Mobile Commerce Insider Featured Article

July 08, 2014

Goods & Commerce, Ancient Ideas in a Digital Age

The twentieth century introduced drastic change to the method in which we execute transactional commerce with one another, namely the fruition of the credit card.  With merely a simple piece of plastic, the currency system relied on by humanity for thousands of years was altered relatively overnight.  Now, with the advent of mobile devices and their ever increasing integration into our daily lives, commerce has been given another opportunity to evolve - from plastic to digital with mobile payments.

Is it really outlandish to speculate that such an evolution is possible, when in fact just 100 years ago an evolution of equal or greater magnitude, pertaining to the world of currency, took place?

Research aggregator MarketsandMarkets doesn’t think so, stating that by 2019, the annual mobile commerce gross is expected to reach $467.3 billion, a staggering advance from being just $116.1 billion in the present year.  In the wake of mobile financial transactions, including mobile banking, ticketing, billing, and card information storing, these numbers should surprise no one; mobile payments make the lives of the consumer easier.

On Black Friday 2013, the proverbial Eldorado of shopping days relative to sales and price cuts, was reported by IBM’s Benchmark real-time reporting unit as seeing almost 20 percent of its money exchange comes as a result of mobile payment utilization.  Here is the perfect allegory to just how easy digital commerce is making consumer purchasing: on the most dangerous, most crowded shopping day in America, all a lucky few had to do was wake up, sit on their couches, and click through a few check-out menus.

Zuum is one such mobile payment service taking advantage of rising trends in digital commerce.  Launched in Brazil by both Vivo and Mastercard in 2013, Zuum offers customers a pre-paid account right on their phone, with an optional physical card linked in upon request (provided by Mastercard).  This product was released in over 50 cities and, of each one, expeditious assimilation took place in Bahia, Brazil’s fourth most populated state.  While such traction is likely a result of its seamless integration of any and all necessary financial transactions in one easy location, perhaps Zuum’s greatest asset is its compatibility with both smartphones and earlier GSM-only access.

Though the future of mobile payments seems most certainly assured, there are some that would argue that total, seamless integration finds itself merely a distant aspiration.  A study from Bloomberg BusinessWeek, for example, reports Google as having spent $300 million developing and deploying the Google Wallet.  For their efforts however, Google sees loss in almost every subsequent transactions due to lofty card company fees.

A Bain & Company report, based on a survey of 25,000 consumers from the United States and Europe, found that almost twice as much money is being spent by customers when choosing to shop online versus in-person.  While the way to perfectly symbiotic mobile transaction might not be there yet, the clear and lucid truth is that the will certainly is.   




Edited by Stefania Viscusi



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