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24 June, 2014
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m-Commerce: Mobile transactions in Australia

By Editor

lady using mobile phone to pay

This snapshot presents the latest ACMA analysis on the take-up of m-commerce in Australia by people aged 18 years or over. Unless otherwise stated, data used in this snapshot is sourced from Roy Morgan Research.[1]

Mobile commerce—‘m-commerce’—is a term used to describe undertaking banking or paying bills, or buying goods and services online using a mobile phone.

The use of m-commerce services in Australia is soaring—during December 2013, 3.4 million Aussies used an m-commerce service, up from 0.62 million during December 2010. That’s an increase of 448 per cent.

As well as m-commerce transactions, nearly four million Australians also used their mobiles for a diverse range of non-transactional m-commerce activities. This included activities that aren’t about moving money, such as checking account balances, and researching products and services to buy.

This huge growth in the use of m-commerce is enabled by a number of key developments, including increases in the:

  • take-up of smartphones—12.07 million people owned a smartphone[2] at May 2014, an increase of eight per cent since May 2013[3]
  • use of the internet over mobile phones—this has grown by 196 per cent in three years, with 8.3 million active users during December 2013 compared to 2.8 million during December 2010
  • availability and use of mobile phone banking and shopping applications—8.9 million Australians with an internet-enabled mobile phone[4] downloaded a mobile app in the six months to May 2013, with 4.3 million downloading a banking and finance app and 2.9 million downloading a shopping app[5]
  • availability of 3G and increasing rollout of 4G mobile phone networks—3G networks covered 94–99 per cent and 4G networks covered at least 66 per cent of the Australian population at June 2013, with further coverage underway.[6]

Young mobile users leading the way

Of Australians accessing the internet on their mobile phone during December 2013, 41 per cent undertook an m-commerce transaction, with use by those aged 25–34 reaching 55 per cent. This compared to 22 per cent using m-commerce services during December 2010.

While use of transactional m-commerce has grown across all age groups since December 2010, the most significant increase—31 percentage points—was recorded for people aged 25–34 (Figure 1). 

Figure 1 Use of transactional m-commerce by age during December 2010 and December 2013

Figure1 gif

Percentage of Australians aged 18 years+ who accessed the internet on their mobile phone.
Use of transactional m-commerce by age during December 2010 and December 2013  (xlsx)

People aged 25–34 were 33 per cent more likely to use m-commerce services during December 2013 compared to m-commerce users in general—a reflection of their higher propensity to undertake activities online. People aged 65 and over were 58 per cent less likely to use m-commerce (Figure 2). 

Figure 2 Propensity of age groups to use m-commerce transaction services during December 2013

Figure2 gif

Australians aged 18 years+ who used m-commerce services.

Propensity of age groups to use m-commerce transaction services during December 2013 (xlsx)

Banking on m-commerce

Both mobile banking and online shopping more than doubled between December 2010 and December 2013. During December 2013, 35 per cent of mobile phone internet users banked or paid bills online via mobile phones, while 22 per cent shopped online. Over the three years, this was an increase of 18 percentage points for banking and 13 percentage points for shopping (Figure 3).

Figure 3 Change in m-commerce transactional activities undertaken, December 2010 to December 2013

Figure3 gif

Percentage of Australians aged 18 years+ who used the internet on their mobile phone.

Note: Mobile online banking includes mobile banking and bill payments.

Change in m-commerce transactional activities undertaken, December 2010 to December 2013 (xlsx)

Transferring funds online was by far the most common transactional m-commerce activity. This was undertaken by 77 per cent of m-commerce users during December 2013, compared to 69 per cent during December 2010 (Table 1).

Table 1 m-Commerce transactional activities undertaken

 

During December 2010

During December 2013

Mobile banking and bill payment transactions

 

 

Transferring funds online

69%

77%

Paid bills online

34%

46%

Mobile shopping transactions

 

 

Persons who have purchased, sold or participated in an auction online

39%

33%

Used an online payment/money transfer system

16%

33%

Paid for purchases using a credit card

23%

21%

Percentage of Australians aged 18 years and over who have made an m-commerce transaction. 

A hive of activity

As well as performing m-commerce transactions, Australians are undertaking a diverse range of non-transactional m-commerce activities online via their mobile phones, such as checking account balances. During December 2013, nearly four million people aged 18 years and over (48 per cent of mobile phone internet users) undertook non-transactional m-commerce-related activities, compared to 0.6 million (23 per cent of mobile internet users) during December 2010. 

Non-transactional banking activities

During December 2013, 3.4 million people aged 18 years and over (41 per cent of the total number of mobile phone internet users) undertook a non-transactional banking activity, compared to 0.6 million (21 per cent of mobile internet users) during December 2010.

Figure 4 presents an overview of the range of non-transactional banking activities performed online via mobile phones in Australia during December 2013. This shows ‘checking bank account balance’ was the most common activity performed, done by 91 per cent of people undertaking non-transactional mobile banking activities.

Figure 4 Non-transactional online mobile banking activities undertaken during December 2013

Figure4 gif

Percentage of Australians aged 18 years+ who have undertaken non-transactional mobile banking activities.

Non-transactional online mobile banking activities undertaken during December 2013 (xlsx)

Researching products or services online

The diverse range of non-transactional shopping activities performed online via mobile phones in Australia is shown in Figure 5, below. During December 2013, 1.8 million people aged 18 years and over (22 per cent of the total number of mobile phone internet users) undertook a non-transactional shopping activity online, compared to 0.3 million (nine per cent of mobile internet users) during December 2010.

Researching a product or service to buy was the most popular activity, done by 79 per cent of mobile phone internet users undertaking mobile shopping research. There has been little change in use of non-transactional shopping activities over the past three years, with the number of users researching a product or service ranging between 77 and 79 per cent.

Figure 5 Online mobile shopping research activities undertaken during December 2013

Figure5 gif

Percentage of Australians aged 18 years+ who have undertaken mobile shopping research.

Online mobile shopping research activities undertaken during December 2013 (xlsx)

Age drives non-transactional activities

Age had a major influence on the take-up of non-transactional m-commerce activities, with mobile phone internet users aged 18–24 (45 per cent) and 25–34 (52 per cent) more likely than other age groups to do non-transactional banking activities. Those aged 25–34 were also more likely to undertake non-transactional shopping activities—33 per cent, compared to only five per cent for those aged 65 and over.  

Intensity of m-commerce activities on the rise

Intensity of use refers to the number of different activities undertaken by a mobile internet user. Banking activities were by far the most popular and most intensive m-commerce activity undertaken by consumers during December 2013:

  • Of those who performed m-commerce activities on their mobile phone, 57 per cent undertook a shopping activity online, while 85 per cent undertook a banking activity online.
  • 33 per cent of those who banked online via their mobile phone undertook three or more banking activities online. This compared to 20 per cent of those who shopped online via their mobile phone who undertook three or more online shopping activities.

For both banking and shopping activities, there has been an increase in intensity of use (Figure 6).

Figure 6 Number of m-commerce activities undertaken during December 2010 and December 2013

Figure6 gif

Percentage of Australians aged 18 years+ who used m-commerce services

Note: Includes transactional and non-transactional activities.

Number of m-commerce activities undertaken during December 2010 and December 2013 (xlsx)

PC transactions still lead the way

Levels of e-commerce—a term used to describe undertaking banking or bill payment transactions or buying goods and services online using a PC—have remained stable over the past three years while the level of m-commerce has increased substantially. However, m-commerce has yet to reach the levels of traditional PC-based e-commerce.

Figure 7 shows that during December 2013, the proportion of Australians:

  • banking online via a PC was 27 percentage points higher than the proportion of people using their mobile phones for online banking
  • shopping online via a PC was 24 percentage points higher than the proportion of people using mobiles phones for online shopping.

A similar trend was identified for non-transactional activities.

 Levels of non-transactional activities undertaken on a PC were similar to the level of transactional activities undertaken on a PC. In comparison, more Australians undertook non-transactional than transactional activities via their mobile phones, particularly for mobile phone banking.

Going online in many ways

Internet users in Australia go online via multiple devices, reflecting the complementary nature of internet access. In the six months to May 2013, 62 per cent of internet users went online via three or more devices—typically a desktop computer, mobile phone and portable computer.[7] Large numbers of Australians are also using the internet via tablets—47 per cent of internet users in the six months to May 2013[8]—with the likelihood of increased e-commerce activities occurring over these devices. The growth in tablet use will be explored in a researchacma snapshot scheduled for release in late 2014.

Figure 7 Banking and shopping activities performed online via a mobile phone or PC during December 2013

Figure7 gif

Banking and shopping activities performed online via a mobile phone or PC during December 2013 (xlsx) 

M-commerce payments

There are numerous ways that consumers pay for mobile content online. These include:

  • credit/debit card
  • online money transfer systems such as PayPal or BPAY
  • mobile wallets such as GoogleCheckout
  • digital stores owned by the major mobile operating systems—for example, iTunes and Google Play
  • via their mobile phone bill.

Online money transfers are the most popular payment system used. Of those who made an m-commerce transaction during December 2013, 33 per cent used a money transfer system and 21 per cent used a credit card. The use of non-money transfer methods such as mobile wallets is still relatively small. People aged 25–34 were more likely to use online payment money transfers—37 per cent compared to 23 per cent of those aged 50 and over (Figure 8).[9]

Figure 8 Mobile payment methods used by age during December 2013

Figure8 gif

Percentage of Australians aged 18 years+ that used m-commerce services in each age group.

Figure 8 Mobile payment methods used by age during December 2013 (xlsx)

Improving the consumer m-commerce experience

Improved m-commerce platforms can enhance consumer experience. Developments have enabled consumers to access information on products and services quickly and easily online by making m-commerce transactions appear seamless. Key developments in this area include:

  • mobile-optimised webpages
  • mobile applications
  • Quick Response (QR) readers—this is code that a mobile phone can scan and contains information such as location, URLs, links to coupons and videos.

ACMA research shows that 18 per cent of SMEs connected to the internet had developed mobile-optimised websites at May 2013.[10]

In addition, 59 per cent of mobile phone internet users had downloaded an app (4.3 million people downloaded a banking and finance app, and 2.9 million a shopping app[11]) and one in 10 had used a QR reader at December 2013.

The use of these services has a direct correlation with use of m-commerce, with those who have downloaded an app or used a QR reader more likely to have undertaken an m-commerce activity. For example, of mobile internet users who have used a QR reader:

  • 46 per cent have made a mobile banking transaction
  • 34 per cent have made a shopping transaction.

This compares to all mobile phone internet users, with 35 per cent making a mobile transaction and 22 per cent a shopping transaction.

Figure 9 Platform influence on m-commerce activities undertaken during December 2013

Figure9 gif

Percentage of Australians 18 years+ who used the internet on their mobile phone.

Platform influence on m-commerce activities undertaken during December 2013 (xlsx)

Comparing local and international m-commerce growth

Direct comparisons between Australia and other countries are not possible due to lack of comparable data. However, some industry data from the UK and US shows that growth in m-commerce is a global phenomenon and a driver of the emerging global digital economy.

Table 2 International comparison of m-commerce

Australia

UK

US

Smartphone penetration

59 per cent

51 per cent[12]

56 per cent[13]

m-Commerce users

3.4 million Australians aged 18 and over made an m-commerce transaction in December 2013.

A fifth of mobile internet users had made purchases from their handsets at April 2013.[14]

N/A

Revenue and/or growth

Purchases via mobile devices grew by 30 per cent in 2013, accounting for $4.9 billion (27 per cent) of all online shopping purchases.[15]

m-Commerce estimated to have accounted for 15 per cent of total retail e-commerce sales in 2013.[16]

m-Commerce spending reached $4.7 billion in Q2 2013, with a year-on-year growth rate of 24 per cent.[17]

Background to this snapshot

Data sources

Data in this snapshot is taken from Roy Morgan Research (Roy Morgan Single Source product)—data covers changes occurring from December 2010 to December 2013.

Estimates in this snapshot are based on the following sample sizes:

Table 3 Sample size (persons 18 years and over)

December 2010

December 2013

Sample

Mobile internet user sample size

1,938

3,285

m-Commerce user sample size

387

1,253

ABS total population[18]

16,972,406 (June)

17,898,348 (June)

Source: Roy Morgan Single Source and Australian Bureau of Statistics.

researchacma

This snapshot is part of the ACMA’s research program, researchacma, which has five broad areas of interest:

  • market developments
  • media content and culture
  • digital society
  • citizen and consumer safeguards
  • regulatory best practice and development.

Each snapshot covers a single issue and allows the ACMA to focus on communications, convergence and digital economy issues of interest to stakeholders. Access other snapshots here.

Further information

The ACMA Communications report 2012–13 is available, along with two complementary reports:

  • Report 1—Australian SMEs in the digital economy
  • Report 2—Cloud computing in Australia.

These reports can be accessed from www.acma.gov.au/commsreport.

This snapshot and all the ACMA’s research publications are on the ACMA website at www.acma.gov.au/researchacma.

Comments and enquiries about research snapshots should be sent to communications.analysis@acma.gov.au.

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Endnotes


[1] Roy Morgan Single Source.

[2] A smartphone is a mobile phone built on a mobile operating system, with more advanced computing capability and connectivity.

[3] ACMA-commissioned survey May 2014 and Communications report 2012–13.

[4] An internet-enabled phone is any mobile phone that offers access to internet services.

[7] ibid.

[8] ibid.

[9] Historical comparisons are not possible for age groups due to small sample sizes in December 2010.

[10] ACMA, SMEs—key drivers of the digital economy, 22 January 2014.

[11] In the six months to May 2013. ACMA Commissioned research.

[12] Ofcom, The Communications market report, August 2013.

[13] David Moth, econsultancy, 50+ fascinating stats about mobile commerce in the US, 22 January 2014.

[14] ibid.

[15] CRM Innovation Editors, Frost & Sullivan sees continued high growth for mobile commerce in Australia, 27 November 2013.

[16] Emarketer, M-commerce takes 15% of UK retail ecommerce sales, 20 June 2013.

[17] ibid.

[18] Australian Bureau of Statistics, 3101.0 Australian Demographic Statistics, September 2013

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