For major retailers in any industry, a new digital monetization wave is coming: mobile commerce.  To date, the impact of mobile on commerce has been primarily digital advertising (describing, for example, much of Facebook’s current market value), which will of course continue to be important.  While mobile commerce is still nascent in the U.S., penetration is already dramatically increasing.  One just has to look to China, where Alibaba now generates over 42% of its sales ($4.2 Billion per quarter) via mobile commerce.  All this is driven by, at its core, the fact that marketers would rather sell than advertise.

Why will mobile commerce become so important so quickly?  Today, over 90% of total retail sales are transacted offline (less than 10% is ecommerce).  However, most of the offline retailers have concentrated on developing their online presences and have essentially ignored (at least in applying modern technical tools) that there is an important consumer need still being satisfied by offline - call it touch and feel or local.  At the same time though, customer engagement for the offline retail world is limited by the lack of significant information about customer behavior on a local basis and, for most, the lack of dynamic customer databases. 

Despite this, mobile’s usage for shopping is growing and already high – for instance, mobile accounts for 70% of Facebook revenue and 74% of Facebook users use mobile to aid in their shopping experience, usually by sharing with friends.

Why will this be a massive trend? Mobile commerce has the potential to “Internetize” the offline world, allowing users to treat their customers with the same real-time rhythm and customer targeting which today exists only on Desktop Internet. So the growth rate of mobile commerce will primarily stem from its adoption by the offline world.  This, in turn, will be driven by the imperative that everyone will need to embrace mobile commerce because, if you don’t, your competitors will have a distinct and leveragable advantage in local customer knowledge and engagement. 

But for mobile commerce to be effective, it needs three enabling capabilities:

• Payment systems - which are now being developed on multiple fronts
• Selling apps - which will be facilitated by the spread of smart phones, effectively in the hands of everyone by year end
• And, significantly, a massive source of new customer information, local insight - which is where companies like Gravy fit in

The local, offline insights Gravy delivers (your customer information derived from a simple SDK embedded in your mobile app) will be the equivalent of online data for how your customers/potential customers behave (along with attitudinal additions­ in a local environment).  Said again, this information is imperative for effective local marketing and for the building of dynamic customer databases.  A simple demo from Gravy can establish the value of this new form of customer data for your business.