Modern tablets have only been on the market for less than two years, but they have quickly become potent shopping tools that generate an outsized effect on online commerce. Last year was the year that the tablet became an online retailer’s best friend as it emerged as the preferred device for many shoppers to make their purchases.
The latest data came earlier this week from Adobe Digital Marketing Insights (pdf), which found that tablet users spend over 50 percent more for each transaction at an online retailer compared to smartphone users and 20 percent more than traditional computer users. Adobe found that the average order value for tablet users was $123 on average per purchase, 54 percent more than smartphone users ($80) and 21 percent more than computer users ($102).
Adobe also found that tablet users were three times more likely to buy something than smartphone users and nearly as likely to convert to a purchase as traditional computer users. Tablet users now make up 4 percent of all total web visits to retailers, up from 1 percent a year ago. Adobe gathered the data from 16.2 billion visits to the websites of more than 150 retailers in 2011.
The data is consistent with other findings in the previous months that indicate just how tablets are able to create a bigger commerce effect despite its smaller reach. Last year Forrester reported that tablets accounted for 20 percent of e-commerce sales, even though only 9 percent of shoppers own tablets.
A study by Ipsos OTX MediaCT on behalf of PayPal found that tablet owners were almost twice as likely to make purchases as those who only have smartphones. And 28 percent of dual smartphone and tablet owners said they were sure they spent more due to mobile shopping, compared with 13 percent of smartphone owners who said the same.
Some retailers are seeing an even bigger effect from tablets. I recently wrote about Fab.com, whose CEO, Jason Goldberg, told me that mobile users are twice as likely to buy products than computer visitors and that the iPad has purchase amounts that are an order of magnitude higher than on iPhone, Android and the web.
Tablet commerce is fueled by the fact that the larger screen on the devices provides a lot of real estate to see products, and the touch interface lets consumers get even more intimate in their shopping than with a PC. Tablets are more portable than laptops, so they lend themselves to shopping from a couch or a bed, but they can generate sales on the go as well. The fact that tablets are still more of an early adopter device also means that users are more affluent and tech-savvy, so they may be more inclined to spend and buy online.
The push toward tablet shopping only intensified this holiday season as consumers cranked up their buying from mobile devices. IBM reported that sales from mobile devices doubled this past holiday season, hitting 11 percent of online purchases, compared with 5.5 percent in Dec. 2010. That helped push overall online sales up 7.5 percent over 2010. The iPad had the highest conversion rate for transactions, at 6.3 percent, compared with 3.1 percent for all mobile devices. In fact, on Christmas day, about 7 percent of all online purchases were made using iPads.
E-commerce software developer Ability Commerce said last week that mobile shopping revenues on Android grew by 173 percent compared to last holiday season, while iOS had a 338 percent increase in revenues. The iPad, while generating one-third the traffic of the iPhone and Android, had 33 percent more revenue than both iPhone and Android combined.
If it is not apparent to retailers already, the world is turning mobile. If it is actual sales they are after, they need to think about how they are serving tablet users. Smartphones are still very important and often serve as a research tool, helping gather data that can be used for a later purchase. But increasingly, consumers are showing that they love shopping on a tablet. This is something Steve Jobs understood really well more than decade ago when he told a Wired reporter in 1997 that the benefit of the web was going to be realized by people interested in selling things.
“It’s more than publishing. It’s commerce. People are going to stop going to a lot of stores. And they’re going to buy stuff over the Web!” he said.
That vision has crystallized with the iPad. And this is something Amazon has also clearly picked up on with the Kindle Fire, which is really just a front end for its online store. It is almost too easy to purchase something from a Kindle Fire, which combines the strengths of tablet shopping with Amazon’s one-touch buying experience. If they haven’t already, retailers need to understand how to capitalize on this opportunity. As Fab.com’s Goldberg told me, he has treated the tablet experience on Fab’s mobile apps much like its smartphone experience.
But there is more to be done to cater to tablet users and fully build upon that distinct opportunity, which is only going to grow as tablets proliferate. That means optimizing for tablets and the iPad specifically and making sure a website works well for tablet users using touch input. Wal-Mart, for example, put out iPad and iPhone apps in November that had different capabilities that catered to the unique use cases for each device, with the iPad app focused on shopping and browsing while the iPhone app featured shopping lists, QR code scanning, coupons and a store item locator.
Last year was a breakout year for tablet shopping, even with the limited penetration of tablets. But this year is going to be huge, with a new iPad out soon and the Kindle Fire and Nook Color making tablets even more affordable on the low end. The question of whether users prefer to buy on a tablet has been answered. Now it is just a question of how much business retailers can rake in by taking advantage of that fact.
Images courtesy of iStockphoto, Flickr user shareski