2016 has been an amazing year for mobile commerce, and 2017 promises to be even more exciting. Here are my five top predictions for the coming year.
1. Shopping via apps will rise and rise
This is an easy one. It’s a no-brainer that online sales will continue to grow. And mobile’s share of that will continue to rise, as more and more customers adopt a mobile-first strategy. Predictions of the actual magnitude of this growth vary wildly, with some experts expecting m-commerce to grow by over 200%.
Even many of the more conservative estimates exceed 100%. Whatever happens, it’ll be huge. And mobile apps will deliver a growing percentage of that. While Web will continue to be the primary platform for discovery, apps will be the platform of choice for loyal, repeat customers. They offer better communication, better UX, and a much slicker shopping experience, which in turn results in better conversion rates, more customer engagement, and higher sales compared to mobile Web.
Admittedly, apps probably won’t surpass mobile Web in 2017, but it’ll definitely get closer, perhaps hitting as much as 40% of m-commerce. Retailers who aren’t offering mobile sales in 2017 are really going to lose out, and retailers without apps will be missing out on the biggest growth area of all.
2. Delivery will be a primary deciding factor
Customers aren’t just interested in whether they can find what they want at the price they want. They want more options and better choices on how to actually get their stuff.
Over 80% of customers expect a same-day shipping option, and 65% expect their goods to be packed and shipped within three hours of them placing an order, even in the middle of the night. Importantly, they don’t expect that service to cost extra. Over 60% now want a same-day delivery option, while 82% want to be able to buy online and pick up in-store. 45% of customers want to buy in-store and have goods delivered to their home or office. Currently, less than half of US or European retailers offer any of those options.
Meanwhile, Amazon have just announced their first successful drone delivery, with just 13 minutes from order to arrival. That’s raising the bar for everyone. Retailers who can offer fast shipping with multiple delivery options, preferably free, will enjoy a huge competitive advantage over those who don’t. In 2017 this will become the norm.
3. Mobile fraud will become more common
The USA has finally begun to adopt secure Chip and PIN technology, which will massively reduce fraud in stores. This is obviously great news for consumers and retailers, but there’s a hidden downside. Fraudsters will turn their attention towards sales that don’t involve a physical card reader. Online sales of all sorts will be affected: already there’s been a 26% increase in online fraud in just six months, and mobile fraud will doubtless follow suit.
Currently, only 29% of US stores accept chip cards, which suggests that what we’re seeing is only the beginning. As old-style swipe cards get phased out over the course of the year, online and mobile fraud will keep rising. As Forrester points out, “Mobile offers fraudsters more options than any other channel.” 2017 will be the year that retailers start to take mobile fraud prevention as seriously as other forms of online security - if they don't, it could become a huge problem.
4. Alternative payment systems will become standard
On a related note, customers are becoming wary of making card payments via mobile. It’s often cumbersome and error-prone, and there are serious security concerns. Instead, they’ll turn in increasing numbers to other forms of payment, especially outside the US and Europe. WorldPay believes that payment systems such as PayPal, Apple Pay, Google Wallet, AliPay, MoPay, Square, direct app payments or pre-paid accounts will account for a massive 59% of m-commerce transactions in 2017. PayPal and AliPay alone will account for almost 40% of worldwide mobile sales.
Mobile abandonment rates exceed 80% when customers are asked to input their credit card details. If you’re still forcing your mobile customers to use their credit cards in 2017, you should not be surprised to see them drift away to competitors who offer a safer, easier alternative.
5. AI-backed systems will start to dominate
AI is no longer science fiction. It’s happening now. Consumers expect shopping sites to be much more than just categorised or a searchable list of products. They expect sites to know what they want, to make recommendations, to highlight the products they’re looking for, and to interact with them proactively.
They won’t accept mass email promotions blasted out to everyone: they expect personalised, targeted notifications telling them about the products and offers *they* want to see. And when they have questions, they want answers right away. Email is no longer fast enough or personal enough. As a result, more and more retailers are turning to smart chatbots for front-line customer support.
They’re not perfect yet, but chatbots can typically handle 80% of all inquiries, which cuts operating costs while allowing your human staff to focus on more complex customer service issues. In 2017, as more artificial intelligence is deployed worldwide they will get smarter, more human-like, and better at delivering increased sales and happier customers.
A modified version of this article was originally published by Information Age.
Andreas is Founder and CEO of Ombori. He is a serial entrepreneur who has founded several companies, starting in his teens. He has a background in cybersecurity, and has worked for companies such as H&M and Nordnet Bank. Andreas is a passionate believer in digital transformation, and is constantly seeking ways in which technology can change the way we work, shop, and live our lives.