Skip to content

Thriving in Mobile — What Merchants Need to Consider


Mobile is currently the priority for many businesses, which is not surprising given that nothing else today is driving more commerce growth. Although principles gleaned from traditional eCommerce extend to mobile commerce, merchants must adapt the customer experience and operating model in order to thrive. And that includes adapting their approach to payments.

In a previous blog, we talked about the ways in which a merchant can optimize their domestic eCommerce business, and the challenges that they face when pursuing this growth trajectory. Here, the focus is on the growth potential of the mobile channel, and the specific considerations that merchants should be aware of when expanding into the mobile channel.

The mobile opportunity for merchants

There are now 8.6 billion mobile devices worldwide, which is 1.2 devices per person. And they are increasingly powerful devices: 2016’s iPhone is more powerful than 2006’s iMac, has similar screen resolution, and a much faster internet connection. Nearly 80% of mobile users in developed markets use a smartphone and analysts expect 70% of the world’s population to have a smartphone by 2020.

Consequently, mobile commerce is outgrowing traditional eCommerce, and has really exploded over the past five years. Notching only a single digit contribution to overall eCommerce (desktop plus mobile commerce) in 2010, mobile now accounts for more than 50% of eCommerce in the U.K. and China, 33% in the U.S., and over 20% in many other European markets. Mobile is likely to continue outgrowing desktop-based eCommerce into the future.

There are similarities to desktop-based eCommerce, especially when conducted via a mobile web browser, but mobile’s unique form factor enables many other possibilities. Mobile wallets can enhance payment security by authenticating all transactions with a PIN or by leveraging biometric and other sensors. Mobile payments can also be more convenient by enabling contactless in-store payments or one-click online payments. Loyalty programs can be layered into transactions, receipts can be digitized, and mobile wallets will one day automatically select the most appropriate card for a given transaction.

Mobile apps for retailers can enhance the shopping experience and improve conversion rates. And while these apps are usually not strictly payments tools, their viability often relies on embedded payments. Examples include mobile self-checkout so shoppers can avoid lines, or product review and price check services, which act as advertising tools.

The importance of mobile eCommerce to a merchant is driven by a number of factors

Sector: Certain sectors - including gaming, digital goods, and travel - are mobile by nature and tend to lead mCommerce adoption. Mainstream verticals like electronics, apparel, and general retail are now seeing higher acceptance driven by omni-channel initiatives.

Purchase behavior: Merchants experiencing high frequency and low average transaction values tend to lead mobile payment. Classic examples include Starbucks, as well as European and Asian public transit systems.

Customer demographics: Merchants with young, urban, and tech-savvy customers have higher mobile service demand, as those individuals tend to be early adopters and find mobile shopping more convenient than desktop or laptop-based eCommerce.

Smartphone penetration: Modern smartphones are dramatically more capable and user-friendly than their predecessors, fully enabling mobile commerce. In most European markets smartphone ownership is well over 50% and is 80% in the U.S. and 88% in South Korea. Mobile commerce still occurs in markets dominated by feature phones but is an SMS-centric experience enabled by closed-loop carrier-based mobile payment systems.

Challenges and solutions when enabling the mobile channel

Merchants must consider the unique challenges selling via mobile brings to the customer experience. Not only is the screen smaller, but hover-over design elements, pop-up windows, fixed-size iFrames, and other elements may not work well on mobile and can undermine checkout conversion. Shoppers are also more likely to be on the go or multi-tasking which means they are more distracted during the shopping and checkout process. All of this results in checkout completion rates that are about 40% lower on mobile than desktop.

Mobile apps are one solution to combat the low conversion challenge. Apps allow merchants to design “pixel perfect” branded experiences and unlock unique capabilities such as device functions (e.g., camera or biometric scanner) and leverage mobile wallets like Apple Pay. However, apps have their own challenges, specifically, how do you incentivize consumers to download and habitually use it?

Whether a mobile-optimized online shop or an app, strong design and a smooth checkout process are key to effective commerce. This importance is illustrated by the fact merchants often focus on payment methods that do not require external validation factors such as 3-D Secure. For example, many retailers enable PayPal for their mobile sites but exclude it on bigger screens for cost reasons.

Mobile creates unique payments challenges simply because what works on a 15-inch computer monitor and keyboard rarely works well on a four-inch touchscreen. Pages displayed incorrectly on mobile, complicated payment forms, 3-D Secure redirects, and pop-ups all increase checkout abandonment. Mobile requires responsive payment pages and one-tap payment capabilities via saved payment profiles or digital wallets. Merchants should therefore extend smart checkout tools, such as card vaults, from the online environment onto mobile devices, as well as extending the base of payment methods to include relevant mobile wallets.


The whitepaper, “Fast-track merchant growth paths in eCommerce,” discusses the five key merchant growth paths, and is supplemented by use cases and best practices. Download it from