7.3 Mobile Shopping, Advertising, and Content-Providing
M-commerce B2C applications are concentrated in three major areas-retail shopping (for products and services), advertising, and providing digitized content (e.g., music, news, videos, movies, or games) for a fee via portals. Let’s examine these areas.
SHOPPING FORM WIRELESS DEVICES
An increasing number of online vendors allow customers to shop from wireless devices. For example, customers who use Internet-ready cell phones can shop at certain sites such as mobile.yahoo.com or amazon.com. Shopping from wireless devices enables customers to perform quick searches, compare prices, use a shopping cart, order, pay, and view the status of their order using their cell phones or wireless PDAs. Wireless shoppers are supported by services similar to those available for wireline shoppers.
An example of food shopping from wireless devices is that of a joint venture between Motorola and Food.com. The companies offer restaurant chains an infrastructure that enables consumers to place an order for pickup or delivery virtually anytime, anywhere. Donatos Pizzeria was the first chain to implement the system in 2002.
Cell phone users can also participate in online auctions. For example, eBay offers “anywhere wireless” services. Vendio and gNumber partnered to provide mobile eBay applications and PayPal introduced its pay-by-phone service. The ShopWiki Mobile Search engine is accessible from a PDA or cell phone browser. It allows you to compare prices of online stores and then buy from any physical location. ShopWiki serves 60 million products from more than 180,000 stores (Comiskey,2006).
M-commerce in Japan is growing exponentially and now represents the largest amount of m-commerce sales in the world. Over 60 million Japanese are buying over their cell phones even while riding the trains, buying, for example, their train tickets. Wireless shopping is popular with busy single parents, executives, and teenagers (who are doing over 80 percent of their EC shopping from cell phones). Cell phones allow direct communication with consumers.
Traditional retailers in Japan, such as 7-Eleven and I Holding Company, have been losing millions of customers to Web shopping companies such as Rakuten Inc. A group of convenience stores and 7-Eleven Japan co. have set up 7dream.com, offering online services for music, travel, tickets, gifts, and other goods to its 8,000 7-Eleven stores in Japan. Meanwhile, pure m-commerce operators such as Xavel Inc. (xavel.com) are growing rapidly, forcing traditional retailers such as Marui department stores to expand their e-commerce to include m-commerce.
According to the Daiwa Institute of Research (reported by Textually.org,2006), impulse shopping accounts for most of the purchases that are done on mobile phones, but only if the users are on flat-fee-based service.
An example of purchasing movie tickets by wireless device is illustrated in Figure 7.3. Notice that the reservation is made directly with the merchant. Then money is transferred from the customer’s account to the merchant’s account.
TARGETED ADVERTISING
Knowing the current location of mobile users (e.g., when a GPS is attached to the cell phone) and their preferences or surfing habits, marketers can send user-specific advertising messages to wireless devices. Advertising can also be location-sensitive informing about shops, malls, and restaurants close to a potential buyer. SMS messages and short paging messages can be used to deliver this type of advertising to cell phones and pagers, respectively. Many companies are capitalizing on targeted advertising, as shown in A Closer Look 7.1.
As more wireless bandwidth becomes available, content-rich advertising involving audio, pictures, and video clips will be generated for individual users with specific needs, interests, and inclinations.
Getting Paid to Listen to Advertising. Would you be willing to listen to a 10-second ad when you dial your cell phone if you were paid 2 minutes of free long-distance time? As in the wireline world, some consumers are willing to be paid for exposure
to advertising. It depends on which country you are in. In most places where it was offered in the United States, this service was a flop and was discontinued.
In Singapore, though, getting paid to listen to advertising works very well. Within a few months of offering the ad service, more than 100,000 people subscribed to the free minutes in exchange for listening to the ads offered by SingTel Mobile (Eklund, 2002). Subscribers to SingTel’s service fill out a personal questionnaire when they sing up. This information is fed into the Spotcast database (spotcastnetwork.com) and encrypted to shield subscriber’s identities – Spotcast cannot match phone numbers to names, for exsample. To collect their free minute – one minute per call, up to 100 minute a month – subscribers dial a four-digit code, then the phone number of the person they want to talk to. The code prompts SingTel to forward the call to Spotcast and, in an instant, Spotcast’s software finds the best ad to send to subscriber based on the subscriber’s profile
SHOPPING FORM WIRELESS DEVICES
An increasing number of online vendors allow customers to shop from wireless devices. For example, customers who use Internet-ready cell phones can shop at certain sites such as mobile.yahoo.com or amazon.com. Shopping from wireless devices enables customers to perform quick searches, compare prices, use a shopping cart, order, pay, and view the status of their order using their cell phones or wireless PDAs. Wireless shoppers are supported by services similar to those available for wireline shoppers.
An example of food shopping from wireless devices is that of a joint venture between Motorola and Food.com. The companies offer restaurant chains an infrastructure that enables consumers to place an order for pickup or delivery virtually anytime, anywhere. Donatos Pizzeria was the first chain to implement the system in 2002.
Cell phone users can also participate in online auctions. For example, eBay offers “anywhere wireless” services. Vendio and gNumber partnered to provide mobile eBay applications and PayPal introduced its pay-by-phone service. The ShopWiki Mobile Search engine is accessible from a PDA or cell phone browser. It allows you to compare prices of online stores and then buy from any physical location. ShopWiki serves 60 million products from more than 180,000 stores (Comiskey,2006).
M-commerce in Japan is growing exponentially and now represents the largest amount of m-commerce sales in the world. Over 60 million Japanese are buying over their cell phones even while riding the trains, buying, for example, their train tickets. Wireless shopping is popular with busy single parents, executives, and teenagers (who are doing over 80 percent of their EC shopping from cell phones). Cell phones allow direct communication with consumers.
Traditional retailers in Japan, such as 7-Eleven and I Holding Company, have been losing millions of customers to Web shopping companies such as Rakuten Inc. A group of convenience stores and 7-Eleven Japan co. have set up 7dream.com, offering online services for music, travel, tickets, gifts, and other goods to its 8,000 7-Eleven stores in Japan. Meanwhile, pure m-commerce operators such as Xavel Inc. (xavel.com) are growing rapidly, forcing traditional retailers such as Marui department stores to expand their e-commerce to include m-commerce.
According to the Daiwa Institute of Research (reported by Textually.org,2006), impulse shopping accounts for most of the purchases that are done on mobile phones, but only if the users are on flat-fee-based service.
An example of purchasing movie tickets by wireless device is illustrated in Figure 7.3. Notice that the reservation is made directly with the merchant. Then money is transferred from the customer’s account to the merchant’s account.
TARGETED ADVERTISING
Knowing the current location of mobile users (e.g., when a GPS is attached to the cell phone) and their preferences or surfing habits, marketers can send user-specific advertising messages to wireless devices. Advertising can also be location-sensitive informing about shops, malls, and restaurants close to a potential buyer. SMS messages and short paging messages can be used to deliver this type of advertising to cell phones and pagers, respectively. Many companies are capitalizing on targeted advertising, as shown in A Closer Look 7.1.
As more wireless bandwidth becomes available, content-rich advertising involving audio, pictures, and video clips will be generated for individual users with specific needs, interests, and inclinations.
Getting Paid to Listen to Advertising. Would you be willing to listen to a 10-second ad when you dial your cell phone if you were paid 2 minutes of free long-distance time? As in the wireline world, some consumers are willing to be paid for exposure
to advertising. It depends on which country you are in. In most places where it was offered in the United States, this service was a flop and was discontinued.
In Singapore, though, getting paid to listen to advertising works very well. Within a few months of offering the ad service, more than 100,000 people subscribed to the free minutes in exchange for listening to the ads offered by SingTel Mobile (Eklund, 2002). Subscribers to SingTel’s service fill out a personal questionnaire when they sing up. This information is fed into the Spotcast database (spotcastnetwork.com) and encrypted to shield subscriber’s identities – Spotcast cannot match phone numbers to names, for exsample. To collect their free minute – one minute per call, up to 100 minute a month – subscribers dial a four-digit code, then the phone number of the person they want to talk to. The code prompts SingTel to forward the call to Spotcast and, in an instant, Spotcast’s software finds the best ad to send to subscriber based on the subscriber’s profile
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