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Paypal Index Report Highlights mCommerce Opportunity Gap
Paypal launched its mCommerce Index Report today, highlighting key trends in Australian e-Commerce, including mobile and social commerce.
The mCommerce report revealed there a significant gap between consumer mobile payments behaviour and the readiness of businesses to support mobile transactions.
The report surveys conducted also identified that social commerce will be the next frontier of online commerce for Australian businesses.
Mobile Payments Opportunity Gap
The biannual Paypal report found that 71 percent of respondents reported using their mobile devices to make payments, with 22 percent indicating they spend above $500 per month, using mobile payments.
Despite this, the report found that only 49 percent of Australian online businesses are optimised to receive mobile payments. This represents a significant opportunity for local businesses to coin in on mobile-savvy customers. Further to this, one third of businesses say they have no plans to optimise their payment systems to include mobile payments.
“Australia has one of the highest levels of mobile penetration globally, with 80% of the Australian population owning a smartphone, so I was surprised to discover the low level of business readiness to accept sales effectively via mobile devices,” said Libby Roy, PayPal Australia’s Managing Director, highlighting the clear opportunity gap for Australian businesses.
“The mobile payments landscape is fast-evolving and the Index reveals how habituated Australian consumers have become to mobile shopping.”
Roy said that although online businesses may think they don’t need to optimise for mobile payments now, they will have to if they want to stay competitive in the near future.
The Paypal data also highlights that millennial customers are most likely to shop on a mobile device compared with other demographics, with 85 percent of 18 to 34 year old smartphone users making purchases via mobile.
Younger Aussies also shop more frequently via their mobile devices, with 47 percent of those surveyed indicating they do so at least once a week.
The report indicated that Australians shop on their mobile devices because they love the convenience, it saves time, and it’s easy. Security was highlighted as a major concern, with 46 percent citing it as a barrier to mCommerce adoption.
Roy Morgan Research Analyst, David McLeod, commented on the potential business impact of consumers’ security concerns surrounding mCommerce, implying there’s a clear need for consumer education and support around the security and integrity of online payments.
Companies like and Optus released mobile-pay apps like Smartswitch late last year, to enable consumers to pay for goods via its free Cash By Optus app, which operates similar to a Visa prepaid card (making it safer), however proved to be a tad limiting as it’s only available to Optus customers. Apple Pay also launched, which received mixed reviews, however security was listed as one of its pros.
Social Commerce Frontier
Shopping via a social platform has emerged as the new frontier for eCommerce, according to the index report. 11 Percent of Australian consumers indicate they’ve used social media platforms to make a purchase in the last six months, with only seven percent of Australian businesses optimised for social commerce.
Roy highlighted that 34 percent of Australian businesses having no social media presence at all, with 89 percent of businesses stating they have no intention of accepting payments via social platforms within the next six months.
“There’s a huge gap between the early adopters and the majority in the business community.”
Social media is also shown to be a strong channel for driving purchases with 18 percent of respondents buying something after seeing it on social media. Despite this, 28 percent of businesses indicate they don’t believe their customers want to buy via social media platforms.
Again, security was shown to be a significant barrier for consumers who don’t use social media platforms to purchase, with 59 percent of respondents saying they don’t want their financial information linked to their social footprint.