What is M-Commerce?

M-Commerce, also known as Mobile Commerce, is the term coined in relation to commercial transactions made using a mobile device such as a mobile phone or tablet. These transactions include purchasing goods and services, paying bills or mobile banking transfers.

How does M-commerce differ from E-Commerce?

The two terms can and do overlap one another, as E-Commerce is defined the act of a company or consumer performing a commercial transaction over the Internet, be it via PC or laptop, or indeed by mobile phone or tablet. It is defined as being conducted in one of four ways:

Business to Business (Also known as B2B)

The sale of products or services between two businesses.

Business to Consumer (Also known as B2C)

The sale of products or services by a business direct to their customers.

Consumer to Consumer

Individuals using the Internet to sell their own goods to one another, typically using auction and broker websites.

Consumer to Business

For example, the act of a business buying artistic rights and licenses from individuals for commercial use.

M-Commerce, however, can encompass a whole host of new technologies to enable transactions in new ways.

• Where once they were a rarity and only used by massive online retailers, mobile apps are in use by countless retailers to enable quick purchases on the go, often with a single click.
• Customers are able to use their smart phones to check stock levels at their nearest bricks-and-mortar retailer, or read reviews before choosing to make a purchase.
• Consumers can easily use their smartphone to make contactless payments directly, using software such as Apple Pay or Google Pay.
• Smartphones can hold secure card data in what is referred to as a Digital Wallet, to ensure quick and easy payments.
• Businesses can make direct bank transfer requests using modern technologies such as Open Banking, which customers can authorise using Mobile Banking Apps.
• Smartphones can and will facilitate new security measures such as Strong Customer Authentication (SCA), which will require a customer to take additional steps to prove their identity, such as One-Time Passcodes (OTP) or Biometric Data (facial recognition or fingerprints).

Such is the reliance of many people on mobile technology for performing financial activity, it is estimated that almost 75% of Internet users across the globe will only access the online world via their smart phones, by the end of the next four years

Closer to home, 95% of the UK population had access to the Internet in 2020, and by 2025 this number is expected to rise to 97.5% (source: Statista).

As you might expect, the use of online and mobile technology is far more widespread amongst younger generations, who have been born into the digital age and a massive 96% of people aged 16 – 34 own such a device. It is increasingly embraced by older generations too, with 91% of individuals between 35 and 54, 77% of adults between 55 and 64, and possibly a surprising 53% of adults of pensionable age owning a smart phone or similar device.

These numbers point to an increasing reliance on mobile technology, and mobile technology is driving business growth in all manner of ways, so it makes great commercial sense to join the revolution as quickly as possible.

Whilst you may not necessarily have a full suite of resources to create a fully immersive web app to enable your customers to make purchases with a single click, there are plenty of great ways to ensure you’re moving with the ever-changing behaviours of consumers and the technology that comes with that.

By making your website mobile-friendly (or mobile-first), you can make big changes to the accessibility of your website to the millions of people who no longer use desktop PCs or laptops to access the Internet. Not only that but it will help you to be discovered better by search engines such as Google, who rank mobile-friendliness as a high priority requirement for any website, as it improves user experience.

Use a payment gateway which can integrate with many different shopping cart software, and ensure your gateway can support security measures such as 3D Secure, Verified by Visa, or Strong Customer Authentication (SCA), to ensure your customers feel secure in making purchases on your website with their mobile phone. SOTpay+ by Gala Technology is a PCI-DSS Level 1 payment gateway which can help your business to gain trust and improve the customer experience. To find out more about SOTpay+ and how it can help your company to grow into the M-Commerce revolution, click here.

Open Banking is a great new way for consumers to pay using their Mobile Banking app. It works almost identically to a standard bank transfer, but without the time-consuming headache of setting up a new payee. A business will send a payment request, which will allow a customer to initiate the payment for the exact amount quickly, and because they are required to use a Strong Customer Authentication to access the app, it is very secure for both them and the business. To find out more about how Gala Technology can support your business in incorporating Open Banking into your available payment methods, click here.