eCommerce Growth Correlates to Greater Smartphone Ownership

Editor’s note: The following is a guest post by Michael Essany.

It looks like smartphones and shopping are the new peanut butter and jelly.

All signs suggest that this inseparable tandem will continue to fuel tremendous growth in online shopping for 2012 and beyond.

According to the latest projections from Digital Marketer, advertisers are poised to rapidly direct more of their scarce marketing dollars to the mobile platform in response to the undeniable correlation between smartphone ownership and eCommerce.

A Key Player

“Smartphones are a major driving force in eCommerce today,” independent business analyst Mike Randazzo tells Daily Deal Media, “but not just because consumers are making more purchases directlythrough their smartphone.“

Randazzo asserts that greater smartphone ownership is helping eCommerce by creating more productexposure opportunities.

“Many consumers use their handsets in stores to check competing prices online,” he says. “They often don’t pull the trigger until they are back home and infront of their computer or laptop. Regardless, smartphones are a direct contributor and indirect catalyst for eCommerce.”

Consequently, advertisers know that smartphone owners are generally favorable to online shopping. And with Nielsen reporting that 43% of Americans with cellphone service now own smartphones, mobile marketing dollars are about to balloon.

“In 2011,” Digital Marketer reveals, “only 0.9% of advertising dollars went into mobile advertising; however, the mobile ecommerce statistics should start to improve in 2012. With the sheer number of smartphones being purchased, methods for purchasing using smartphones will surely be improved and then advertising should follow.“

The Hype Persists

No shortage of big names are stepping up with bold predictions for what 2012 will mean for smartphones, online shopping, and the anticipated mobile commerce boom.

Just this week, eBay chief John Donahoe revealed that nearly 900,000 new eBay shoppers made their very first eBay purchase in 2011 through the company’s popular mobile apps. That figure represents a 113 percent increase year-over-year for the online auction giant.

Industry-wide, the research shows that eBay isn’t alone when it comes to possessing and trumpeting bold expectations.

A recent survey conducted by Market Strategies International indicates that seven in ten smartphone owners have now shopped or at least browsed for products via the mobile web.

“Smartphone users are shopping and purchasing through their smartphones at the rate we expected. However, we were surprised to see that users are buying physical goods at about the same rate as apps, indicating that the technology is on the verge of widespread adoption,” said Ann Graham Hannon, vice president of the financial services division at Market Strategies.

Conversely, Randazzo believes that the trend will not only continue, it will be aided greatly by the efforts of smartphone makers to increase the size and clarity of their screens.

“I don’t think there’s any doubt about mobile commerce having been hindered in the past by smaller smartphone screens,” Randazzo says. “This will be less of a hurdle in years to come as the screens get slightly larger and shoppers grow more accustomed to browsing and purchasing on their handset.”

Sources: Digital Marketer, Market Strategies International

T-Mobile intros first 42 Mbps smartphones and hotspot

T-Mobile announced on Monday its first two smartphones capable of fully utilizing the operator’s 42 Mbps mobile broadband network. The carrier’s version of the Samsung Galaxy S II and the HTC Amaze 4G, both Android phones, were introduced at GigaOM’s Mobilize event in San Francisco. A new 42 Mbps MiFi, the T-Mobile Sonic 4G Mobile Hotspot was also launched.

The new devices come at a time when the no. 4 U.S. carrier has spent much of this year upgrading its mobile broadband data network. In 2010, T-Mobile boosted the network to 21 Mbps speeds and wasted little time in doubling the network speeds in 2011 with HSPA+ 42 wireless capability and additional backhaul to cell sites. That’s because the carrier is seeing data consumption double every six months.

The increased speeds are helping to quickly transition T-Mobile customers to smartphones that generate increased data revenues. In a phone conversation with Cole Brodman, T-Mobile’s Chief Marketing Office, he told me that “75 percent of the phones T-Mobile sells this year will be smartphones, and of those, 90 percent are Android.”

Without an Apple iPhone, the Android figure makes sense and the overall percent of smartphones sold is higher than the industry, which is estimated to be around 55 percent of all phones sold in the U.S. this year, according to Chetan Sharma, an independent telecom analyst.

As far as the new phones themselves, the Galaxy S II will look familiar as both Sprint and AT&T have introduced their versions. One immediate difference in T-Mobile’s Galaxy S II, aside from the 42 Mbps radio, is a larger, 4.52-inch Super AMOLED Plus display.

The phone also has NFC capability, although Brodman told me the feature won’t be used at launch. Most other specifications are similar or the same: a 1.5 GHz dual-core processor (from Qualcomm, not Samsung), 16 GB of storage capacity with expansion up to 48 GB, an 8-megapixel rear camera, 2-megapixel front camera and HDMI output.

The new HTC Amaze 4G with Sense 3.0 is also a powerful smartphone, using the same 1.5 GHz dual-core CPU but with a 4.3-inch qHD (960×540 resolution) Super LCD screen. However, the HTC Amaze 4G is positioned as a top-notch camera device with simple sharing on the fast HSPA+ network.

The wide aperture f/2.2 camera — good for low-light conditions — uses an 8-megapixel sensor. A few new scene modes, similar to those found on T-Mobile’s HTC Sensation 4G, are included to enhance the image-taking experience:

SmartShot takes five pictures and combines the best attributes of each to capture smiles and eliminate blinking eyes.
ClearShot HDR creates high contrast images.
SweepShot captures wide panoramic views.
PerfectPics intelligently surfaces the best or most meaningful photos into a separate photo album.

The phone also boasts zero-shutter lag, face detection, 1080p HD video capture and a five-image BurstMode. Images can be shared natively to Facebook, Picasa and Flickr.

Those who prefer to use laptops and tablets on T-Mobile’s HSPA+ network may be interested in the Sonic 4G Mobile Hotspot. The 3.88 ounce device shares its mobile broadband connection with up to five devices over Wi-Fi and has a 32 GB microSD card slot to save and share data across the personal hotspot network. A small OLED display shows the number of connected devices, signal strength and battery life, which is estimated at 4.5 hours of continuous use.

Both new handsets will be available for online orders starting Oct. 10 with widespread retail availability two days later. T-Mobile’s Samsung Galaxy S II, is priced at $229.99 with contract and after a $50 mail-in rebate, while the HTC Amaze 4G will cost $259.99 with contract and after the same $50 mail-in rebate. T-Mobile hasn’t set a price for the Sonic 4G but expects it to be available in stores before the end of October.

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Android this week: Galaxy S II first look; Amazon tablet soon; more Hulu Plus devices

Since launching in May, Samsung’s Galaxy S II has been the company’s fastest selling smartphone, even without availability in the smartphone-crazed U.S. That situation is changing as Samsung announced a version for Sprint, AT&T and T-Mobile earlier this month. Sprint’s edition is already for sale while T-Mobile hasn’t yet announced availability and AT&T is launching the Galaxy S II on Oct. 2.

I nabbed an early review unit of AT&T’s Galaxy S II yesterday afternoon and immediately gave the handset a once over with a photo gallery. My general first impression: If you like Google Android and have or want an AT&T account, this smartphone should be at the top of your list.

The 4.3-inch display is so vibrant that I tweeted this last night: “Super AMOLED Plus gives new life to old “Cheers” episodes on Netflix.” Samsung’s dual-core processor makes this phone one of the fastest Android devices I’ve ever used. And even in my rural area where mobile broadband coverage is sketchy, I saw HSPA+ download speeds nearing 5 Mbps. I’ll have a full review forthcoming, but so far, I’m very impressed.

Also forthcoming is Amazon’s tablet entry, which will be based on Google Android. Amazon is expected to launch the device in the fourth quarter and it’s likely that next week will see the tablet introduced, due to a planned press event for an unknown product. Amazon has reportedly ordered monthly production of 800,000 such tablets; if true, the company should have plenty on hand after launch, even if the Kindle tablet proves extremely popular.

Based on an early hands-on look at a prototype, it’s pretty much a given that those familiar with Android won’t see a trace of it on Amazon’s tablet. The slate will use a heavily customized user interface that may limit what the device can, and can’t, do as compared to other tablets on the market. Surely it will support Amazon media offerings such as Kindle books, Amazon’s MP3 store, and likely Amazon’s Unbox video service. One open question I have is if Amazon’s AppStore will be supported for third-party Android software; my suspicion is yes, either at launch or through a future software update.

One app that received an update this week was Hulu Plus. The video subscription client was previously supported on just a handful of Android smartphones, but the list of compatible devices was updated this week. The HTC Flyer tablet in addition to the LG’s GX2 and Revolution, plus Motorola’s Bionic, Droid X2 and Droid 3 have all been added to the support list. The software is free but requires a monthly service fee of $7.99 to watch television programming on your Android smartphone or tablet.

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First look at AT&T’s Samsung Galaxy S II

AT&T is launching the Samsung Galaxy S II on Oct. 2 for $199 with contract, but a review unit showed up on my doorstep earlier today. I’ve just unboxed the device, which came with an optional USB to HDMI adapter, and have some first impressions as well as photos to share. If not for the back cover logo of Galaxy S II, the phone appears very much like the Samsung Infuse 4G I reviewed back in May. The dual-core processor, however, shows the difference once you power-on Samsung’s latest smartphone.

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ATT-GS2-1

Some quick thoughts, in no particular order:

Yes, the 4.3-inch display makes for a large phone, but the device is offset by a light weight and thin profile. It’s not quite as thin as my fourth-generation iPod touch, but pretty close as shown in the image gallery.
I like the power button on the right side of the GS2 as opposed to a power button on the top.
The phone is a speed demon; I haven’t yet used an Android phone this fast. You tap the screen, and the phone reacts.
The Super AMOLED Plus display is brilliant and vivid. It doesn’t feel like this phone has an 800×480 display; it appears like a higher-resolution screen.
NFC, or near field communications, is supported, although there is no application I can find to use this short-range wireless technology. The battery has “near field communication” on the front and back, so I’m assuming the NFC component is integrated into the battery.
I have decent AT&T coverage in my area (four out of five bars) and a quick speed test yields reasonable results: 81 millisecond ping time, upload of 1.62 Mbps and download speeds of 4.83 Mbps.
A few low-light camera shots came out quite nice, and zooming in shows nice detail.
I don’t like the microSD card slot placement; you’ll have to remove the phone battery to insert or remove a memory card.

My gut reaction: I can see many people happy with this phone on AT&T’s network, but I’ll use it for a few days to see if there are any quirks or gotchas to look out for. I also have no idea how long the battery will last on a charge. Of course, the elephant in the room for this phone is the upcoming new iPhone from Apple; next month could prove a superb smartphone showdown between the Galaxy S II and the next iPhone.

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Stat shot: Phones, tablets use airport Wi-Fi more than laptops

Smartphones and tablets now trump laptops for browsing at airport gates as the newer, more mobile devices use airport Wi-Fi more than traditional computers.

Wireless network provider Boingo Wireless notes that 58.9 percent of the total audience on its network in airports is made up of handsets and tablets, with the iPad alone accounting for 23.5 percent of these. While the recent growth of smartphone sales has surely contributed to this trend, Apple’s iPad may be just as big a factor; much of the mobile device growth Boingo has seen is from June 2010, or two months after the introduction of the original iPad.

In terms of smartphones, Apple’s iPhone is the most used device for Wi-Fi on Boingo’s airport network, with 42.1 percent of usage, or nearly four times as much as Android smartphones. Some other key takeaways:

Average megabytes per month used by mobile devices is now 211 MB, or nearly double the 114 MB used on average in May of 2009.
The corresponding megabytes used per minute is up as well: 0.89 MB vs 0.37 MB two years ago.
Network usage on mobile devices equaled that of laptops in airports just this past February, indicating the trend is continuing to accelerate.
While laptops outnumber mobile devices in terms of potential user audience by a factor of five, mobile devices now account for nearly 60 percent of Wi-Fi network usage.

I can remember wading through a sea of laptops while waiting for flights a few years back, but Boingo’s data roughly corresponds to what I see now: about half of those surfing the web at the gate are doing so on iPads and smartphones, with just an occasional sighting of an Android tablet.

I’m flying out this Sunday heading to our Mobilize event, and I’ll be sure to take a closer look at who’s using what while prepping for my flight. For the record, I’ll be packing my iPad for use in San Francisco, but I’m more likely to use my 7-inch Galaxy Tab at the gate and on the plane.

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