M-Commerce (mobile Ecommerce): Opportunity and Challenges in Nepal

M-commerce (mobile ecommerce): Opportunity and Challenges in Nepal

The internet has changed the way we consume. Today, more than ever, buyers have the power to purchase goods and services virtually from any retailer in the world. That’s why ecommerce has been booming. When we look around, it seems like everyone has a smartphone glued to their hands at all times. So it's no surprise that more than half of the internet traffic comes from the mobile devices. But mobile users are doing much more than just using these devices to browse online. They are also using phones and tablets to buy and are assisting in creating scope for M-commerce.

Mobile commerce (m-commerce) is a segmented market of ecommerce and the basis for such segmentation is the mode of pay device. The monetary transaction is completed using the mobile device. Simply, e-commerce where buying and selling of goods and services are conducted through wireless handheld mobile devices is M-commerce. This includes mobile phones, smartphones, smart watches, tablets, and netbooks.  M-commerce allows users to access online shopping platforms without needing to use a desktop computer. Examples of m-commerce include mobile banking, in-app purchasing, virtual marketplace apps like the Amazon mobile app or digital wallets such as Google pay, Apple pay, Android pay and Samsung pay, esewa, IMEpay  and many more.

The working mechanism of M-commerce along with its component are listed below:

• Identification keys: are numeric codes used to identify objects.
• Data carriers: are physical representation that carries the numeric codes.
• Modile devices: capture data from the data carrier
• Network providers and technologies: makes it possible to exchange data across a network.
• Information providers: provide information processing and transactional functionality.

Numeric identification codes are used to uniquely identify traded items, locations or services. Bar codes or RFID tags are used to represent these identifiers so that the mobile devices can capture them. An owner of a mobile device scans the bar code or tag and captures the identification code. A particular request is then issued by the mobile device and sent through a network to an information provider. Information processing takes place and the desired response is sent back to the mobile device

The raising popularity of M-commerce all over the world is because of the development and advancement of Information and Communication Technologies (ICTs). The advancements in integrated electronics enable the availability of technologies like broadband internet, in handsets and many other supporting service, networks and devices. Customer are also being more supporting for m-commerce due to the increased adoption of advanced technologies. All these innovation have made it possible to happen the mobile banking, mobile payment and mobile shopping.

These days it’s more likely that we forget our keys than our mobile phone when we leave home in the morning. As technology advances, mobile phones are able to be used to extend the reach of the person and delegate many functions that would previously have been more time consuming or would have to be carried out in person. As individuals, we expect to be able to do things whenever we want to and mobile phones are core devices enabling this expectation to be fulfilled. This means that there is a fundamental shift in our perception of space and time - of what is possible where and when. On the other hand, mobile phones are connecting people more than ever before and becoming new glue holding together social interactions and relationships. A mobile phone makes us available to others, 24 hours a day, 7 days a week. This is an enormous break with the past, when we needed to know where a person was in order to contact them. It gives enormous opportunities for businesses to really connect with and understand consumers and for consumers to have more meaningful relationships with businesses.

The drivers of mobile commerce are discussed below:

1. Widespread availability of mobile devices: It is estimated that within a few years, about 70 per cent of cell phones will have Internet access. Thus, a potential mass market is available for conducting discovery. This growth enables developing countries to leapfrog to M-commerce.
2. Widespread availability of mobile devices: It is estimated that within a few years, about 70 per cent of cell phones will have Internet access. Thus, a potential mass market is available for conducting discovery. This growth enables developing countries to leapfrog to M-commerce
3. The handset culture: Another driver of M-Commerce is the widespread use of cell phones, which is becoming a social phenomenon, especially among the 15–25-year age group. These users will constitute a major force of online buyers once they begin to make and spend a large amount of money.
4. Vendors push: Vendors are also pushing M-commence. Both mobile communication network operators and manufactures of mobile devices are advertising the many potential applications of mobile computing and M-Commerce so that they can sell new technologies, products and services to buyers.
5. Declining prices and increased functionalities: With the passage of time, the price of wireless devices is declining, and the per-minute pricing of mobile services is expected to decline.
6. Improvement of bandwidth: To properly conduct M-commerce, it is necessary to have sufficient bandwidth for transmitting text; however, bandwidth is also required for voice, video and multimedia. The 3G technology provides the necessary bandwidth at a data rate up to 2 Mbps.

 The success factors that make the M-commerce happen globally includes following:

1. Consumers are changing their behavior and expectations with regard to shopping and brand loyalty:  Mobile phones and the web are now allowing people to be more connected than ever - messages from other consumers are often more valued and trusted than messages from companies. Consumers respond positively to businesses that take the time to understand their needs and offer excellent customer service. Mobile technology allows businesses to become more service oriented in what they do and to tailor what they provide to better meet the needs of individual consumers.
2. Businesses are changing the way they do business: Businesses are looking for innovative ways to enter into a relationship with consumers. Technology is allowing a two-way dialogue between brand owners and consumers to be real.  Businesses are also recognizing the value of collaborating more closely with business partners and competitors. Sharing information about consumer behavior and supply chain processes is of critical importance.  Businesses are taking advantage of advances in technology to work faster, leaner and more intelligently. Small businesses are no longer at a disadvantage since complex business applications are available via the internet at low cost.
3. Mobile phones are enabling these changes to happen on a global scale: There are over 3 billion mobile phones worldwide. This means that over 40% of the world’s population carries a mobile phone, far more than use a computer or have access to the internet. In many developed countries, mobile phone penetration is above 90% and developing countries are catching up fast.  Closer, more personalized relationships between businesses and consumers are possible via mobile phones.  Emerging applications and services that add value to physical products and brands and go beyond limits previously imposed (such as extended packaging) already exist today on mobile phones.  Existing business issues (such as inefficient couponing) can be resolved effectively using mobile technology.  Convergence of different technologies on single devices that are available anywhere and anytime is allowing existing technologies (such as the internet) to evolve and extend their reach even further.

The purpose for the engagement of customer in M-commerce is more than just settling the transactions. The purpose include:

• Inspiration: the most common way people use mobile is to look for deals. It can in fact be a good idea for the business to adopt the model to become "mobile first" to offer special deals to users.
• Purchase: being able to purchase is the obvious motivation behind the mobile commerce experience. And this experience serves the customer who have no more time to wait.
• Research: consumer use mobile for product research, to compare prices and quality and keep up with the trends.
• Sharing: consumer share their experience about the service provide with their friends.

The ultimate goal of the mobile commerce is to generate more revenue reducing the cost and wastage. For this, the business should need to set strategies that favors the growth.  The strategies for the mobile commerce success could be the following: