M-Commerce Experiments, Both Good And Bad
By Mike Masnick, Mon May 23 23:30:00 GMT 2005

Hype about mobile commerce comes and goes, even as customer adoption has been mostly slow. In judging what types of m-commerce offerings are likely to be successful, it pays to bet on those that improve the experience for the consumer, not just the retailer.

For years, companies have been searching for the mobile commerce holy grail -- but so far, most attempts haven't gone very far, either due to lack of customer understanding about an offering or simply lack of customer demand. It quickly becomes clear that any offering that's going to be successful in the mobile commerce space needs to put the customer first. That is, it needs to be solving a real problem shoppers face. So far, very few mobile commerce solutions do that.

Take, for example, a new shopping mall called "the future of retailing" that tries to meld the best of online and offline shopping -- but seems to get the worst of both. The concept is straightforward. When you enter the mall, you register your address and credit card number, and are handed a small device (the "buypod") which has that info stored on it. As you wander around the mall, you can scan various items for more information and click to order them. A few items can be taken home from the store, but most orders are beamed to a warehouse, where the products are then shipped to your home, as if you had ordered them online.

In other words, as a shopper, you lose the immediacy and instant gratification of offline shopping. You also lose the comparison shopping, additional reviews and lack of crowds that online shopping provides. About the only real "benefit" compared to online shopping is that you get to see and touch the actual object -- but you could already do that with traditional offline shopping. In other words, the only real benefit is to the store owners, who have lower inventory costs. This might allow them to lower prices slightly, but not as much as a truly online retailer.

The problem here, is that the benefit accrues almost entirely to the retailer, and most of the negatives are still handled by the consumer. That doesn't sound very appealing. Compare this to an operation like ScanBuy, which takes a very different approach. The company, who has been around for a while, but is getting more attention these days, lets users take their cameraphones, snap photos of product bar codes, and receive product info and comparison shopping data in return. Others, like Amazon in Japan, have been testing out similar offerings. Beyond letting you use the devices you already have, they all put the benefits squarely in the hands of the users -- allowing them to effectively blur the lines between the tangible and digital worlds, by giving them the means to pull up useful data about any real world product, on the go. Retailers may not like it, but it seems unlikely that they'll be able to stop it.

The clear lesson, however, is that mobile commerce solutions need to be focused on the consumer end -- helping them to do something that couldn't have been done before. Solutions that create mobile commerce "just because" or that don't actually benefit the consumer are going to have a hard time getting any real acceptance.