Mobile devices have penetrated every facet of our lives, and mobile technology, which has been adopted extensively for online shopping, has profoundly changed consumer behavior.
Research conducted by Deloitte shows that mobile devices will influence 5.1% of total retail store sales in the US in 2012, which translates into roughly $159 billion (€129 billion). Roughly 58% of consumers who own a smartphone have made online purchases through their mobile devices. Retail sales driven by mobile technology are expected to account for 17% to 21% of total retail sales in the US by 2016, equivalent to $628 billion to $752 billion.
Further enhancements in applications will no doubt enable retail businesses to deliver more value to customers. The cloud and the internet will be the key platforms for developing mobile applications that help strengthen the capabilities of retailers in business development.
New technologies from social networks to mobile devices allow consumers to increase their access to information, share intelligence, and compare prices and product/service performance. Retailers are leveraging the real-time connectivity enjoyed by consumers to offer first-hand information and promotions, such as coupons, alerts and location-based offers. Furthermore, mobile apps are being used to provide multiple purchase channels to improve the customer experience at each stage of the decision-making process.
Innovative technologies, such as NFC, enable mobile phones to support payments, gaming, security and authentication. Mobile wallets in some NFC-enabled point-of-sale terminals can allow the transmission of information via a highly secured payment connection. The data mining functions of mobile wallets enable retailers to collect information and analyze the shopping behaviors of consumers throughout the purchasing chain, covering their purchasing decision process and preference for promotion offers. With more understanding of their customers, retailers can better engage "smart" technologies to put together their promotion and loyalty reward programs.
Companies also are facing increasing demand from employees to connect their personal devices to the corporate network. Some companies are adopting a "bring your own device" (BYOD) strategy, which enhances the mobility of their workers by allowing them to connect their personal devices to the enterprise networks and applications.
While these trends present huge opportunities for both businesses and end-users, we should never underestimate the significant risks that come with the new technology. Mobile security is increasingly challenging, so we suggest you:
- Be vigilant about spyware and privacy breaches
- Be aware of the data leakage associated with device theft
- Defend against malware
- Adopt additional mobile security measures
- Devise an information control strategy for your devices
- Strengthen internal controls
- Seek professional support
Peter Koo is a partner for Deloitte China's enterprise risk services