Smartphone sales seen reaching $689bn
Beirut, August 6, 2012
Smartphones will represent 19 per cent of annual retail store sales by 2016, amounting to $689 billion from the current 5.1 per cent translating into $159 billion in forecasted sales for 2012, a report said.
By comparison, direct mobile commerce sales will pass the $30 billion mark by that time, said the in-depth study measuring the “mobile influence factor,” or impact of smartphones on in-stores sales by Deloitte, a leading professional services firm.
“Mobile devices’ influence on retail store sales has passed the rate at which consumers purchase through their devices today,” said Santino Saguto, partner in charge for the Telecommunications, Media and Technology (TMT) industry, Deloitte Middle East.
“Consumers' store-related mobile activities are contributing to – not taking away from – in-store sales, and Deloitte research indicates that smartphone shoppers are 14 per cent more likely to convert and make a purchase in the store than non-smartphone users.
"This means that mobile is an important tool for retailers to incrementally drive traditional in-store sales, strengthening the relationship between retailer and consumer to increase engagement and loyalty.”
In the Middle East, while e-commerce adoption remains low, online sales have increased rapidly in the past two years and are expected to continue to grow fast due to the region’s demographics.
According to the fourth Arab Media Outlook Report (AMO), issued by Deloitte and the Dubai Press Club, in most Arab markets in the region, except the UAE, ecommerce adoption remains below 5 per cent of the population with transactions mostly focused on ticketing (flights, concerts etc.).
However the digital platform has a strong potential for growth given the favorable demographics of the Middle East region (i.e. more than 50 per cent of the population is below the age of 25). In addition, due to the strong regional uptake of smartphones and mobile broadband an increased activity in m-commerce and mobile social networking is forecasted.
With close to half of the population using smartphones in countries such as the UAE, there is a strong propensity to download and use mobile apps. According to the AMO report, on average, smartphone users in the region have up to 32 apps on their phone and over 50 per cent of the smartphone users regularly download applications on their phones.
“We are finding many payment solution providers, marketplaces, local recommendation sites and commerce platforms sprouting up across the MENA region, to develop a suitable ecosystem around e-commerce and m-commerce,” said Emmanuel Durou, Telecommunications, Media and Technology (TMT) director at Deloitte in the Middle East.
“Jointly with smartphone adoption these changes are expected to boost the impact of mobile on the retail sector and improve the in-store shopping experience,” he added.
To better understand the growing impact of mobile devices on the retail sector, Deloitte’s retail & distribution practice and Deloitte Digital conducted an in-depth survey of US consumers about how they use their smartphones to shop today and their likelihood of using them in future buying decisions.
Nearly half (48 per cent) of US smartphone owners surveyed say their phones have influenced their decision to purchase an item in a store, and the study shows that consumers’ smartphone use tends to be highest at or near the point of purchase.
Based on Deloitte’s survey, more than 6 out of 10 (61 per cent) of smartphone owners who use their devices to shop have done so while shopping at the store, and more than half (52 per cent) reach for their phones on the way to the store.
Smartphone-toting consumers appear more likely to make a purchase than those who do not own one or do not use it to assist in-store shopping. When asked about their most recent shopping trip, nearly three quarters (72 per cent) of smartphone owners surveyed indicated they made a purchase on that day, compared with 63 per cent of respondents who did not use a phone.
Smartphone users were also more likely to eventually make a purchase: among those who did not buy anything on their last trip, 59 per cent of those who used a smartphone eventually made a purchase, compared to only 22 per cent of those who did not use one. – TradeArabia News Service