Smartphones are blurring the line between channels, says eBay CEO
Recent advancements in smartphone technology have altered the face of conventional retail more that other technology developments in the past 20 years, says eBay president and CEO John Donahoe.
"What’s happened over the last 12 to 18 months is the blurring of the lines between ecommerce, mcommerce and retail," he told an audience at the Open Mobile Summit in San Francisco, according to InternetRetailer. "Retail and ecommerce are becoming one. Consumers don't make a distinction between the two."
For eBay in particular, growing smartphone usage has forever changed the company's direction. Utilizing its payment service provider PayPal, the online auction business is working on several mobile services that smartphone owners will be able to use. For example, one service would enable users to conduct local searches and then buy products through their phones at the store.
The key, Donahoe explained, is providing convenience for consumers. By offering them the ability to purchase products how and when they want to do it, rather than limiting them to a specific channel, retailers can achieve the type of flexibility most shoppers are looking for. If consumers are using phones, retailers need to allow them to make purchases through these devices.
"This is being consumer-led, technology-enabled, and will create winners and losers," he added. "The mobile phone blurring the line between online and offline commerce has profound implications for retailers and merchants around the world."
Instead of viewing mobile devices as a whole new platform, Donahoe suggests merchants think of them as simply another web browsing tool. His company is expecting to sell $5 billion in goods to consumers accessing the site through smartphones and tablets. Meanwhile, PayPal will process more than $3.5 billion in payments from mobile consumers.
Still, few retailers are ready for the influx of mobile traffic. While nearly half of retailers have mobile applications designed for smartphone or tablet users, a recent survey conducted by Retrevo suggests these apps aren't providing a satisfactory shopping experience. According to the report, only 14 percent of consumers who have downloaded a retail app have used it to make a purchase.
"Retail industry experts unanimously agree that the mobile economy will revolutionize commerce over the next five years, but there is no indication that America's top merchants are even close to ready – or viewing mobile technology as a positive force that can be used to their advantage," the report notes.
