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Mobile Commerce Moves Up To Marketing Mega-Trend

Topic: Mobile Marketing, Research, Social Media | Author: Jeff Hasen | Date: December 2, 2011

mobile commerce holiday shoppingIt was the brands that told us with their increased marketing spends that 2010 was The Year of Mobile. Now consumers are the ones showing us through their actions — reaching for their mobile phones at every step of the consumer journey, from researching products to making purchases — that this is the Year of Mobile Commerce.

IBM’s Smarter Commerce initiative has produced a new online retail benchmark study, research that compares Cyber Monday 2011 versus Cyber Monday 2010 and reveals some surprising trends. By way of background, these early holiday season findings are based on data from IBM Coremetrics Benchmark, an analytics-based, peer-level benchmarking solution that measures online marketing results, including real-time sales data from the web sites of more than 500 leading U.S. retailers. All of the data is aggregated and anonymous.

Predictably, we are willing to spend more when shopping on the Internet. Online sales in the U.S were up 33.0 percent over 2010, with consumers pushing the average order value up from $193.24 to $198.26 (or an increase of 2.6 percent). The real news is our increasing reliance on mobile. Specifically, 10.8 percent of people used a mobile device to visit a retailer’s site, up from 3.9 percent in 2010. Additionally, mobile sales grew dramatically, reaching 6.6 percent on Cyber Monday versus 2.3 percent in 2010.

How did Cyber Monday 2011 compare to Black Friday 2011?

  • Online sales were up 29.3 percent over Black Friday
  • On Cyber Monday mobile traffic averaged 10.8 percent compared to 14.3 percent on Black Friday
  • Consumer sales on mobile devices reached 6.6 percent versus 9.8 percent on Black Friday
  • Apple’s iPhone and iPad continued to rank one and two for mobile device retail traffic (4.1 percent and 3.3 percent respectively). Android maintained its position in third at 3.2 percent. Collectively iPhone and iPad accounted for 7.4 percent of all online retail traffic versus 10.2 percent on Black Friday
  • Shoppers using the iPad also continued to drive more retail purchases than any other device with conversion rates reaching 5.2 percent compared to 4.6 percent

How I See It: Mobile has become as much a part of the holidays as snowflakes and candy canes. Several surveys, including one from Hipcricket, show that consumers would use their devices in-store to compare, shop, read product reviews and more. But it’s not just a shift in attitudes that we see. A near tripling of mobile web site visits and sales from mobile are clear indications that people are engaging in mobile retail. Indeed, mobile shopping is fast becoming a mainstream activity and the market has moved past the early-adopter stage. To the brand marketers who have yet to get on board, I offer two thoughts. One: you have some serious catching up to do. And it’s not like we kept you in the dark about the tremendous mobile opportunity or you weren’t given enough information to act. Two: there is still time for you to create a mobile advertising campaign for this holiday shopping season. But planning broadly for next year should start before Santa parks the sleds and calls it another season.

Facebook’s big mistakes

The social networking service Facebook agreed to settle Federal Trade Commission (FTC) charges that it deceived consumers by telling them they could keep their information on Facebook private, and then repeatedly allowing the personal data to be shared and made public. The proposed settlement requires Facebook to take several steps to make sure it lives up to its promises in the future. Top of the list: Facebook will have to obtain people’s express consent before their information is shared beyond the privacy settings they have established (and agreed to) on their Facebook page.

The FTC charged that the claims Facebook made were unfair and deceptive, and violated federal law. As Jon Leibowitz, FTC Chairman, put it: “Facebook is obligated to keep the promises about privacy that it makes to its hundreds of millions of users.” Facebook’s innovation “does not have to come at the expense of consumer privacy.” The FTC action is aimed to make sure it doesn’t.

Interestingly, the FTC complaint also lists a number of concrete instances in which Facebook allegedly made promises that it did not keep:

  • In December 2009, Facebook changed its website so that certain information users may have designated as private – such as their Friends List – was made public. Facebook didn’t warn users that this change was coming, or get their approval in advance.
  • Facebook stated that third-party apps that users installed would have access only to user information that the apps needed to operate. In fact, the apps could access nearly all of users’ personal data – data the apps clearly didn’t need.
  • Facebook told users they could restrict sharing of data to limited audiences – for example with “Friends Only.” In fact, selecting “Friends Only” did not prevent their information from being shared with third-party applications their friends used.
  • Facebook had a “Verified Apps” program and claimed it certified the security of participating apps. It didn’t.
  • Facebook promised users that it would not share their personal information with advertisers. It did.
  • Facebook claimed that when users deactivated or deleted their accounts, their photos and videos would be inaccessible. But Facebook allowed access to the content, even after users had deactivated or deleted their accounts.
  • Facebook claimed that it complied with the U.S.- EU Safe Harbor Framework that governs data transfer between the U.S. and the European Union. It didn’t.

In this blog post Facebook founder Mark Zuckerberg apologized and pledged to do better.

His response to the strong allegations: “Overall, I think we have a good history of providing transparency and control over who can see your information.”

But he did admit to making some mistakes along the way. “In particular, I think that a small number of high profile mistakes, like Beacon four years ago and poor execution as we transitioned our privacy model two years ago, have often overshadowed much of the good work we’ve done.”

Zuckerberg also showed some understanding for the hundreds of millions of members who feel their personal information —and trust— was compromised. “Even if our record on privacy were perfect, I think many people would still rightfully question how their information was protected. It’s important for people to think about this, and not one day goes by when I don’t think about what it means for us to be the stewards of this community and their trust.”

He closed his post reminding us that Facebook has always been committed to being transparent, and promised to do better in the future. “I’m committed to making Facebook the leader in transparency and control around privacy,” he stressed.

How I See It: This is cause for public outrage, but I’m not seeing it. Consumers have not punished Facebook for its deception despite repeated reports of infractions. That’s either because they haven’t noticed that Facebook has breached their trust, or they simply don’t care. I believe it’s mostly the latter. Zuckerberg said all the right things in his blog and public apologies. But the company’s actions are really all that matter. If Facebook members won’t do anything about Facebook’s privacy breach, then the FTC has shown that it will.

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