Commentary

Mobile Investments by Smaller Retailers: 54% Device Optimization, 51% Android App, 50% iOS App

Some online retailers are feeling good about their revenue prospects this year while others are looking over their shoulder fearing new market entrants.

While we see and write about many commerce-related studies, a new one focused only on relatively smaller, online retailers.

The majority (75%) of these retailers have a positive outlook on retail in 2015 with most (72%) expecting their online revenue to increase by 17 percent, according to the 2015 Retail Growth Outlook.

The study was conducted by research firm Edelman Berland for eBay Enterprise. It comprised a March survey of 1,000 online retail professionals who have ecommerce and online marketing responsibilities in online retailers with revenue between $3 million and $250 million.

The retailers would be classified as Tier 3 retailers, if using the categories established by an earlier study by IHL, which examined current and future beacon usage, which I wrote about here recently (37% of Large Retailers to Deploy Beacons This Year).

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That Tier 3 group, along with the major retailers in Tier 1, are looking at the largest beacon implementation growth this year, according to the IHL study.

The Edelman Berland study examined projected revenue forecasts and critical decisions that the so-called Tier 3 retailers will make this year to achieve anticipated growth.

The top areas seen as fueling growth include online engagement and expansion, closely followed by mobile commerce. Here are the areas that will fuel growth, according to the study:

  • 33% -- Online engagement
  • 23% -- Global ecommerce expansion
  • 22% -- Mobile commerce
  • 22% -- Digital targeting
  • 22% -- Product innovation

In terms of where these smaller retailers are investing in mobile, device optimization leads the way. Of retailers investing in mobile this year, here’s where they plan to put their money:

  • 54% -- Mobile device optimization
  • 51% -- Building a unique Android application
  • 50% -- Building a unique iOS application
  • 46% -- Mobile application development

One of the likely drivers in the investment is fear of what others might do. More than one in four retailers (28%) are afraid of new competitors entering the market.

So while many of these smaller retailers expect to grow this year, many will be doing it while looking in the rear-view mirror.

The good news is that the retailers who are investing in improving mobile commerce seem to have their eye on the ball.

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