Nearly one in every £10 spent with UK high street retailers comes from mobile channels, totalling an approximate turnover of £45 billion in 2011, research sponsored by cloud-based financials/ERP software suites vendor NetSuite, has revealed. With 23% growth expected, m-commerce turnover in 2012 is predicted to reach £56 billion.
The research is based on economic models provided by the Centre for Economics and Business research (Cebr) and primary research of 200 UK high street retail managers, including seven of the top 10 retailers in the UK conducted by Vanson Bourne and is published by NetSuite.
The report reveals that despite the recent return to recession, UK retailers have a positive outlook for the year ahead, with 87% of retailers predicting positive revenue growth and an average expected revenue increase of 10%. M-commerce is expected to play an increasing role in achieving this. 80% of high street retailers now have a mobile-optimised e-commerce site or smartphone app, or plan to build one in the next year.
This group expects m-commerce revenues to increase by a quarter (23%) over the next year. Based on the proportions of retailers using m-commerce and the proportion of revenues derived from it, total turnover from m-commerce is predicted to increase to £56 billion over the next year.
With 45% of the UK’s population now owning a smartphone (Google / Ipsos, Jan 2012), retailers need to ensure they can serve customers via these new platforms, and not be overtaken by competitors. 56% of retailers view new sales channels as a main driver of business growth over the coming year, and just over half (52%) view competitors’ m-commerce apps and sites as a threat to their sales. Retailers also have their eyes on social media, with two-thirds (65%) expecting sales from social media venues to become an important consideration over the next 12 months.
“The proliferation of smartphones and tablet computers is rapidly transforming consumers’ shopping behaviour,” says Roman Bukary, Head of Industries Marketing, NetSuite. “People are now used to making purchases via their mobile devices, whether it’s for the latest app from an appstore or the weekly grocery shop. Retailers need to take advantage of this channel to meet the modern expectations of their customers, and not get left behind. However, the challenge for retailers is to integrate the mobile channel without incurring huge costs or complexity, so they need a single solution which can manage all transactions and associated customer interactions with consumers and other businesses regardless of the touchpoint, whether this is the website, smart phone, social media or in the store.
“Social media also presents great sales opportunities for retailers if handled in the correct manner,” continued Bukary. “Being able to monitor and react to social ratings, reviews and conversations and devise a social strategy, with personalised product recommendations, rich media management, mobile device payments, and credit card payment processing will help retailers realise further growth opportunities”.
In light of these challenges and opportunities, NetSuite has launched NetSuite SuiteCommerce- a new commerce-aware platform that provides a central system to manage all transactions and associated customer interactions with consumers and other businesses regardless of touchpoint (website, smart phone, social media site, in-store, etc.) supporting Commerce as a Service across multiple channels. For more information, please click here.
Colin Edwards, economist at CEBR, added: “In the context of a difficult macroeconomic climate, retailers’ expectations seem very positive and may ultimately prove to be somewhat optimistic – but it’s clear that the importance of alternate revenue streams such as m-commerce will be a crucial component for retail success moving forward.”
For more insights, including perspectives on the potential for social commerce, international sales, and for insights from the suppliers to the UK high street, the wholesale/distribution industry, please download the full report “The Retail and Wholesale/Distribution Trends Report,” here.
