Mobile Warriors Will Account for $127 Bil of Holiday Shopping

Mobile shopping "warriors" (hyper-connected individuals) and mobile shopping "warrior wannabies" (moderately connected individuals) will account for 28 percent or $127 billion of the $447 billion the National Retail Federation (NRF) predicts U.S. consumers will spend this holiday season, according to a new report published by Framingham, Mass.-based IDC retail Insights.

The survey was designed to explore how consumers' growing comfort with mobile commerce (m-commerce) and social media commerce (sm-commerce) will play out in the 2010 holiday shopping season. According to results, m-commerce and sm-commerce are giving consumers greater advantage as they engage retailers on their own terms – even inside the store – within arm's reach of merchandise at the moment of their buying decision.

"MSM-commerce introduces a new consumer shopping model which changes how consumers shop, not simply when and where they shop, as e-commerce has already enabled," said Greg Girard, program director, retail merchandise strategies at IDC Retail Insights. "It is clear that MSM-commerce already has an influence on consumers' perception of brand value and their shopping intentions. We believe the retailers with superior mobile and social media commerce strategies in place will have a decided advantage."

As revealed in the survey, mobile shopping warriors and wannabies represent the vanguard for the new age of m-commerce and, of particular interest, results suggest that the early maturity adult audience is an important part of this vanguard. Adults aged 25 to 44 years comprised nearly two-thirds of the mobile shopping warrior group while they comprised slightly less than half of consumers surveyed. In addition, adults aged 45 to 54 years were the most inclined to use their mobile information advantage; for example, asking for a better price to match one they find on their mobile device while in the store.

For retailers, the impact of mobile shopping warriors will be significant this holiday season -- the survey reveals, across the board that retailers’ m-commerce competence greatly influences consumer perceptions about the brand. Further, an easy-to-use mobile website significantly influences consumers, across all age groups, on where to shop this holiday season. Results also suggest that while the influence of social media outlets on buying decisions is growing, retailers continue to serve as the most important source of information on which consumers make their final purchase decisions. As such, retailers who have met the critical need for consumer-generated Web site content and easy-to-use product information will have the advantage this holiday season.

Other key findings from the IDC Retail Insights survey include:

• More than one third of smartphone-carrying consumers (who represent 24 percent of all U.S. consumers) are ready to use their mobile devices in ways that transform how they shop everywhere and, in particular, how they shop in retail stores.
• New behaviors facilitated by mobility, all of which can take place in stores, include searching for price and product information, checking merchandise availability, and comparing prices at nearby stores, browsing product reviews, and purchasing goods.
• Consumers using multiple channels sequentially as they move from Web to store will give way to concurrent omnichannel behaviors as consumers bring their comfortable use of m-commerce with them into the store. These new behaviors will exert pressures that weaken the store's immediate influence on purchase decisions "at the shelf."
• In general, social media doesn’t have widespread influence on shopping decisions but friends influence one another’s shopping behavior on social networks and sites that have earned consumer trust will influence this behavior as well.

"Consumers' increased comfort with using their smartphones to go online anywhere combined with their plans to use them more in the 2010 holiday season signals the beginning of a significant shift away from the capacity of the store channel to hold sway over consumers as they move to a purchase decision," concluded Girard.

IDC Retail Insights surveyed more than 1000 U.S. consumers aged 19 years and older in September 2010 to determine how consumers will use MSM-commerce as they shop during the 2010 holiday season. The income and demographic profiles of this sample are in line with the overall profile of the U.S. consumer population. About 73 percent of those surveyed are members of Facebook or other social networks and 68 percent own smartphones.

Survey results will be available in a new IDC Retail Insights report, Outlook for Mobile and Social Media Commerce in the 2010 Holiday Shopping Season, to be published in early December.

IDC Retail Insights assists retail businesses and IT leaders, as well as the suppliers who serve them, in making more effective technology decisions by providing accurate, timely, and insightful fact-based research and consulting services.