigns and Product Listing Ads (PLAs), both of which contributed to increased click share on mobile throughout 2013 and will continue to grow.

As more consumers spend time on mobile phones and tablets, advertisers are quickly to adjust as well. They are playing catchup with new consumer habits and user behaviors to boost up the current average low single digit mobile spend budgets. Soon the advertisers will be expected to shift the majority of their spending and search dollars toward mobile. It’s just a question of how soon. 


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