Mobile Retail Explodes - Phones And Tablets Are Driving One-Fourth Of All E-Commerce

Advertisement

Welcome to our new E-Commerce Insights newsletter, a morning email with the top news and analysis on the e-commerce industry, produced by BI Intelligence.

Advertisement

Click here to sign up for E-Commerce Insights today, and receive it every morning in your inbox.


MOBILE RETAIL SALES IN THE U.S. REACH $60 BILLION: Mobile retail spending in the U.S. increased 188% in 2013 to $59.7 billion, according to a new report from research firm Javelin. The U.S. Census reported that online retail sales topped $263 billion last year, meaning mobile shopping accounted for roughly 23% or nearly one-fourth of all e-commerce dollars.

Complimentary Tech Event
Transform talent with learning that works
Capability development is critical for businesses who want to push the envelope of innovation.Discover how business leaders are strategizing around building talent capabilities and empowering employee transformation.Know More

TABLET SPENDING SURGES: Slightly more than half of mobile retail spending occurred via tablets, growing 463% to $28.7 billion. This was driven by rising device ownership and aging millennials who are accustomed to navigating the mobile Web and apps and now have more money. This trend indicates that retailers should be offering tablet-optimized browser and app experiences, if they are not already.

Furthermore, retailers also need to be aware that consumer habits vary by mobile platform. Two-thirds of iOS smartphone owners made a purchase on their device last year, compared to roughly one-half of Android smartphone owners who did so. (Javelin Strategy & Research)

Advertisement

EUROPEAN E-COMMERCE FORECAST: Meanwhile, total e-commerce sales in Europe are expected to grow 18% to $216 billion in 2014, according to the Centre for Retail Research, and RetailMeNot. It's important to note that the only countries included in the forecast were the UK, Germany, France, Spain, Netherlands, Italy, Sweden, and Monaco. Those countries have a combined 175 million consumers who shopped online last year, which is more than the U.S. (171 million). And, although Americans still spent more online last year, topping $264 million, the European e-commerce market is expected to grow faster than the U.S.'s in 2014. This represents a major opportunity for e-commerce companies in Europe, as they seek out to carve more retail market share. (RetailMeNot)

WELCOME TO E-COMMERCE INSIDER: This is the first edition of our newsletter covering all things e-commerce. Don't forget to sign-up and get it every morning in your inbox. Please email csmith@businessinsider.com with news and tips.

AMAZON'S STREAMING DEVICE: The Wall Street Journal is reporting that Amazon's long-awaited video streaming device will hit stores like Best Buy and Amazon's own website in early April. Amazon's streaming gadget will carry some of the same apps already found on Apple TV and Roku, the paper reports. The device will likely come bundled in some form with Amazon Prime, the company's loyalty, streaming video, and free shipping service. Prime recently had its price hiked from $79 to $99 annually. Here's our take: if the streaming device does boost the popularity of Amazon Prime, it may lead to major sales and revenue gains for Amazon, since Prime customers are known to order more from Amazon. The Kindle, Amazon's other hardware line, is one of Amazon's bestselling items. (The Wall Street Journal)

Meanwhile, TechCrunch is reporting that the device will look like Google's Chromecast, meaning it will be a small, dongle-type device that plugs into the back of TV sets.

PAID ONLINE ADS FOR E-COMMERCE CONVERSIONS: Many online sellers see positive return with paid ads. The founder of one e-commerce site for children's formal wear tells E-commerce Bytes: "Our Google AdWords campaigns now bring in 50 percent of our gross sales on our ecommerce site. With a very nice conversion rate of 10 percent with each conversion costing us around $5, which is cheaper than paying the Amazon or eBay fees." (E-commerce Bytes)

Advertisement

SHOULD GOOGLE ACQUIRE EBAY?: While eBay investors debate whether PayPal should be spun off into a separate company, analysts are now suggesting a merger or acquisition could be on the table. Google is the most likely suitor in this hypothetical deal. Google has already made significant investments in e-commerce and online payments, but Amazon and Apple have been able to keep the Internet giant at bay. Google could tap its $57.5 billion in cash reserves to make a play for eBay/PayPal. "[Larry Page] has shown that he is open to large deals, and both companies would likely be stronger together in the significant technology and user arms race unfolding with Amazon, Apple and Facebook," said Baird analyst Colin Sebastian. (MarketWatch)

BIG DATA AND RETAIL: The 2014 Big Data In Retail Study listed the areas where surveyed retail executives found big data to be the most beneficial: "The areas are merchandising (53 percent) and marketing (48 percent), followed by store operations (42 percent), e-commerce (42 percent), supply chain (27 percent), finance (23 percent) and loss prevention (21 percent)." (Fierce Big Data)

ALIPAY FRAUD RISK: The Chinese government warned consumers of a loophole in Alipay's password protection system that exposes a user's account information. Alipay, which is owned by e-commerce giant Alibaba, is the one of the largest third-party payments providers in the world with 300 million users. The company issued a response saying that it prides itself on "robust security and risk management." (Wall Street Journal)

CHINA MAY FURTHER LIMIT ONLINE GIANTS' MOVE INTO PAYMENTS. Last week the People's Bank of China (PBOC) released a set of rules for consultation that would effectively ban companies like like Tencent and Alibaba, which provide third-party payment platforms, from processing offline transactions. The rules would limit the amount of money that third-party payment platform users could spend and transfer as well. The news comes on heels of the PBOC's decision to halt mobile payments that are transacted via QR code highlighting a continuing clash between China's e-commerce giants and the country's financial institutions. (Reuters)

ALIBABA'S U.S. IPO: China's e-commerce giant, which also operates the very popular Alipay payments platform, announced it will pursue a U.S. initial public offering, and analysts believe the firm could raise up to $15 billion in a stock offering. Yahoo, the U.S.-based consumer Internet giant, owns a significant stake in Alibaba, so could see its own market capitalization buoyed as a result, if the market warms to Alibaba stock. A statement from Alibaba did not mention the exchange on which the IPO would take place, or when. China's Twitter-like social network, Sina Weibo, has also announced plans for a U.S. IPO. (BBC, Alizila)

Advertisement

Here's what else BI Intelligence subscribers are reading …

The Web Will Influence More Than Half Of All US Retail Sales This Year

Less Than One-Third Of Marketers Use Paid Social Analytics Tools

The New Gatekeepers: The Chinese And Indian Manufacturers That Hold The Keys To Mobile's Next Growth Opportunities

Mobile Card Readers Are Catching On Fast Among Small- and Medium-Sized Businesses

Advertisement

Target's Flaw - Smart Watch Payments - Google Wallet's New Feature

Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.