IBM: Mobile Shopping, Up 28%, Sets Trend for Holiday Season

IBM said results of its latest IBM Retail Index show mobile shopping up 28 percent and retailers prepping for online holiday shopping.

According to the IBM Online Retail Index, Q2 2013 consumer online spending was up 15 percent over the second quarter of 2012, with mobile shopping accounting for nearly 20 percent of overall sales–spurring retailers to begin to prepare for how mobile shopping might impact the holiday season.

At 20 percent of overall online sales, mobile spending rose 28 percent during the quarter, according to IBM. Led by big gains in health and beauty and home goods, mobile continued to dominate. In comparison, in-store sales rose 4.6 percent in the second quarter, according to the U.S. Department of Commerce’s Census Bureau report.

With online sales heating up with the summer temperatures, IBM officials said it's never too early for retailers to start thinking about the holiday buying season–even in July. To help them prepare, IBM released its Sixth Annual Online Retail Holiday Readiness Report to reveal the most influential commerce trends that retailers should expect to see this year, the factors driving them and how retailers can prepare before Black Friday and the holiday shopping season takes full effect.

“It’s ironic that during the dog days of summer when temperatures are nearing 100 degrees in some places, we’re talking about the holiday season, but now is the time that retailers are getting locked and loaded for the holidays,” said Jay Henderson, global strategy program director for IBM Smarter Commerce, in an interview with eWEEK. “One of the biggest and most obvious trends we got from the latest index is the need to seize this opportunity around mobile.”

Henderson said retailers need to do a better job of providing a better experience for shoppers on mobile devices and many are working to do so–providing things like store maps and guest WiFi programs for in-store shoppers and optimizing for tablets for users at home doing “couch commerce” on tablets, he said.

“We’re seeing retailers come out with versions of their Website designed for tablets,” Henderson said. “Retailers are adjusting their site design by doing things like adding more space between selections on drop down menus to allow for easier finger navigation on tablets.”

Meanwhile, some of the key findings of the IBM Online Retail Index include that online shopping growth outpaced in-store by more than three times, 15 percent to 4.6 percent; Mobile sales near 20 percent, a 28 percent increase over Q2 2012, with the Apple iPad generating more online traffic than any other mobile device; health and beauty sales increased more than 55 percent over Q2 2012, as warmer temperatures call for changes in personal care routines and an increased need for sun protection items; and as U.S. home goods sales rose across all channels in the second quarter and stores looked to clear out summer merchandise to make room for fall goods, online sales of home goods increased by more than 56 percent year-over-year.

Specific highlights from IBM’s 2Q analysis include that a recovery in housing fueled home goods online spending. According to the U.S. Commerce Department, new home sales in May were up 29 percent. This growth is fueling more home remodeling projects, with online home goods sales up 56 percent. Average order value online reached $413.23, a 26 percent increase over Q2 2012, with the iPad generating more traffic than any other mobile device.

Also, as retailers look to purge their stores of summer merchandise and prepare for the fall season and the back-to-school shopping frenzy, consumers are reaping the benefits of deeper discounts. Reduced prices helped to grow online apparel sales, which saw a 21 percent increase. Health and Beauty saw even higher gains. Although average order value was down almost five percent from Q2 2012, online sales were up more than 55 percent over the same period, indicating deeper discounts and promotions on summer merchandise.

Moreover, as online retailers continue to invest in mobile technology and court mobile customers, online spending continues to advance. Retailers are looking to take a MobileFirst approach to customer shopping. Consumers are using their mobile devices to research products both at home and in the store–the number of consumers using a mobile device to visit a retailer’s site reached nearly 27 percent, up more than 35 percent year over year. Apple continues to dominate the mobile device experience, with the iPad generating more traffic than any other mobile device at close to 11 percent of retail traffic–a 60 percent increase over Q2 2012. The iPhone closely follows, generating 10.5 percent of traffic, with Android devices generating 7.1 percent.