Hey cool, I just found some awesome Festivus-themed socks. I’m going to buy them right now!
All I have to do is use my smartphone’s tiny keyboard to oh-so-carefully tap in my name, email, password…then my address…then my credit card number…then…sheesh, forget it. I’ll just play Candy Crush.
A scene like that may seem meaningless — hardly anyone cares I didn’t get those socks — but such aborted purchases point to a big problem in US smartphone shopping that’s frustrating customers and retailers alike.
The process of buying physical goods on your phone stinks. Consumers complain that product images are too small and that entering payment information is aggravating and stressful. So while we all use our smartphones more and more to compare prices and research products, we don’t tend to make purchases on the devices, according to data from several retail researchers. Most people use desktops instead, where a larger screen and physical keyboard make buying a breeze.
“The reality is,” Anuj Nayar, PayPal’s senior director of global initiatives, told me while holding up his iPhone, “it’s very, very difficult to pay with one of these.”
The results of this situation are crummy for those on both sides of the transaction. US retailers are seeing a big increase in their online traffic coming from smartphones, but they aren’t able to turn those visitors into buyers — and they’re likely annoying potential customers along the way. That’s a huge missed sales opportunity, industry experts say. The situation is unproductive for consumers, too, sincethey spend three hours every day on mobile devices for activities not involving phone calls.
“My little iPhone 5 just is not conducive to shopping,” Marisa Falcon, a 30-year-old Brooklyn resident, said while checking her phone on the street in Manhattan. “Entering your credit card on that touchscreen is a total drag.”
Data from the busy holiday-shopping season is a drag, too. From Black Friday to Cyber Monday this year, nearly half of online retail traffic came from smartphones, about double from the year before, reports market researcher ChannelAdvisor. But smartphones accounted for just a quarter of purchases. Desktops brought in 60 percent of sales while accounting for less traffic than phones.
Just 20 percent of US shoppers using smartphones tend to complete a purchase after placing an item in their virtual shopping cart, according to Visa. That figure is about 60 percent on desktops and 40 percent on tablets. Just how bad is that? If those people were in-store customers waiting at the checkout line, four out of five would be ditch their carts and walk out of the store before making their purchase.
Toys “R” Us is working to change that by simplifying its site on smartphones and making mobile checkouts easier, said Richard Barry, the company’s chief merchandising officer. Those efforts have started convincing more shoppers to follow through with their purchases, he said. But there’s still a long way to go.
It’s difficult and expensive for traditional retailers to make these changes. Most don’t have widely used mobile apps and employ just a handful of mobile developers, so change comes slowly. For now, Amazon and eBay seem to be benefiting from other retailers’ lousy mobile sites, said Scot Wingo, ChannelAdvisor’s executive chairman. Both online sellers have popular apps that store customer information, making shopping much easier.
It doesn’t have to be this way. In China, mobile shopping is much simpler for customers, thanks to better integration of payment information on phones and more-developed mobile shopping websites, Wingo said. That lets retailers including JD.com and Alibaba make large chunks of their sales on the same devices customers now use the most. Alibaba reported that, as of September, 47 percent of its sales came from mobile, a figure most US retailers would envy.
There are several efforts afoot to make smartphone shopping in the US less miserable, but they’re still young.
PayPal last year launched One Touch, which lets people buy items on retail sites without having to constantly re-enter their information. However, the service has attracted only a sliver of PayPal’s 173 million active accounts.
Visa is working on a similar concept, called Visa Checkout. Yet the number of users amounts to a rounding error relative to its 2.1 billion accounts.
Facebook, Twitter and Pinterest also are starting to offer “buy now” buttonson their sites to make buying easier.
Apple’s Apple Pay and Google’s Android Pay might also jump into the mix as they evolve and gain adoption as places for consumers to store their payment information, Wingo said. Both services today focus on in-store purchases, not online shopping.
As those efforts ramp up, next year could be a critical one in helping make the smartphone more than just a place where people go window-shopping.
“We’re still in the early days of enabling the smartphone as a great commerce vehicle,” said Sam Shrauger, senior vice president of Visa’s digital solutions.
Maybe it won’t be too much longer before I actually want to use my phone to nab those Festivus socks.