£53 Billion A Year In UK Mobile Payments By 2024June 2, 2015
New research, which has been completed on behalf of Barclays, by retail analysis agency Conlumino, has predicted that within ten years, UK mobile payments will account for one pound in every seven that are spent. The total annual spend by mobile is also expected to exceed £53 billion by the year 2024, with mobile payments contributing to 13.7% of retailer takings.
£53 Billion A Year In UK Mobile Payments By 2024
Managing Director and Head of Retail and Wholesale at Barclays, Richard Lowe hints at the advancement of mobile payments as being the potential nail in the coffin for desktops and laptops, stating:
“While it may be premature to sound the death knell for desktops and laptops nearly half of consumers claim to be shopping far less on these devices thanks to mobile.”
With new gadgets being released onto the market all the time, such as the Apple smartwatch, the trend for people shopping and making purchases on their mobile devices is only set to continue, so it would be no shock to learn that fewer transactions are being made via more traditional methods.
It is commonly stated that the increase of mobile shopping will do no favours to the high street. However, this is something that Lowe disagrees with; instead he believes it is incredibly important for a retailer to have a physical presence stating that: “the development of hybrids such as click and collect has conclusively demonstrated that stores can be supported rather than hindered by the growth of digital commerce.”
Lowe recognises that practices, such as ‘showrooming’, which is where shoppers browse products in-store but then head away to make their purchase online, will lead to an increase in online sales.
Because of the increase in online sales, some retailers might think it’s not worth having an offline presence anymore because they simply can’t compete with the online competition. However, it is important to note that shoppers will often purchase from the online counterpart of the offline store they visited because the online shop is able to offer the same goods at lower prices due to a reduction in overhead costs.
It is important to note this trend, especially because approximately three quarters of shoppers will be using their mobile devices whilst out physically shopping; therefore if you don’t have both an offline and online presence, you may well miss out on making the most of this ‘showrooming’ opportunity.
Vaux emphasises the importance of keeping up with technology trends, stating: “Retailers must cater for the mobile consumer in order to remain relevant.” However, the research conducted for Barclays found that many retailers are not yet fully catering to their consumers, with 70% stating that they did not have a mobile offer (i.e. website or application) and that only 3% believed that they were prepared for mobile payments.
It is also worth retailers noting the research recorded that over half of its participants would like shops to offer free Wi-Fi. Times are changing and consumers expect to be connected at all times; and with connectivity helping drive online sales, technology like Wi-Fi and mobile payments should definitely be part of your commercial strategy for the coming months, else you risk losing out to your competition.