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Mobile Commerce in India: BuzzCity's Report
Mobile Commerce in India: BuzzCity's Report
By: Sahil Shah

Mobile is growing in India with more than 800 million subscribers across the country. The advancement in terms of adoption of smart phones with 3G enabled services is happening at a rapid pace. This of course has opened up the gates to mobile advertising, mobile application development and mobile commerce in India. According to BuzzCity's latest report, India is top performing mobile advertising region in the whole of Asia. The growth in mobile advertising globally is tremendous with ads served on a year-on-year growth of 139%. With respect to some number crunching, more than 126 billion ads were served in 2011, compared with 52 billion in 2010.

The report analyzed consumer behavior and attitude towards mobile commerce and payments in specific and here is what were the findings:

  • 35% of users aren’t aware of the basic mobile transactions available on their phone. This amounts to a heavy audience who is still uneducated about the basic benefits that they can avail of
  • Unlike the ratio in generic Internet adoption, the demographics are very different in mobile surfing. There are nearly as many women as men using the mobile web which is fairly surprising
  • The proportion of mature users across the globe is growing; 15% are now over 35. The influence of this group is disproportionately high when mobile purchases are made
  • In the past six month, users aged over 35 years made 19% of travel-related purchases, 23% of grocery purchases and 21% of household utility payments globally

When it comes to the type of transactions that are being made these are wide-ranging:

  • Services to stay connected - for example payments for phone credits are high in countries where the mobile is the primary point of access to the internet.
  • Entertainment and lifestyle – items such as books, music and movies for home delivery as well as gadgets are all regularly purchased items, notable are Nigeria (31%), India (28%), UK (20%) and US (14%) all avidly buying these via their phones.
  • Travel – consumers are keen to use their handsets to buy tickets and source hotel accommodation with growing usage in Saudi Arabia (21%), France (13%), Germany (11%), India (14%), South Africa (11%) and UK (10%).

These numbers are fairly impressive but lack of awareness of the tools and services available (35%), and concerns regarding security (27%) are two major concerns for the m-commerce industry. Besides these, consumers will adopt this platform more so due to the retailers providing reassurance on security, simplicity and the services available. Globally,users still remain reluctant to engage in remote transactions, with 39% preferring to pay in person, and 21% preferring to charge purchases to their phones.

KF Lai, CEO of BuzzCity stated that, “There are three missing elements, crucial to widespread adoption of mobile commerce. They are communication, education and security. Users are not currently aware of the services out there. When they do come across such services, these simple processes are presented in a very confusing way. Banks and retailers will need to provide their customers with clear and unambiguous assurances about security.”

The study showcases some trends and forces in the mobile advertising industry in India as well. India continues to dominate the charts throughout 2011, serving over 32 billion ads on mobile in the course of the year, to over 93 million unique users per month too. The report also compared major Internet advanced countries including India. This time, last year, just three countries (India, USA & Indonesia) were serving in excess of a billion ads a quarter. However, by the end of 2011 another seven countries had broken into the Billion Club, which includes UK, South Africa, Mexico, Saudi Arabia, Vietnam, Canada and Thailand. This states the fact that mobile advertising is just growing at a fast rate across all borders.

Mobile commerce is growing across borders which is a clear sign of how easy and simplicity of the medium is being explored. Besides educational and security barriers which I predict will be cleared out soon, there seems to be no other hurdle that the industry will have to tackle. Marketers are keeping a close watch on how the medium progress so as to make the maximum out of it. Brands in categories like e-commerce, online ticketing, banking, gaming, etc. have huge scope in this industry if they will become early adopters. Do let us know in the comments section as to what you think about this medium and how far it will grow in India and across the globe.