Mobile: How Do I Buy with Thee? Let Me Count the Ways

 
 
By Evan Schuman  |  Posted 2007-09-18
 
 
 

Historically, any major communications or commerce channel is only remembered after the industry agrees on one (or perhaps two) direction.

Think back to the early days of the Web. Ask most people when the Web began, and theyll typically say 1994 or 1995. In truth, Tim Berners-Lee finalized it in 1990, and working systems were already deployed by 1991.

There was a healthy number of users accessing Web sites using nongraphical browsers. Yes, it was painful. I remember searching through the Security and Exchange Commissions database in a text-based browser. If youre ever in the market for a cruel alternative to capital punishment, this would be an excellent choice.

It wasnt until the launch of the first graphical browser—NCSA Mosaic, later changing its name to Netscape Navigator and eventually just known as Netscape—in 1993 that the Web caught on fire.

Its safe to say that the mobile phone e-commerce activities youre seeing today—and certainly any you played with last year or earlier—are going to fall victim to the same amnesia fog that envelopes all of those early Web searches done on Lynx (major early nongraphical browser).

Although the Web had been around for years—and the Internet for much longer—it was the graphical browser that got the industry to agree on one way to create Web pages that could fire the imagination of businesses and consumers.

That defining moment has yet to hit mobile commerce. Forget design and programming issues. There hasnt yet even been broad agreement on how m-commerce is supposed to work.

Lets start with simple payment. Is it based on an RFID chip in the phone, making it one big contactless credit card with a speakerphone? Or is it charged to a wireless telco that is powering it, identified through the phone number?

Some have tried using the phone number as a unique identifier and have it tied into a credit card, authenticated by the user having to either answer the phone at a specific moment or making a call from that phone and then having a limited number of minutes to make a specific purchase.

McDonalds—certainly a heavy hitter regardless of the measurement method—is now experimenting in South Korea with a mobile phone payment method where the phone is physically plugged into a port at a table and requires the downloading of an applet. When the food is ready, the phone rings. If it wasnt McDonalds doing it, I would wonder about the wisdom of a mobile application that requires a physical tether.

Read more here about McDonalds new ordering system in South Korea.

Then there are m-commerce tactics that try to leverage the phones unique attributes, such as its digital camera and almost-real-time chat capabilities.

The camera can be used to "see" two-dimensional (and soon more) images and take certain actions, typically launching a Web browser and going very deep inside a site, requiring a URL much too long to manually key in conveniently. This allows the URL to reflect the exact location of the user at the time of download, helping to identify the effectiveness of a particular ad on digital or physical signage.

The chat capability has the most promise and requires the most retail effort. The potential: A consumer goes into a department store and the stores network identifies the consumer based on the phones number. (With number portability, the number is likely to stay with the consumer longer than the phone hardware will, although neither has especially long lives.)

Knowing that customers history of expensive cashmere sweater purchases, the store messages a 20 percent discount if a purchase is made in the next 30 minutes. Where it gets interesting is if customer service people are awaiting the customers reply at a call center somewhere. He replies, "Maybe, but Im really here shopping for a new refrigerator. If you throw in a 15 percent discount on that, were there." They counter: "Ill give you 12 percent right now, but you need to buy both." "Sold," the customer replies.

Or maybe the phones chat function will be an exchange of questions that would normally have gone to those hard-to-find floor sales reps.

Some recent moves—most prominently from Sprint on Sept. 13—are leading to a limited number of products recrafted to look better on cell phones.

Cell phones have the burden of limited bandwidth and very limited screen size, a deadly combo for any commerce efforts. Thats one reason why McDonalds is experimenting with a tether and the phones ring tone, which conveniently bypass both of the phones biggest problems.

But is such a piecemeal approach—Digby, for example, works only on BlackBerrys and selects a limited number of products to fine-tune for mobile—going to take mobile to the next level?

Mobile commerce is going to get real—there is too much potential and too many dollars for it to die—but its not going to happen with the industry flying in so many directions.

Retail executives need to think carefully about which m-commerce method to embrace. That snazzy ring-tone app may just be the 2007 equivalent of Lynx.

Retail Center Editor Evan Schuman has tracked high-tech issues since 1987, has been opinionated long before that and doesnt plan to stop any time soon. He can be reached at Evan_Schuman@ziffdavis.com.

To read earlier retail technology opinion columns from Evan Schuman, please click here.

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