June 29, 2007, was a momentous day in the tech world — on this day, Apple Inc. released the iPhone, the world’s first-ever “smartphone.”
In the history of civilization, there is only one mark that matters — the line delineating life before and after the launch of the iPhone. An entire generation of children will never know life without the power and conveniences of iPhones. They, like my daughter, will forever see a flip phone as “broken.” After all, is a phone without apps really a phone?
Steve Jobs described this new phone as a combination of three devices: a widescreen iPod with touch controls, a revolutionary mobile phone and a breakthrough Internet communicator. While this groundbreaking device maxed out at 16GB of storage and had a short battery life, consumers were poised to take this technology leap of faith. Just 74 days after the release of Apple’s first smartphone, the company sold its one millionth iPhone.
Ten years, 10 generations and 15 models later, the iPhone remains one of the most influential advancements of modern technology. In a mere decade, smartphone ownership has risen from zero to approximately 2.3 billion worldwide, with more than 223 million Americans, or nearly three-fourths of our country, owning one. We have come to view iPhones as extensions of our bodies; they are always in hand and are the first thing we grab when we need virtually anything — a ride to the airport, a stock price, social interaction, a new dress or even a hotel room.
And while smartphones afford us unprecedented access to information and unparalleled conveniences, there is no denying that smartphones equal business. Trillions of dollars of economic activity has been generated since the advent of the smartphone. Since the release of the first iPhone, users have downloaded more than 180 million apps from Apple’s App Store, grossing $70 billion for developers.
IPhone’s Impact on Global GDP
The post iPhone launch years have created a “button economy.” Multibillion dollar industries exist today — solely because of smartphones. Can you imagine getting to the airport without Uber? Or celebrating your birthday without posting a photo on Instagram? It’s hard to imagine, but before June 29, 2007, this was our reality.
It’s no coincidence that Uber was founded in March 2009, less than two years after the release of the first smartphone. Smartphones made on-demand transportation and ride-sharing possible. Similarly, smartphones have made numerous other app-based businesses possible, such as booking accommodation (Hotel Tonight and Airbnb), sending electronic payments (Venmo), finding a date (Hinge), buying music (Spotify) and navigating (Waze).
As smartphones become smarter and more robust, new smartphone-based businesses will continue to emerge, the economic impact is staggering.
IPhone: Where Retail and Mobile Commerce Come Together
There is no other industry as profoundly and positively impacted by smartphones as retail. In fact, Apple spawned an entire category for shopping apps and now every consumer has multiple retail apps on their phones.
Smartphones are responsible for creating the m-commerce industry; effectively taking sales from zero to hundreds of billions of dollars in just a decade. The smartphone has given the retailer the power to sell more personally and more efficiently and has given the consumer the power to buy more intelligently and more confidently.
Traditionally, brands didn’t have a direct link to the consumer and had limited data points on their preferences and behaviors. Smartphones allow retailers to reach a much broader audience — with a more personalized message at a fraction of the cost of traditional bricks-and-mortar establishments.
Communicating with and selling to customers directly through mobile apps allows retailers to expand their reach by three to four orders of magnitude. Store associates also benefit from mobile technology and leverage smartphone-based apps to provide enhanced clienteling services — including detailed knowledge about customers and their shopping habits, personalized communications and seamless checkout. This has resulted in higher conversions and enhanced customer loyalty.
Three Ways Smartphones Have Changed the Retail Game
1. Consumer Shopping Behavior
More and more consumers are demanding seamless checkout options using digital wallets. Apple and Warby Parker are great examples of retailers maximizing conversions by using smartphones to eliminate the need for consumers to wait in line to purchase. And the use of digital wallets like Apple Pay is increasing, with a 450 percent year-over-year increase in adoption.
2. In-Store Digital Experience
Consumers are reaching for their phones in-store with 62 percent of shoppers using a retailer’s mobile app whilst perusing the shopping aisles. In-store shoppers use their phones to scan tags for price and product information, receive location-based promotions, access loyalty programs and complete transactions.
3. Social Commerce
Consumers love browsing Instagram for inspiration with 68 percent of users engaging with brands regularly. Have you ever been scrolling through Instagram and “shopped a look” by simply tapping on the image to see what your fashion influencer is wearing? Cole Haan was the first fashion brand to launch a native app with a shoppable Instagram feed. Now, many other retailers, like Charlotte Russe and PacSun, have made their social networking apps shoppable from a smartphone.
Augmented Reality Will Take iPhone to the Next Level
And we are not done yet; we are just getting started with innovations in mobile commerce. In the coming months and years, we will see dramatic advancements in the areas of artificial intelligence, augmented reality and conversational commerce as well as enhancements to battery life and network bandwidth.
Apple chief executive officer Tim Cook has touted the importance and ubiquitous nature of AR stating “I regard augmented reality as a big idea like the smartphone. The smartphone is for everyone, we don’t have to think the iPhone is about a certain demographic, or country or vertical market: it’s for everyone.”
Nitin Mangtani is founder and chief executive officer of PredictSpring, a mobile commerce platform.