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Smartphone Owners Increase Handset-Based Spending

Smartphone owners in the US are becoming more comfortable shopping and buying from their mobile handsets, but poor mobile site functionality is still a turn-off for many would-be purchasers, according to the Q309 results from Compete.com’s Smartphone Intelligence study.

The quarterly research, which explores how consumers use their iPhones, Blackberrys, Android devices and other smartphones, found that 37% of smartphone owners have purchased something non-mobile with their handset in the past 6 months.

Compete said its findings suggest that mobile commerce (m-commerce) is poised to “explode” in 2010, especially as manufacturers become more attuned to understanding individual consumer motivations, demographics and the handsets they use.

“We’re seeing notable behavior differences across devices, so, for example, users of the Android operating system share different characteristics than Blackberry and iPhone enthusiasts,” said said Danielle Nohe, director of consumer technologies for Compete.

The study also revealed that users of Apple’s iPhone appear to be more willing to spend higher dollar amounts, in general, on a single item than users of other popular smartphone models:

Additional study findings:

• 19% of total smartphone owners have purchased music from their device, 14% have purchased books, DVDs, or video games and 12% have purchased movie tickets.
• The most popular mobile shopping-related activities are still research related. Some 41% of iPhone users and 43% of Android users are most likely to check sale prices at alternative locations from their mobile phones while they are shopping.

• The second-most-likely activity is accessing consumer reviews, with 39% of iPhone owners and 31% of Android owners investigating reviews from their handset before they purchase.
• Users of Apple’s iPhone are more willing to spend higher dollar amounts on a single item than users of other popular handsets:

Mobile Site Optimization is Mission Critical

While m-commerce is poised for explosive growth in 2010, the study found, however, that consumers are still more likely to abandon mobile purchasing on sites that are not optimized for the on-the-go experience, similar to shopping cart abandonment in the early days of e-commerce. Compete said that 8% of smartphone owners who tried to purchase a product on their device were unable to do so. Nearly half (45%) of those who abandoned the process say they did so because the site would not load, and an additional 38% left the site because it was not developed specifically for smartphone users.

“Retailers are beginning to recognize that smartphone use is no longer limited to an exclusive group of tech-savvy consumers,” added Nohe. “As these devices proliferate - and people grow more comfortable transacting, site owners must redesign around mobile shopping ease-of-use.”

About the survey: The research combines survey-based consumer insights with behavioral data (through online click stream data) to reveal how smartphone owners are using their phones, the sites they visit on the mobile Web and what they like and dislike about their phone and experiences.