Future of mobile commerce in Pakistan

Abstract

There is much talk these days about the vast potential of mobile commerce. Advertisements trumpet the latest hand-held wireless devices and the magical tricks they are said to perform. But despite the great promise of M-commerce, there are great doubts. How long will it take for its rich potential to become reality? To what extent are consumers being alienated by industry hype? What is the perception consumers have about this new technology? The current reality, to be sure, has plenty of hard edges. Mobile commerce, after all, is at an early stage of development and adoption. The research of early and potential users in showed widespread consumer frustration: There is a big gap between what the technology can now do and what the consumer has been led to expect. Nearly one-third of the early users surveyed abandoned m-commerce after only a few tries. The dropout rate was 42 percent: • Mobile users think the initial costs and operating fees are too high. Most want low flat fees, which are a staple of the fixed-line Internet. • Consumers' priorities are to communicate more effectively and save time. They are not satisfied with mobile applications in these key areas: speed, ease of typing in text, (and ease of navigation. • There is broad concern about privacy and security. 87 percent of the respondents believe that the mobile network is secure for transmitting credit card information than the fixed-line Internet as no credit card details are required. There is a related concern about advertising. Nearly 20 percent of those surveyed said they want to control the type and timing of ads that are sent to their mobile devices, and iii. they want the power to switch the ads off at will. The good news is how reminiscent this all is of the plight of the fixed-line Internet about ten years ago. At that time, the Internet was in its own early stage of adoption in Pakistan. It, too, had serious problems related to market acceptance, stemming from narrow bandwidth, slow transmission speeds, difficult user interfaces, and high costs. And it, too, was the object of dire predictions that it would never make it commercially. Thanks to technological advances and aggressive promotion by diverse players, the Internet did make it, of course. In fact, many m-commerce users consider the fixed-line Internet a benchmark: most of the survey respondents who have fixed-line Internet experience say that m-commerce can be a success only when it matches the simplicity, speed, and low cost of the fixed-line world. On the basis of this study and interview with the current users in this area, I believe that the m-commerce industry also has the potential to overcome its early problems, perhaps even faster than the fixed-line Internet did. The projections are based in part on my view of the inherent differences that distinguish m-commerce from e-commerce. One critical advantage is that users can have their mobile devices with them virtually anytime and anywhere. This difference means that there are opportunities to provide services that are not applicable to the fixed-line Internet. These include services that are tied to each user's location or are very personal in other ways (for example, allowing for the authentication of payments); services that bridge the gap between bricks and clicks (permitting users to examine merchandise in a store and still shop electronically for the best price); and services that enhance users' communication capabilities and extend the potential for community building. M -commerce players can get to the promised 1 and by 1 earning some 1 essons from the way Internet pioneers dealt with pricing, security, and other concerns common iv. to m-commerce players. But there are other issues that set M-commerce apart in a practical way and guarantee that special solutions will be needed. Chief among those concerns are the unique obstacles presented by the mobile device's user interface. The small size of both the screen and the keypad challenges consumers and industry participants alike. The size issue and the very personal nature of mobile devices present special hurdles that affect the potential for advertising. To get from here to there, M commerce players in Pakistan must understand how all of these distinctive characteristics and developmental differences will affect the marketplace and the roles they should play in it. They should identify the following five imperatives that all players-current and future-must consider as they explore and define their particular opportunities: • Capitalize on the unique capabilities of mobile applications to serve the consumer. As noted, m-commerce applications can be used anytime, anywhere, and in very personal ways. The winning strategy calls for actively using emerging localization and authentication features and fully leveraging the variety of roles future handsets will play: from personal assistants and "mobile wallets" to information centers and entertainment consoles. • Take steps to build the mass market. Simplicity is the key. As with the Internet in its early years, today's most popular M-commerce applications- e-mail and news, weather, and sports reports- are the simplest to use. It is also important to reduce the entry cost, introduce more appealing user interfaces such as voice activation, make sure the user's first experience is a good one, avoid promising too much, and, of course, address privacy and safety concerns. v. • Manage the gateway to consumers. Find ways to leverage brands, billing relationships, location data, and other capabilities in order to serve customers efficiently and to guarantee a positive user experience. One way to achieve this is to establish easy-to- use mobile portals either alone or in partnership with others. • Find ways to link customers' on-air, online, and on-site experiences. Many consumers are looking for a seamless experience and expect to use their handheld devices, their PCs, and, before long, their interactive TVs in complementary ways. Convergence is the name of the game, and companies with existing bricks and clicks are well positioned to play.