Mobile business: Don't believe the hype

Poor mobile website design and lack of support for NFC undermine the marketing hype

Despite the hype around mobile business, UK firms are failing to generate significant sales, through poorly designed mobile websites and barely any support for mobile wallets, according to two separate in-depth studies.

In the first piece of research concluded that 99 out of the top 100 FTSE companies do not address the needs of mobile customers.

According to mobile business agency Incentivated the top companies are wasting millions of pounds on internet advertising by sending visitors to mobile websites that do not work as users expect them to.

Jonathan Bass, managing director of Incentivated, said, "It's a myth that 2013 will be a tipping point for mobile, British businesses are woefully unprepared. Lots of companies are dipping their toes into mobile but very few are getting properly wet.

"Too many businesses assume that mobile is an extension of their current online offering."

Each FTSE-100 company website was analysed and scored for mobile readiness based on three essential requirements. This included whether a mobile search was automatically detected and directed to a mobile site (or served a responsive design), and whether the page size was small enough to load quickly on a 2.5G or 3G network.

The sites were also checked to see whether they were optimised to work across multiple mobile platforms such as Android, Windows and Blackberry, rather than just the iPhone alone.

Additionally the sites were also measured on whether they contained useful content to customers over and above blogs and lists of links to un-optimised desktop content, or whether there was adequate company branding for the mobile site.

The tests revealed that 69 of FTSE 100 firms are not optimised for mobile at all, and that 22 have tried to optimise for mobile users but have failed to do so "adequately".

Only eight scored "moderately well", but even these, Incentivated said, were "inadequate". Only one - Marks & Spencer - "stood out", scoring four out of five across the requirements above.

Surprising poor results included ARM (the designer of chips that power most mobile phones) and WPP (the world's largest marketing services business).

"Technically good" FTSE 100 companies included BT and Sainsbury's, along with Marks & Spencer. BT and Sainsbury's didn't score higher though as most of the actual service and product content that consumer's need was not optimised for mobiles.

In a second mobile business research study, polling company ICM looked at mobile wallets in the UK, and suggested that they would not take off in 2013, despite smartphone penetration of 60 percent.

ICM's regionally weighted consumer research among 2,015 consumers found contactless payments, which many consider the entry point for mobile wallets, were still in their infancy. Whilst consumer awareness was high at 80 percent, only 8 percent of people actually make contactless transactions.

ICM said there was a lack of retailer support with few terminals and little or no in-store promotion. In addition, widely held consumer security concerns have not been addressed, for instance what happens if customers lose their phone?

More than half (51 percent) of the consumers surveyed would use mobile wallets if their worries about security were addressed.

Consumers are ready to accept a range of security measures to gain confidence in mobile wallets - including a bank/mobile provider guaranteeing any financial losses (56 percent), entering a PIN on every transaction (43 percent) or after a number of transactions (37 percent), and being able to shut the mobile down remotely (40 percent).

Other forms of protection like setting a daily cap on spending (34 percent), facial recognition (33 percent) and voice recognition (24 percent) on the mobile handset also had consumer support.

ICM also believes that retail brands aren't doing enough to connect with their customers using the mobile tools they are already comfortable with, particularly apps.

In the run up to Christmas ICM found only one high street retailer using apps specifically designed to help with Christmas shopping.

In addition, said ICM, there simply aren't enough NFC (near field communication) enabled smartphones in the field, meaning many people can't yet make contactless payments by mobile even if they wanted to.

A major barrier to take up in 2013 is that smartphone users tend to be tied into long contracts, and people won't break their contracts just to get an NFC enabled device, said ICM.

Jamie Belnikoff, associate director at ICM Research, said, "Mobile wallets are about more than just paying - they allow consumers to manage their vouchers and discounts, loyalty cards, event tickets and public transport passes all in one place.

"Whilst people appreciate these advantages, their genuine security concerns, the lack of terminals in shops and absence of in-store promotions are preventing broader consumer take-up."

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