Why you shouldn’t ignore the success of the smartphone

New research from PayPal has found that despite the boom in mobile sales – estimated to hit £27 billion in 2017 – just 18 per cent of the UK’s small businesses are optimised for mobile.

British small businesses could be failing to cash in on the boom in mobile shopping by not having websites that automatically adapt for the different screen sizes of smartphones and tablets, according to new research from PayPal. A UK-wide survey of more than 2,000 small businesses and 2,000 consumers reveals a growing gap between online shoppers’ mobile preferences and what small businesses are offering – which could be costing them potential sales.

PayPal research shows that mobile shopping growth is outstripping overall online spending by four to one in the UK. This trend looks set to continue, with 30 per cent of Brits expecting to use their smartphones to shop more often in the next 12 months, rising to 44 per cent for 16 to 25-year olds. Mobile devices are already central to today’s shopping experience with six in ten (59 per cent) ‘millennials’ browsing for new purchases on their smartphone every day.

Overall consumer appetite for mobile shopping is also growing quickly: the estimated annual spend on mobile nearly doubled from £13.5 billion to £27 billion from 2016 to 2017 and it is estimated to hit £43 billion by 2020. Despite this, only 18 per cent of UK small businesses have a website that is friendly for mobile devices, an increase of just one per cent on 2016. Businesses’ reluctance to adapt – 33 per cent say they don’t need a business site because they ‘do well enough as it is’ – risks alienating consumers, who list lack of mobile friendly website as their number one frustration when buying on a mobile device.

The divide between what shoppers prefer and what small businesses offer also extends to the most popular ways to pay and be paid. The research finds that while shoppers of all ages are embracing new mobile-friendly payment methods such as digital wallets (preferred by one in three online shoppers), 40 per cent of small businesses have never reviewed how they take payments – a small improvement from 2016, when 44 per cent of small businesses had never considered their payment options. Instead, businesses continue to rely on traditional methods including bank transfer (70 per cent), cash (54 per cent) and cheque (45 per cent) to take payments.

For small businesses, adopting more popular modern payment methods could mean a big boost in sales. For more than a third of businesses, the average value of an individual sale is between £10 and £30, but PayPal’s research shows that consumers are willing to pay up to three times that on digital devices: £84 on a smartphone, £103 on a tablet and £147 on a laptop.

Nicola Longfield, director of Small Business at PayPal UK, says, ‘With mobile web browsing overtaking desktop for the first-time last year, it is more important than ever that businesses adapt. Bridging the gap between customer expectation and what businesses are offering need not be daunting. There are small changes businesses can make to give themselves a boost, and the top item should be making websites more mobile friendly for smartphone or tablet. Shoppers are increasingly frustrated by websites which require them to pinch the screen to zoom in and scroll endlessly to find miniature checkout buttons.

‘Knowing your customer is all-important. The profile of a UK mobile shopper is very similar to an online shopper, so it really is a case of fine-tuning business practices to make the most of customers’ habits. This could be sharing promotions on customers’ favourite social channels, scheduling marketing emails to coincide with peak mobile shopping times, or simply offering recognisable payment options to give shoppers that extra confidence in their purchases.’

Further reading on using your smartphone for business

Owen Gough, SmallBusiness UK

Owen Gough

Owen was a reporter for Bonhill Group plc writing across the Smallbusiness.co.uk and Growthbusiness.co.uk titles before moving on to be a Digital Technology reporter for the Express.co.uk.

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