Future Insight: Mobile Commerce in Japan

Future Insight:Mobile Commerce in Japan

Christopher Billich

Mobile Copenhagen 2009June 16, 2009

What I will talk about in the next 30 minutes

Why the Mobile Webis huge in Japan

Mobile Shopping via Browser

Mobile Shopping via NFC

Some interesting Statistics

What I won’t talk about

daddytypes.com

I work for a company called

based

somewhere around herenasa.gov

which works for companies like

The Shameless Advertising

Part

The Shameless Advertising

Part

Who all want to know One Thing:

The Shameless Advertising

Part

“How can we applywhat already works in Japanin our mobile market?”

The Shameless Advertising

Part

“Wheel” [(h)w ēl]

circular object rotating on an axle

need not reinvent

Why look for answers in Japan?

“It’s when a technology becomes normal, thenubiquitous, and finally so pervasive it’s invisible, that the really profound changes happen [...].”

108 million mobile subscribers

9 in 10 use theMobile Web

>3 hrs 2-3 hrs 1-2 hrs 30 min-1 hr Daily, <30 min Less than daily I don’t

3%4%

13%

16%

22%

15%

24%

“More than an hour daily”: 61%

“At least daily”: 90%

...and they use it lotsMobile Web Usage Frequency, 16-24 year-old users

Source: Infinita, April 2008

Why that is

istockphoto.com

Operators: benevolent dictators

High-Spec Handsets

No device fragmentation

Unwalled Gardens

Revenue sharefavoring contentproviders

istockphoto.com

Carrier X Android iPhone Nokia 日本70%30-50% 90%70% 70%

Content Provider Revenue Share

Messaging is (almost) free ¥0,--

istockphoto.com

10,000 charactersMobile PCMultiple LinksEmoticonsAttachments

...yet extremely rich:

4 in 5 of them on 3GAlmost everyone on 3G

40% of mobile data users on data flat rate plans

istockphoto.com

The Low Entry Barrier Gym MembershipPricing Model

Email, not SMS

Operators control handset makers

(Open) standards

Operator revenue

share favors CPs

Same cost for on- and off-deck access

All handsets SIM-locked

Flat rate data with “free” messaging

Competition on network technologies

>90% 3G penetration

Operators pay handset

makers

Regulatory/Government Level

Operator Business Model Level

Operator-Handset Maker Relationship Level

User Experience Level

No spectrum license costs

The Secret SauceKey differences to other markets

Market VolumeMobile Commerce and Auctions (US$ billion)

Source: Mobile Content Forum (2005-2007), Infinita (2008 est.; 2011 est.)

2005 2006 2007 2008

1.85

1.55

1.30

1.12

1.34

1.23

1.11

0.89

3.39

2.71

1.93

1.65 4.443.292.58

1.54

GoodsServicesTransactionsAuctions

2011

3.06

1.79

6.23

9.17

29%

1%4%

11%17%

34%

4%

Active UsageVery interestedInterestedUndecidedNot really interestedDefinitely not interestedDon’t know

Mobile Commerce User BehaviorUsage and Usage Intention

Source: impress R&D, 2008 (Mobile Internet Users, N=3,178)

Total 10s 20ies 30ies 40ies 50ies 60ies

9179746971

6271

921263130

3829

10s 20ies 30ies 40ies 50ies 60ies

9282

63646464

818

37363636

Male Users

Male Users

Female Users

YesNo

Mobile Commerce User BehaviorUsage by Demographic

Source: impress R&D, 2008 (Mobile Internet Users, N=3,178), in %

Mobile Commerce User BehaviorPreference Criteria

Source: IMJ Mobile, 2008 (Active Mobile Shopping Users, N=312), in%, multiple answers

Trustworthiness

Ease of purchase

Loading speed

Convenience

Ease of reaching products page

Ease of comparing products

Degree of information detail

Quality of product search

Design

Ease of registration 22.4

22.8

27.9

33.3

41.0

49.4

54.8

59.9

60.3

63.1

Mobile Commerce User BehaviorPayment Preferences

Source: impress R&D, 2006 (Active Mobile Shopping Users, N=795), in%, multiple answers

Cash on Delivery

Credit Card

Pay at Convenience Store

Bank Transfer

Postal Transfer

via Mobile Phone Bill 6.3

20.5

22.6

36.1

49.4

65.0

Mobile Commerce User BehaviorProduct Categories

Source: impress R&D, 2008 (Active Mobile Shopping Users, N=927) in%, multiple answers

Fashion

Books, Magazines

CD, DVD

Cosmetics

Foods

Travel, Accomodation

Furniture, Design Goods

Health Goods

PC-related

Games 11.4

12.4

13.4

13.7

14.8

20.6

22.4

30.3

35.7

39.5

Mobile Commerce User BehaviorSpend per Year (in US$)

Source: impress R&D, 2008 (Active Mobile Shopping Users, N=927)

12%

15%

20%24%

11%

9%5% 1%

up to 2930-4950-99100-299300-499500-9991,000-2,9993,000-4,9995,000+

Mobile Commerce User BehaviorUsage Frequency

Source: impress R&D, 2008 (Active Mobile Users, N=927)

10% 16%

37%17%

11%

8%2%

Not at allOnce a year2-4 times/yr.5-9 times/yr.10-19 times/yr.More than 20 timesDon’t know

Mobile Users Mobile Data Users Mobile Shoppers

411

10389

205

8177

Mobile Commerce User BehaviorAverage Spend per Year by Reference Group (in US$)

20072008

Sources: impress R&D, 2008/2007; Mobile Content Forum 2007; Infinita 2008 (est.); includes Auctions

Product RecognitionCamera! ER Search

Product RecognitionCamera! ER Search

Operator/Retailer Collaborationau Shopping

Shopping for LaborOtetsudai Networks

Luxury Goods meet Manga on MobileLouie Vuitton

Love Soap and Runway ShowsGirlswalker/Tokyo Girls Collection

Mobile TV with Built-in Shopping1seg

Mobile NFCEnabled: 73%Usage: 18%

Source: impress R&D, September 2008 Base: All Respondents, N= 3,178 (2008)

Payment (Prepaid & Credit)

Coupons/CRM

Flight Check-in

“Lifestyle Infrastructure”

:

a.k.a.

Glued to the screen 24/7.

The second-best screen to be glued to:

Check out www.infinita.tv(it’s completely free)

Thank [email protected]