Unstable Internet, poor profit margins, and a lack of consumer awareness has created a problematic environment for mobile shoppers
Mobile commerce has been thriving in many parts of the world, but in Brazil, its growth has been stymied. One of the most significant challenges that mobile payments faces in the country is unstable bandwidth. There is also a general lack of awareness among consumers about what mobile commerce is and retailers have expressed disinterest in mobile payments because of limited profit margins. These issues are making Brazil a relatively unattractive mobile commerce market.
Retailers see low profit margins as a major detractor of the mobile space
Retailers have expressed their concerns regarding the low profit margins they see in the mobile space. Deal of the day promotions, which are common throughout the retail industry, are expensive for retailers to participate in, and the benefits they see from their participation are not enough to justify the effort. Small retailers also see limited value in offering mobile coupons, though these coupons serve as a powerful marketing tool, especially for mobile consumers that are often on the lookout for savings.
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Unstable Internet network makes it difficult for consumers to make use of mobile shopping platforms
Unstable Internet connections are another problem. The increased penetration of smartphones throughout Latin America has placed the region’s broadband network under significant stress. More people than ever before are accessing the Internet from their mobile device, and the wireless network may not be able to handle such massive amounts of traffic effectively. Losing connection to the Internet while trying to make a mobile payment is often a cause of frustration for consumers, leading them to avoid shopping from a mobile device.
Mobile marketing is also a problem for many retailers throughout Brazil
Marketing is another issue that retailers are having trouble with. Many retailers want to make use of geolocation services in order to provide consumers in specific areas with targeted promotions, but they are worried about bothering these people. The risk of annoying consumers is often seen as too great, leading many retailers to limit their mobile marketing strategies.