Understanding Mobile Commerce Revenues: Points and Assists

With the success of new mobile websites, the facts around how a mobile
website increases your mobile commerce conversion rate, average order
size and e-commerce revenues have become well established.  Mobile
optimized websites work.

More recently, we’ve been digging deeper into how mobile websites
contribute more than what’s immediately obvious.

The most obvious benefit of a mobile website is that it improves the
user experience for customers – Google has some in-depth data on how a
good mobile experience boosts user experience.

An improved user experience applies not only to customers in
the purchasing process, but also to seeking information.  For instance,
many customers will search for store locations on their mobile device
and research or price a product while in store.

The mobile device is bridging the digital and physical world.

For both multi-channel and e-commerce retailers, mobile contributes to
your bottom line – even if the resulting revenues aren’t necessarily
attributed directly to mobile site revenue.

Points and Assists

To explain how a mobile website contributes beyond just direct mobile
commerce revenues, let’s use a sports metaphor of a basketball team. The
team has many players who fit together with the goal of maximizing the
number of points it scores.

Only one player can score every point (or 2 or 3 pointer) but behind
each point scored is a number of passes and assists. To see the full
picture of mobile commerce we need to look at the team, how it works
together and both the scorers of the points and the teammates who
provide the assists.

Your mobile website scores when a customer buys directly on their mobile
device. Your mobile website also provides assists to its teammates when
someone uses your store locator to find the nearest outlet, emails a
gift idea to a friend and shares their latest purchase or object of
desire on social media.

A good mobile site scores points and contributes valuable assists.  So,
think of your mobile website as the Steve Nash of your e-commerce
strategy: a valuable scorer that’s also great at setting up plays and
assisting the team.

So, how much money is mobile making for me?

This question consistently arises as one of the top questions we hear at
conferences, in phone calls and at in-person meetings with customers.

To answer properly, we need to break it down into two smaller questions:

  1. What is my direct e-commerce revenue on mobile devices?
  2. What is my indirect e-commerce revenue assisted by mobile devices?

1. Direct revenue on mobile devices

The first question is easy to answer with your analytics.  Dive into
Google Analytics, Omniture, or your analytics package of choice and
segment out mobile devices and you have your answer.

This is were your mobile points are scored.

2. Indirect revenue assisted by mobile devices

Here’s where things get interesting — where mobile-influenced revenue
starts to show up in desktop e-commerce revenues. To return to our
basketball metaphor, how many assists does mobile provide?

Short of interviewing your customers, it’s incredibly hard to establish
a causal link between a mobile site and mobile-influenced revenues. 
However, some retailers have gone ahead and done this and we can look to
their examples for guidance.

  • The first source is BestBuy: “The multichannel Best Buy consumer
    who uses a mobile device makes 15% more e-commerce purchases than
    the non-mobile consumer, said Chris Moroz, Best Buy associate
    manager for digital analytics. And, for in-store purchases, the
    mobile Best Buy consumer is 25% more valuable.”
  • Next up, data from Neilsen that says people responding to mobile
    ads are 4 times as likely to buy on their PC than on their mobile
  • And lastly, eBay’s second quarter earnings for 2012 provided
    some good insights such as, ‘”Mobile is impacting a significant
    portion of eBay’s business,” said Donahoe. “Mobile shoppers and
    mobile payers are three to four times more valuable than Web only.”‘

One of Mobify’s customers has done experiments to track their users’
activity across mobile and desktop transactions. From those experiments,
they report that for every $1 the customer spends on mobile, they spend
$6 on desktop e-commerce.

Avinash Kaushik has a great, long, in-depth post on how to build your
own system to count points scored and assists contributed
called Multi-Channel Attribution: Definitions, Models and a Reality
 that also tries to incorporate in-store purchases.

So what’s the answer for your business?

Talk to us and find out.  We’re glad to help you understand the
opportunity for you to score points and assists on mobile.

The Mobify platform powers over $100-million in mobile commerce
revenues for leaders like Starbucks, ideeli, Beyond the Rack, Threadless
and and more.

Talk to a Mobify mobile expert.