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Number 5: M Commerce and The Rise of the Machines

The explosion in online shopping — especially mobile commerce, from smartphone to tablet — has rabidly revolutionized the way we shop.

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Android

The prototype of a Android mobile phone.

Photo By Bloomberg/Getty Images

Appeared In
Special Issue
WWD Year In Fashion issue 12/12/2011

In the home, out of the home, at school or work, at a restaurant or on a bus — consumers are shopping on the go more than ever before.


In a report released by comScore on Dec. 5, 38 percent of smartphone owners have used a mobile device to make a purchase at least once. For the month of September specifically, clothing and accessories were the second-most popular category for smartphone device transactions (behind digital goods), with 37 percent of mobile users purchasing these items directly from retailers.


“Mobile is transforming how people shop and how they expect to shop. It’s changing the game in how they think of physically shopping — whether it’s a companion to brick-and-mortar or avoiding the store altogether. Your physical location doesn’t matter,” said eBay’s vice president of mobile, Steve Yankovich.


And interestingly, comScore’s mobile shopping report found that more than one in three purchases occurred while the shopper was in-store, illustrating how mobile is becoming increasingly important as a counterpart to the brick-and-mortar retail experience.


On eBay’s mobile app — eBay Mobile — clothing, shoes and accessories is the most popular category shopped, said Yankovich. The app, which has been downloaded over 58 million times since its launch about three years ago, can get up to 1 million new downloads a week and sees $180 in purchases a second. If you do the math, this translates to $648,000 an hour or $15.5 million each day — and 24 percent of all mobile activity is derived from apparel and accessories. So that’s about $3.7 million daily from the category.


At flash site Rue La La, m-commerce has grown to become an average of 18 percent of business during the week and 30 percent on weekends, according to the site’s president, Steve Davis. Mobile sales for the site have grown more than 250 percent compared to last year, and projections for this year in mobile sales are expected to reach $50 million.


This comes as no surprise, as Scott Galloway, New York University marketing professor and co-founder of NYU think tank Luxury Lab, contends that the most dramatic changes this year in the digital realm have occurred within the mobile space.


“Mobile and social innovation is so torrid right now. You can’t move forward at a trot, because the industry is moving at a gallop. If you move ahead at a steady pace, you will fall behind,” Galloway said.


L2’s second annual Digital IQ Index ranking specialty retailers according to their online competence was released in August. It reported that two-thirds of retailers now have mobile sites, versus just 25 percent a year ago.


But if 2011 was the year of m-commerce, 2012 is sure to be the year of Facebook, or F-commerce.


Gilt Groupe launched F-commerce in August with a Facebook store, allowing fans to purchase directly on the medium using their Gilt.com user names and passwords. Oscar de la Renta became the first luxury brand to launch an F-commerce initiative contained entirely on the social medium in November in conjunction with social commerce solution 8thBridge. It’s not the first high-end fashion company to implement an F-commerce component, but it is the first to offer a commerce experience from beginning to end without leaving Facebook.


Bulgari launched F-commerce in May with jewelry that retailed for $12,000 and up, and Chanel did a limited time, prerelease F-commerce offer for its Rouge Coco Shine for fans in April. In both cases, although browsing, shopping and putting in cart occurred on Facebook, actual checkout was done through each brand’s e-commerce site.


“Almost 100 percent of brands cite Facebook as a source of upstream traffic,” Galloway said, pointing to Burberry as an example of the medium’s impact. “[Burberry] is getting more traffic from Facebook than Google. It’s the largest source of traffic to its site. Brands are transitioning from spending money on Google into Facebook programs. All of this [Facebook] traffic and investment is leading toward commerce.”