Can m-Commerce Kill the Retail Industry?

Interesting post here, about the possibility for shoppers to arbitrage pricing while in-store, by texting a numerical product code to Amazon (AMZN) and seeing if they can get a discount.

Funnily enough, I actually registered a bunch of URLs in 2001 such as mobilecomparisons.com, in the expectation that this type of technology would emerge. I got bored waiting in about 2005, and let them lapse.

I can see some big advantages in this particular case - notably that it's Amazon, with whom many people already have an account via the PC (I can't imagine wanting to set up a new account on the phone), and who are also the masters of the logistical side. It's also good that it bypasses the operator (who would otherwise want to add their own margin to the price, probably negating the benefit). And it's certainly good that it charges to your credit card rather than your mobile bill.

On the other hand, even without any knowledge of the retail industry, I can think of numerous ways that this can be circumvented from the retailer's point of view:

• Work out an explicit value for "instant gratification" and make sure the Amazon discount doesn't cover it.
• Negotiate with your suppliers for slightly customised versions of products that aren't available through other channels, and which therefore have a unique UPC code or barcode that Amazon doesn't have access to.
• Put a sticker over the UPC code with a proprietary product tag only recognisable by the checkout system.
• Offer different "Get it now!" and "Free delivery tomorrow" prices for goods.
• Offering complex product bundles described on shelves & assessed at checkout ("Price of camera + memory card = $200", or even just "Buy one get one free").

I also think that some of the notions about always-on ubiquitous mobile broadband are over-optimistic, even though the US is now a bit of a special case because of 700MHz' reach. Verizon's (VZ) C-Block is 2 x 11MHz - and I'll leave it to a more techy-minded reader to work out the likely "Mb/s per square mile" based on density of cell sites, sectors/cell, frequency use & a bunch of other technical innovations like beamforming. But I'm pretty sure it's going to struggle to get to (let's say) an aggregate 1GB/s per square mile, which will then have to service all simultaneous users. Femtocells could help, but probably not in a retail environment.

Sure, the mobile web user experience will get a lot better with improved devices/browsers, and 3G/4G/WiMAX/white-space/band-sharing technologies. I can see evolutions of this technology with barcode (or even just product) photos being interpreted.

However, I can't see m-commerce killing retail, even though it may shake it up a bit, in the same fashion that PC-based Amazon already has.

Comments

[Malkiel]

None of these are any simpler than the charming lady who announces over the loudspeaker that there's an in-store special in aisle 7 for the next 15 minutes...