Mobile Commerce and Payments: Not Quite Ready For Prime Time?

Published March 2012 Analyst: David Juman


Mobile Commerce and Payments: Not Quite Ready For Prime Time?

Some of the biggest players in technology and telecommunications – including Google, Visa and Verizon – are battling to develop proprietary mobile payment solutions. Such solutions leverage Near Field Communications (NFC) technology to enable consumers to make purchases with just a wave of their phone. But a recent Phocuswright study reveals that many travelers are apprehensive about mobile transactions – through this type of NFC payment mechanism, as well as by supplying their credit card information over the mobile Web.

According to Phocuswright's Mobile Hits the Mainstream: Leisure and Business Travel Trends (a Global Edition publication), almost half (49%) of online leisure travelers who use mobile phones are either very or somewhat uncomfortable making mobile purchases that require them to enter their credit or debit card number. The same percentage (49%) is similarly uncomfortable about completing purchases by using a mechanism in their phones. These figures suggest that simply altering the payment logistics may do little to alleviate lingering anxiety over mobile transactions.

"Any mobile innovation that taps into the consumer's desire for instant gratification will inevitably catch on," says Carroll Rheem, director, research at Phocuswright. "But for now, there is substantial apprehension around mobile commerce and payment – such as a fear of mistyping credit card information, or concern about what happens if you lose your phone. The mobile marketplace needs time to mature before these concepts gain traction with a mainstream audience."

Phocuswright's Mobile Hits the Mainstream: Leisure and Business Travel Trends, is a multi-component study that examines how U.S. leisure and business travelers are incorporating mobile into their everyday lives, as well as when they travel. Along with baseline metrics that detail smartphone adoption and mobile Web usage, this report provides in-depth analysis of how consumers use smartphones across three distinct phases of travel – research/shopping, booking and post-purchase activities. In addition, the study focuses on key travel segments (air, hotel, car and local activities), and outlines consumer behavior by channel preference (websites versus apps) and timing of activities.

Report topics include:

  • Smartphone adoption rates by leisure and business travelers, including smartphone penetration by age and operating system, and future purchase intentions
  • Key metrics on mobile Internet usage, such as frequency of usage, as well as situations and settings in which travelers access the mobile Internet
  • Analysis of the types of activities that travelers engage in via the mobile Web, along with their attitudes toward functions that involve location-sharing, providing personal information, conducting financial transactions and more
  • Travel-related activities conducted by leisure and business travelers via mobile phone, including research, purchase and post-purchase activities
  • Detailed examination of how leisure and business travelers use smartphones and the mobile Internet to plan and book travel products, including air, hotel, car rental and local activities
  • Use of mobile websites versus applications for travel-related activities, including types of sites and apps, factors that drive usage, frustrations and interest in future mobile Internet capabilities for travel
  • Leisure and business travel spend by smartphone ownership, operating system and mobile booking profile
Phocuswright's Mobile Hits the Mainstream: Leisure and Business Travel Trends (US$895) helps companies understand travelers' smartphone-related attitudes and behaviors, so they can effectively engage them and compete in this rapidly evolving marketplace.