Tesco brings mobile shopping into the mainstream

Tesco, the UK’s largest retailer, is aiming to take the nascent mobile commerce sector into the mainstream by launching its first transactional mobile app.

Tesco

It is scheduled to launch the app on Nokia’s Ovi Store next week. It lets Tesco.com members browse a full store and update their shopping lists.

The retailer, which generated £136m in profit from online sales last year, is looking to lead the fledgling mobile commerce sector, which is seeing investment from rivals Asda, Ocado and Waitrose, while Amazon has also launched an online grocery service.

Tesco is targeting a mainstream audience, mothers especially, by initially bypassing the Apple App Store and focusing on more common handsets.

Nick Lansley, Tesco.com’s head of R&D, said it will look to roll out the transactional features to other products, such as its iPhone app and mobile site. “But our core customers are busy mums who don’t have iPhones and we want to focus on them first,” he added.

The move is a vindication of the m-commerce sector. The number of people worldwide using their mobile phones to purchase goods is set to hit 108.6m this year, according to research firm Gartner.

new media age also understands that rival supermarket retailer Asda, which currently has no mobile services, plans to increase its mobile activity, including launching an iPhone app, later this year.

An Asda spokeswoman confirmed the retailer was interested in developing its mobile strategy.

“We’re always looking at ways to enhance communication channels with our customers, including the use of mobile websites and how we can best serve our customers through m-commerce,” she said.

The moves will bring both Tesco and Asda alongside less mainstream retailers that have already launched transactional mobile services.

High street retailer Marks & Spencer and online grocer Ocado launched a mobile site and Android app respectively earlier in the year.

Ocado additionally reported that its iPhone app has generated 4.4% of all orders since it launched in July last year (nma.co.uk 20 April 2010).

Waitrose also recently launched its first iPhone app and an optimised mobile site last week, which are aimed at directing users to its outlets.

The competition in the mobile commerce sector is set to increase with Amazon’s beta-launch of a grocery delivery service and its forecast of $1.5bn (£940m) in mobile transactions this year.

Tesco.com has also formed a development team to bolster its mobile services and extend its strategy beyond the smartphone market before the end of the year.

Angela Maurer, head of web and mobile development at Tesco.com, said, “We’re launching our first transactional mobile app on the Nokia Ovi Store. We cross-referenced our research with Nokia’s and found a lot of crossover between its core customers and ours.”

In contrast, Ocado opted to launch its transactional app on the Apple App Store and subsequently on Google’s Android Market, while M&S refused to concentrate its mobile strategy within any one app store by launching a transactional mobile website (nma 13 May 2010).

Sienne Veit, M&S social and mobile development manager, said, “We wanted the mobile web to be the foundation our m-commerce strategy. We believe that by not restricting our services to one platform we have broadened our appeal.

“After launching in May we’ve had 1.2m unique visitors to the site, 300,000 who purchased goods there, and even someone who bought a sofa for £3,000.”

Sainsbury’s, which currently has no apps nor a mobile-optimised site, declined to comment on its mobile strategy.

Paolo Pescatore, director of apps and services at research firm CCS Insight, said, “Mobile will be a big battleground for supermarkets when it comes to loyalty.”

This story first appeared on newmediaage.co.uk

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