Proliferation of Mobile Phone in E-Commerce

Running head: PROLIFERATION OF MOBILE PHONE IN E-COMMERCE

Proliferation of Mobile Phone in E-Commerce
Gertrude Nyandat
Grantham University

Abstract

This Paper explores five published articles that reiterate the proliferation of mobile phone in E-Commerce and how mobile phone has penetrated in the day to day commerce industry. These articles agree that mobile phone usage is growing at a faster rate its future in E-Commerce is very bright. Zorrille Ltd (Ecommerce article) explained how the field of wireless technology is tremendously increasing. Ferner (2011) gave us 21 ecommerce applications for mobile phone that are being used to facilitate ecommerce, and how businesses are coming up with applications after another to make it easier for them to conduct business. Consumers and businesses are conducting their business on a mobile device through an application (commonly known as apps) that can be downloaded on the mobile device. Once the app is downloaded, users have the power to use the mobile device to make purchases from virtually anywhere. Lui (2011) wrote on the usage of mobile phone and how it is reshaping the E-Commerce virtually anywhere. He explained how living in a constantly connected world makes mobile phone a preferred mode of business. Akei &Mbiti (2010) and Ochieng(n.d) analyzed the impact of mobile phone in our financial transaction and touched on how the African continent has benefited in mobile financial transactions by using M-PESA (“M” stands for mobile; “PESA” stands for money in Swahili).

Keywords: mobile phone, ecommerce

Electronic commerce is the electronic exchange, delivery or transaction of information, goods, services, and payments over telecommunications networks. As e-commerce technologies advance into the 21st century there is no doubt that the popularity of mobile e-commerce is increasing. Mobile phone has become so popular that many businesses are beginning to use mobile commerce as a more efficient way to communicate with their customers. The Mobile phone has become an unlimited space for the growth of any ecommerce industry and many possibilities and opportunities are constantly becoming available for businesses. Mobile phone is growing faster than predicted. It is just a matter of time when the future of a retail business may depend on how and when they capitalize on mobile phone. Zorille Ltd writes:

“Cellular phones and PDA 's are being used by many businesses as they consider it the most effective method of communicating with their customers. Leading cellphone manufacturers are working alongside cellphone service providers to develop WAP enabled smart phones to cater to the demands of the ever growing m- commerce industry and to exploit the m-commerce market potential.”(Zorille Ltd, n.d) The demand of iPhone and other smart phones as they are known has meant that more people are using internet on their phones to do transaction than ever before. Companies are creating more mobile optimized websites some of which now allow people to complete ecommerce transactions on the mobile. Just a few years back, if you needed to transfer money from checking to a savings account and vice verse, you would need to locate a desk top computer with internet access, ATM machine or bank branch to do the transaction. Most banks have a mobile application that allows their customers to do the transaction right on the palm of their hands using their mobile phones. The Financial sector is not the only sector that has capitalized on this. Sears introduced their mobile App Sears2Go, Gucci come up with Gucci Mobile App. Priceline created a mobile Application that many customers use to make hotel and flight reservations literally at the very last minute. The trading sector hasn’t been left behind either, Scot trade launched an advanced mobile trading site that has the ability to manage accounts and trade online from any internet enabled phone. Thanks to mobile phones, there is mobile ticketing where you can purchase a football, basketball, concert or any other show ticket and have the tickets sent to your mobile phone. You then present the phone at the venue no more printing. To Emphasize the point that mobile phone usage is more widespread and business are coming up with new ideas to capitalize on this, Ferner in his article , 21 Ecommerce Apps for iPhone, Android and Blackberry. Stated that: “Ecommerce business owners can use mobile apps to help run a website. Whether you are interested in blogging, social networking, customer support, there is a mobile app tool for just about anything an ecommerce website may need.” (Ferner, 2011)

Businesses are trying to catch up with the mobile uproar on ecommerce. They know that with the mobile applications, it is so easy for customers to access the common benefits of shopping online such as product reviews, information, compare prices with other retailers and retrieve coupons while still shopping in the physical store. Businesses are forced to do away with the overnight update hence they loss customers. Just the other day I was shopping for a particular pair of snow boots. I walked into the Macys store and surely the boots were their but at a price that was above my budget. I took out my mobile phone loaded with a barcode application. Take a snap shot of the barcode on the boots that I wanted and just a few seconds later I had the boots review, locations where available and prices at each location. I ended up buying the exact pair of boots at Journey’s at a much lower price. Lui in his article The Mobile Future hit the nail right on the head when he wrote:

“We are living in a constantly connected world by the end of the year; a majority of the U.S cell phone Population will have a smart phone. This penetration will be even higher amongst the most attractive advertising demographic, 18-34 year olds. This means that consumers can access your website, and your competitor’s website, anywhere and at any time of day. -------Getting the news out just a little bit slower than your competitor means you might as well not bother.”(Lui 2011)

Developing Countries are catching up with the use of mobile in commerce. Just recently World Wide Web was a foreign thing to many people in developing country. A good example is my native country Kenya. Finding a household with desktop or laptop computer was and is still as rare as a hen’s teeth. Then came mobile phone. The vast adult population in Kenya owns a cell phone. With the burst of cell phone usage, Safaricom and Commercial bank of Africa come up with a micro-payment platform called M-PESA which allows customers to use their phone like a bank account and debit card. The customer credits their account at their local air-time dealer and can then transfer the value to another person’s phone or use it to make a loan repayment or redeem it as cash. Ochieng wasn’t wrong when he said that MPESA has revolutionized money transfer services in Kenya. “Banking in Kenya is fast moving away from brick and mortar as more customers embrace m-money services. Notably, M-Pesa, Kenya’s pioneer mobile money transfer service operated by listed mobile operator Safaricom, has so far registered 9 million customers. The service—launched in March 2007—has revolutionized money transfer services in the country by providing Safaricom subscribers with a fast, safe and affordable way to transfer money by phone.”(Ochieng, n.d)
Akei &Mbiti also echoed the same sentiments Ochieng had on MPesa in there Africa Calling; can mobile phones make a miracle? article. They stated: “Of all the mobile services and products, financial applications (“m-money”) have received the most attention, and M-PESA, Kenya’s mobile money-transfer program, has been at the center of it. ---- M-PESA has effectively displaced other options.” (Akei &Mbiti 2010)

Mobile Phone is indeed reshaping the world of ecommerce. The question that I keep asking myself is what has given rise to this trend? What is making the use of mobile phone in ecommerce such a popular web activity? Is it the proliferation of mobile phones or more affordable data plans or the fact that more mobiles are having a built in web browser with mobile ready websites, flexibility or personal touch? I believe that these are important factors that have played a role in increase usage of mobile phone in ecommerce. Zorille ltd summarized it well when they stated that:

“Mobile commerce characterizes features like omnipresence, flexibility, personalization, dissemination and therefore it promises unprecedented market potential, great productivity and high profitability.’(Zorille Ltd n.d)

Mobile phone has a lot of benefits when used to conduct ecommerce such as; it provides a wider reach for businesses to consumers, reduces transaction cost, streamline business process, and provides competitive pricing and last but not least reducing time to order. Mobile phone has its disadvantages such as technology constraints of mobile devices such as memory, processing power, display capabilities, input methods. Another disadvantage is limited roll out of higher bandwidth mobile networks and devices to name but a few. Mobile phone technology is changing and improving as fast as lighting. In a few years this disadvantages will be ironed out. Mobile will be a big Part of the Future of E-Commerce as E-Commerce development is now shifting from wired computers to wireless mobile devices at a very fast rate.

References

Aker .J.C & Mbiti.I.M (March/April, 2010). Africa Calling, Can mobile phones make a miracle? Retrieved from http://bostonreview.net/BR35.2/aker_mbiti.php
Ferner.Matt. (February 01, 2011). 21 Ecommerce Apps for iPhone, Android and Blackberry.

Retrieved from http://www. Practicalecommerce.com/articles/2554-21-Ecommerce-App...

Lui. Terrence. (January 28, 2011). The Mobile Future. Retrieved from

http://reqularlyexpressed.com/the-mobile-future/

Ochieng. Zachary. (n.d). Kenya’s M-Pesa Now has 9 Million Customers. Retrieved from

http://www.uneca.org/AU2010/docs/M-Pesa.pdf

Zorille Ltd, ecommerce Articles. n.d. Mobile Commerce. Retrieved from

http://ecommercearticles.co.uk/MobileCommerce.aspx

References: Aker .J.C & Mbiti.I.M (March/April, 2010). Africa Calling, Can mobile phones make a miracle? Retrieved from http://bostonreview.net/BR35.2/aker_mbiti.php Ferner.Matt. (February 01, 2011). 21 Ecommerce Apps for iPhone, Android and Blackberry. Retrieved from http://www. Practicalecommerce.com/articles/2554-21-Ecommerce-App... Lui. Terrence. (January 28, 2011). The Mobile Future. Retrieved from http://reqularlyexpressed.com/the-mobile-future/ Ochieng. Zachary. (n.d). Kenya’s M-Pesa Now has 9 Million Customers. Retrieved from http://www.uneca.org/AU2010/docs/M-Pesa.pdf Zorille Ltd, ecommerce Articles. n.d. Mobile Commerce. Retrieved from http://ecommercearticles.co.uk/MobileCommerce.aspx