Wednesday, December 13, 2017

COMMENT: How ecommerce disrupted the mobile retail sector

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Since the early 1990s ecommerce has irreversibly transformed the way consumers purchase goods.

The statistics bear this out. In 2016, 65 per cent of UK adults owned a smartphone and a tablet. As early as back 2012 this figure was 51 per cent. In only four years it‘s projected that figure will grow by 14 per cent.

This has created a slightly peculiar situation in which consumers increasingly search for the best mobile phone deals on their mobile phones. As with other niches such as car insurance, home insurance and holidays, consumers place greater emphasis than ever on finding the best deals.

These factors have limited the need to travel to retailers on the high street in almost every sector not least mobile phone retailing. The fact is, since mobile technology became become ubiquitous, consumers have ruthlessly exploited the ability compare mobile phone deals with more convenience than ever.

It‘s no surprise then that as far back as 2014 it was reported that the closure of bricks-and-mortar travel agents rose to 45 per cent in a single year as consumers increasingly opted to find their perfect holiday online rather than through a high street travel agent.

In 2014, retailer Phones 4U went into administration, after failing to keep contracts with EE and Vodafone. More recently Sainsbury’s announced it was about to axe its Phone Shop.


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While bricks-and-mortar phone stores are on the way down, independent phone retailer Mobile Phones Direct has experienced a year-on-year increase in user engagement of its site. In 2015, the business garnered 38 million page views, whereas 2016 saw 41.5 million, an increase of around nine per cent.

One speculative reason for the increase in pageviews is the recent phenomenon of larger screen sizes on phones. Data suggests that consumers opting for phones with larger screens are more likely to use ecommerce services.

Looking to the future, it seems probable that bricks-and-mortar phone retailers will continue to struggle in keeping up with the ecommerce.

It has been reported that sales through UK high street stores are estimated to fall by 0.55 per cent this year and if ecommerce continues to thrive as it is currently doing, this trend will surely affect more than just the mobile phone retail sector.

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