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Retailer results highlight mobile's growing importance

In what the retail industry dubbed 'super Thursday' this week, a variety of the UK's leading retailers from a wide range of sectors provided trading updates – and one of the common trends reported was strong mobile sales growth.

Over the last year retail sales from smartphones and tablets have grown rapidly, with figures released this month from e-tail trade organisation IMRG and consultancy group Capgemini showing that sales through mobile devices now account for more than 23% of online sales.

The percentage of online sales completed through a mobile device has reportedly doubled in the space of a year, growing from 11.6% in the second quarter of 2012 to 23.2% in Q2 2013.

Notable mCommerce updates from retailers announcing trading updates this week included the revelation from Home Retail Group's Argos that its second-quarter sales growth of 2.7% was supported by strong sales in mobile commerce, which now account for 17% of total Argos sales.

This was up from 7% for the same period last year, and the high street retailer attributed the jump in mCommerce to the ongoing development of its mobile and tablet apps. Indeed, departing Home Retail Group CEO Terry Duddy suggested that Argos "continues to build on its digital leadership" as a central part of its wider strategy.

Elsewhere, homeware retailer Dunelm Mill reported like-for-like sales growth of 1.7% in its full year trading, with total revenues at £677.2 million. Multichannel development continued to be a strong driver of sales, and online and mobile accounted for 4% of total business.

Providing an update on Dunelm's multichannel investment, CEO Nick Wharton said: "Development of the core website included the redesign of our homepage as well as key product pages where customers "land" following an internet search.

"We have also introduced PayPal as a payment alternative and optimised our site for tablet users in response to the rapid increase in the number of customers accessing our site from these devices. Developments such as expert guides, better recommendations for complementary products and enhanced alternative images also ensure that our website stimulates interest, communicates our expertise and provides added value."

Department store chain John Lewis, which is widely regarded as a leader in ominichannel retail, a term that has come to define how retailers must serve customers and neatly link their businesses across all platforms, also announced financial results on Thursday.

It said that half-year like-for-like sales were up 5.1% and total sales reached £1.71 billion. As part of this growth, the retailer's website has played a key role – bringing in £439.9 million over the six-month period – but it was also acknowledged that more than 40% of traffic now comes from mobile phones or tablets.

John Lewis relaunched its transactional mobile app in July this year, and since then sales via the app have reportedly grown quickly with senior management preparing for what the company anticipates will be "the UK's first mobile Christmas".  

Of course, achieving success in mCommerce involves more than simply launching a mobile-optimised site. Analysts have suggested that the potential for mCommerce is of a similar level to that of eCommerce a decade ago, so for retailers to maximise sales they will need to keep up with consumer demands.

Tina Spooner, chief information officer at IMRG, said that there has been a correlation between the surge in mobile commerce over the past three years and the rise in visitor bounce rates on retailers' websites.

"Higher search volumes will inevitably result in an increase in bounce rates as shoppers will often compare products and pricing across several brands," she explained.

"However, by offering an engaging and relevant experience for customers across all channels, retailers will ultimately achieve the end goal of higher conversion rates and an increase in customer loyalty."

www.IMRG.org